In one of his myth-busting videos, Krish Ashok talks about how thousands of Indians who are actually rich believe they are middle-class because the gap between the rich and the super-rich is so stark. Living in gated communities inside metros, working in fast-growing companies, being online all the time, valuing time and convenience over anything else, we have no idea that any other kind of life is even possible. Because we haven't shopped from a local kirana store in many years, we believe reports that say nobody shops from kirana stores. (We may still not do anything to change our habits or support these kirana stores in any way, except perhaps write a tweet thread about it.)
I love the whole idea behind this newsletter, to examine all kinds of data to evaluate whether a popular or even a controversial piece of news is really true. Looking forward to more!
P.S. Half Ticket is a remake of the critically acclaimed 2014 Tamizh film Kakkamuttai (Crow's Egg).
There was a Matt Yglesias post about big retailers being more productive and better employers than mom-and-pop stores, which led me to binge-read about Kirana stores in India. I too found those fear-mongering "Kirana stores aren't gonna make it" articles from the early 2010s. And I concluded that much of it was overblown, given that it was impossible for online delivery apps to penetrate every nook and corner of India and have the personal touch of your neighborhood mom-and-pop store.
Not just that, the government did launch the ONDC scheme so mom-and-pop stores could have a level playing field, but idk how it's working out.
Very well written article Jaidev. While I don't own a kirana store, I am an owner of a jewellery store. We also differentiate oursleves by being a neighbourhood centric store.
I think as sellers we all unfortunately compete for the urban/piped gas/PG customers. We talk discuss give and take advice for tha same 7%.
The offline neighbourhood stores can no more serve those customers on the promise of convenience they must either find a different need to satisfy or try to target a few % customers from the rest of the pie.
This was extremely informative and well researched. Coming from an FMCG background, the story around qcomm disruption has entered the daily parlance of every executive, so much so that the narratives have overshadowed facts.
The exorbitant growths of qcomm are undeniable. It is viewed as the channel of the future, but right now the growths of qcom are mainly inorganic owing to expansion. As an industry everyone is just trying to find some method to the madness, and figure how to win on qcommerce. At the same time, one cannot ignore general trade but largely this channel is degrowing. But i agree with your hypothesis, it probably isnt because of new channels but rather because of growing inequality and consumer demand reducing.
Interesting read. The growth of quick commerce could be mirroring the growth pattern of Indian metros.
Gated communities in non-walkable areas are "outsourcing" their walk to the neighborhood kirana to Q-Commerce. (Segment-A)
Large parts of metros are still in small sized apartments or builder floors and might have very little need to order online. Q-comms are capturing this segment by offering a variety that the kiranas can't offer (Segment-B)
The other smaller segment is large individual housing which is a (high paying) niche in Indian metros. (Segment-C)
In India, Q-Commerce will grow fastest in Segment-A. It's struggling in Europe because of the prevalence of Segment-B. It's also struggling (mostly) in the US because of Segment-C, who have the option of driving to the nearby Walmart.
In one of his myth-busting videos, Krish Ashok talks about how thousands of Indians who are actually rich believe they are middle-class because the gap between the rich and the super-rich is so stark. Living in gated communities inside metros, working in fast-growing companies, being online all the time, valuing time and convenience over anything else, we have no idea that any other kind of life is even possible. Because we haven't shopped from a local kirana store in many years, we believe reports that say nobody shops from kirana stores. (We may still not do anything to change our habits or support these kirana stores in any way, except perhaps write a tweet thread about it.)
I love the whole idea behind this newsletter, to examine all kinds of data to evaluate whether a popular or even a controversial piece of news is really true. Looking forward to more!
P.S. Half Ticket is a remake of the critically acclaimed 2014 Tamizh film Kakkamuttai (Crow's Egg).
Thanks a lot, Gowri. I think I should watch the movie in the original Tamil.
There was a Matt Yglesias post about big retailers being more productive and better employers than mom-and-pop stores, which led me to binge-read about Kirana stores in India. I too found those fear-mongering "Kirana stores aren't gonna make it" articles from the early 2010s. And I concluded that much of it was overblown, given that it was impossible for online delivery apps to penetrate every nook and corner of India and have the personal touch of your neighborhood mom-and-pop store.
Not just that, the government did launch the ONDC scheme so mom-and-pop stores could have a level playing field, but idk how it's working out.
Very well written article Jaidev. While I don't own a kirana store, I am an owner of a jewellery store. We also differentiate oursleves by being a neighbourhood centric store.
I think as sellers we all unfortunately compete for the urban/piped gas/PG customers. We talk discuss give and take advice for tha same 7%.
The offline neighbourhood stores can no more serve those customers on the promise of convenience they must either find a different need to satisfy or try to target a few % customers from the rest of the pie.
Thanks, Apurva! BTW the HCES also has data about jewellery shopping. Let me know if you're interested in looking at it :D
Hey Jaidev,
Sounds interesting, would love to see it. Thanks.
This was extremely informative and well researched. Coming from an FMCG background, the story around qcomm disruption has entered the daily parlance of every executive, so much so that the narratives have overshadowed facts.
Thanks for reading! I'm curious, what's the inside story about qcommerce? What do you think the FMCG industry’s view of qcom is?
The exorbitant growths of qcomm are undeniable. It is viewed as the channel of the future, but right now the growths of qcom are mainly inorganic owing to expansion. As an industry everyone is just trying to find some method to the madness, and figure how to win on qcommerce. At the same time, one cannot ignore general trade but largely this channel is degrowing. But i agree with your hypothesis, it probably isnt because of new channels but rather because of growing inequality and consumer demand reducing.
Interesting read. The growth of quick commerce could be mirroring the growth pattern of Indian metros.
Gated communities in non-walkable areas are "outsourcing" their walk to the neighborhood kirana to Q-Commerce. (Segment-A)
Large parts of metros are still in small sized apartments or builder floors and might have very little need to order online. Q-comms are capturing this segment by offering a variety that the kiranas can't offer (Segment-B)
The other smaller segment is large individual housing which is a (high paying) niche in Indian metros. (Segment-C)
In India, Q-Commerce will grow fastest in Segment-A. It's struggling in Europe because of the prevalence of Segment-B. It's also struggling (mostly) in the US because of Segment-C, who have the option of driving to the nearby Walmart.