From Army Major to Kirana Merchant Saviour – Organizing India’s fragmented Retail Stores

The Spark for Entrepreneurship

Jumbotail’s Karthik Venkateswaran is an interesting man. He came from a middle class background and rose to the rank of a major in the Indian Army. After a decade of serving in the army, his heart bled for something else.

That something else was a larger goal – a goal of makings people’s lives better. Making people’s lives better is a common thread we see across a variety of entrepreneurs who are working on goals and problems that are very large. Karthik wanted to work in India’s large retail sector and on large problems but had no credibility. He chose to get some credibility since he had no entrepreneurial experience. He enrolled in Stanford where he met his future co-founder.

The Indian Kirana and Retail Sector

Like any other part of the Indian economy, the Indian Kirana and Retail Sector is large, fragmented and a combination of organized and unorganized brands. On the top are a few organized companies such as ITC, Unilever, Cadbury. In the middle are thousands small and medium brands. At the bottom are local small and home run brands. Products range from daily essentials such as rice, oil, pulses to cosmetics, snacks, ready to eat food amongst others.

$883 Billion in the year 2020, estimates put the Indian Retail sector $1.3 Trillion by 2024.

Kirana Merchants make up the bulk of the retail sector. At last count, there were more than 12 Million Kirana Stores across India. Most of these Kirana merchants are nothing but a mini version of the average super market. They stock practically everything that an average household needs. From cereals, pulses, fresh produce, dairy, cosmetics, the number of products stocked could range anywhere between 500 to 5000.

Like most small businesses, a family runs the average Indian Kirana. Since its family run, the kirana store has virtually no employees. The family or its members do not derive a salary. Further, cash remaining in the cash register caters to household expenses. Supplies from the store take care of any home needs. As a result, Kirana stores become vulnerable to economics ups and downs. This creates a glass ceiling and keeps them in a state of economic need.

The Retail Market Opportunity

Organizing these Kirana stores to increase their profitability and making them lot more efficient is a huge opportunity. Jumbotail’s Karthik Venkateswaran and others such as JioMart are eyeing this exact opportunity. The many advantages they offer are providing assured supplies, stable prices and an opportunity to tap the online market.

Jumbotail today has outgrown its roots in Bangalore and is spreading its wings across the country. How big can it get? What were the initial challenges? Which strategies and tactics are working? This and more in this episode.