Local grocery store’s loss is supermakets’ gain

Cashless transactions forced people to big shops and malls

Eighteen grocery stores downed their shutters in the last one year and another 25 shops are on the verge of closure following the demonetisation move that was unleashed on the public a year ago. Other shops have found a drop of up to 60% in the quantum of daily sale. And, where is this business going to?

The answer is simple and straight: supermarket chains and malls. Since none of the grocery stores was equipped with the card swiping facility at the time of announcement of demonetisation, people spotted the supermarkets and malls as the lone alternative to make cashless transactions for groceries. By the time the small traders got themselves equipped with swiping devices, it was too late to retain the business, as people got used to the new generation stores.

Of the 218 grocery stores in the city, only 192 remained in the business, of which the future of about 25 shops is at stake. “The shops that are in the bracket of selling commodities worth ₹5,000 to ₹6,000 a day were the worst affected. Both the wholesale shops and the tiny ones in the slum areas are in the safe zone,” observes Boda Ravikumar, proprietor of Raviteja Products and president of the Kakinada Kirana Merchants’ Association. In other words, the small merchants lost their customer base from the middle class, which has turned into the obvious gain for supermarket chains.

“The interesting point is that people from the rural areas on the city’s outskirts too are acquainted with the supermarkets and are visiting the city exclusively for purchasing groceries,” points out Mr. Ravikumar, admitting that the shopping experience in the malls is entirely different from that of the local grocery store. “Men prefer grocery stores, as they can avoid the unnecessary expenditure. Whereas, women and children are keen on visiting the malls,” he says.

The ironic part is that some of those who have closed their shops are now turned into workers at wholesale grocery stores and those who are on the verge of closing their business too are thinking on the same lines. “We don’t know any other job except this trade,” says K. Suresh of Ganilakshmi Kirana Stores.