SnapPulse – Retailer Survey

November 2020

We recently undertook a survey with several kirana store owners across 10 Indian cities to understand more their sentiments during the festival season (Dasara and Diwali) and the performance of various categories that is being sold that their stores. The cities that were covered include Delhi NCR, Mumbai, Pune, Ahmedabad, Bangalore, Chennai, Hyderabad, Kolkata, Surat and Jaipur. Here are our key observations:

Observation 1: The kirana store owners feel that the sales will be lesser during this year’s Diwali as compared to last year.

Observation 2: The kirana store owners feel that the sales of staples and categories like biscuits and coffee are higher than last year as more consumers are spending more time at home during the festive season. They have seen that the sales of more expensive cooking ingredients like butter, ghee, vanaspati, dry fruits have dropped which could indicate lesser quantity of sweets being prepared.

Observation 3: The kirana store owners feel that the interest in Personal care (grooming) and other items related to entertaining (like juices, ice creams, CSDs, sweets and mithai) have fallen while the sales of household cleaning products have gone up as the hygiene is still a topmost priority among the consumers during these times

Observation 4: More kirana store owners are expecting the companies/distributors to support them in terms of margins/discounts/offers on products and buy-back of products not sold. They are expecting new brands / products launches and merchandising materials from them.

Observation 5: As compared to last festive season, retailer celebration is subdued this year in terms of store decorations, gifts to employees and customers.

We have been closely monitoring basket-level data on SKU’s/ brands/ categories from kirana stores and sharing these insights with brands. If there are any categories or brands you would like us to deep-dive into, please write to us at vinay.s@snapbizz.com and we will be happy to share them with you.

Kirana store trends during Ganesh Chaturthi, Onam and Navroz in Covid-19 era

Navroz (Parzi New Year) | Ganesh Chathurthi | Onam

Covid-19 era has changed the way consumers purchased their groceries in the following ways: (a) what they bought (product mix), how they bought (frequency of purchases/visits, size of each purchase) and from whom they bought (online/offline).

We decided to decode the spending patterns of the consumers during three recent major festivals – Navroz (Parzi New Year), Ganesh Chathurthi and Onam and how Covid-19 has changed the buying behaviour at kirana stores during these festivals. We looked at the billing data across our network of stores (Mumbai, Pune, Bangalore and Chennai) for the following periods

• Navroz (Parzi New Year)
  1. Pre-Covid-19 era: 17^th August 2019
  2. Covid-19 era: 16^th August 2020
• Ganesh Chathurthi:
  1. Pre-Covid-19 era: 2^nd September 2019
  2. Covid-19 era: 22^nd August 2020
• Onam
  1. Pre-Covid-19 era: 11^th September 2019
  2. Covid-19 era: 31^st August 2020

Navroz during Covid-19

• • Grooming items and Floor cleaners were less priority for the consumers this year. This is possibly because of the lack of festival meet-ups with family/friends at home.
  • Due to lack of celebrations, consumers have also lowered their spends on food items such as packaged water, milk, sweets, confectionary and nuts
  • Consumer spend more on ghee this year than on Vanaspati which is otherwise used for preparing food items in bulk during celebrations

Ganesh Chathurthi during Covid-19

• There appears to have been a shift towards home preparation “Modak” and other sweets as the consumer spend more on rice flour, oil, and ghee
• What’s more interesting is that we also saw an increase in spending on utensil cleaners which indicated more cooking/washing at home and less of going out
• Consumers made certain trade-offs where they have spent more on sweets/mithais than on dry fruit and nuts.
• Grooming items and Floor cleaners were less priority for the consumers this year. This could be because of the lack of festival meet-ups with family/friends at home (This is supported also by the fact that there was lowered spend on coffee, orange/lime/lemon cold drinks, and packaged water.

Onam during Covid-19

• Grooming items and Floor cleaners were less priority for the consumers this year. This is possibly because of the lack of festival meet-ups with family/friends at home.
• We also saw an increase in spending on utensil cleaners which indicated more cooking/washing at home and less of going out
• Vanaspati (which is normally used for bulk cooking) was not preferred this year and gave way for ghee
• As there were no/lesser home meet-ups this year, there was lesser consumer spending on biscuits, dry fruits & nuts, milk, and coffee.

We have been closely monitoring basket-level data on SKU’s/ brands/ categories from kirana stores and sharing these insights with brands. If there are any categories or brands you would like us to deep-dive into, please write to us at vinay.s@snapbizz.com and we will be happy to share them with you.

New Kirana stores opening and thriving amidst the recession? Yes, it is happening!

With the country reporting its worst economic performance (23.9% decline in GDP for FY 2020-21 Q1) due to the lockdown imposed by the national government in March ’20, we have seen several companies of all sizes scaling down, winding up their businesses and laying off employees. India’s unemployment rate and overall joblessness worsened with urban unemployment rate shooting up to nearly 10% in August ’20. This means that one in every 10 people in urban areas cannot find a job!

Amidst all this doom and gloom, there are two traditional sectors that are defying this trend – Agriculture and Kirana Grocery Trade. Over the past few months, we have seen that kirana stores remained open inspite of the several lockdown related supply issues and servicing the needs of 1.4 Billion people in India; they have an extremely high fill rate (% no of products/SKUs that the store is able to provide to the customer) – much higher than the e-commerce players. Additionally, they are one of the biggest and currently, one of the most active employers in the country with each kirana store hiring 2-5 people for store operations. But what is really worth noting is that we are also seeing new kirana stores being opened in every nook and corner of the country – in the midst of the recession! Based on the initial reports, these new stores seem to be thriving and attracting new customers with their hyper local assortment, proximity/reach to the customer, enhanced in-store/ personalised customer experience and in most cases – online presence with their very own mobile app/e-commerce store.

In the midst of all these new store openings, SnapBizz has been playing an important role in enabling first-time new store owners to kick-start their store operations smoothly right from day one and take on the bigger established organised players. Here is how we have been helping them:

• Attract new customers by enabling store owners to send unlimited free push offers/promotions SMSs.
• Influence consumer behaviour favourably and Increase sales inside the store and showcase merchandise/offers with the use of SnapVision TV screen.
• Effectively manage the inventory inside the store and ensure no oversupply/out-of-stock situations.
• Enhanced check-out/billing experience with easy, quick and accurate billing.
• Take their store online instantly with SnapOrder – with their very own branded mobile app and receive online orders from the newly-acquired customers.

We are also providing the newly-opened kirana stores with inputs/ideas on how they can improve all aspects of their store operations – right from day 1. It is indeed a great feeling for all of us at SnapBizz when we see new kirana store owners placing their trust in us to help them embark on a new entrepreneurial journey during these challenging times! This only drives us to push our limits to make our solutions even better so that these store owners can fully leverage their strengths to gain a competitive edge and improve profitability.

Consumer-buying behaviour during Bakrid & Janmashtami in Covid-19 era

COVID-19 era has changed the way consumers purchased their groceries in the following ways: (a) what they bought (product mix), how they bought (frequency of purchases/visits, size of each purchase) and from whom they bought (online/offline).

With the major festive season ahead of us, we decided to decode the spending patterns of the consumers during two recent major festivals – Bakrid and Janmashtami and how COVID-19 has changed the buying behavior at Kirana stores during these two festivals. We looked at the billing data across our network of stores (NCR, Mumbai, Pune, Ahmedabad, Surat, Bangalore, Chennai and Hyderabad) for the following periods

• Bakrid:
  1. Pre-COVID-19 era: 1^st August ‘20
  2. Covid-19 era: 12^th August ‘19
• Janmashtami:
  1. Pre-COVID-19 era: 23^rd/24^th August ‘19
  2. COVID-19 era: 11th /12^th August ‘20

The interesting insights that emerged out of this study are given below:

• Trade-offs taking place: Due to the COVID-19 situation, we are seeing that the consumers are making certain trade-offs in terms of spends during the festive season. Due to the lockdown/movement restrictions/lifestyle changes, they are spending more on certain categories and reduced their spends on certain categories for the festivals.
• Lesser spending on grooming/household items: The consumers have spent less on grooming items and household cleaning items during these two festivals as compared to last year; the reason being that entertaining guests at home has come down /is non-existent
• Bakrid during COVID-19:
  • Dry fruits, nuts and mithais was preferred over home-made elaborate desserts/dishes (ingredients for baking/home-made desserts, biscuits) and confectionery
  • Consumers preferred buttermilk, lassi, colas and water/ juices prepared with water instead of orange/lime/lemon soft drinks
  • Categories that saw more increased consumer spending in Bakrid 2020 than in Bakrid 19:  Atta, Dry fruits, mithais, Packaged water, Buttermilk/Lassi
  • Categories that saw decreased consumer spending in Bakrid 2020 as opposed to increased spending in Bakrid 2019: Hair colour, Rice Flour, Baked goods,
• Janmashtami during Covid-19
  • Consumers preferred buttermilk, Lassi and tea over coffee and soft drinks this year compared to Janmashtami 2019
  • Confectionery items were preferred over dry fruits and nuts by the consumers this year
  • The consumers spent more on ghee products and curds/yoghurts this year but they did not increase their spends on butter
  • The consumer spend on packaged water, which increased by 26% during Janmashtami 2019, did not increase during the festival this year. It is due to the fact that the guests were not invited home for the pujas.
  • Categories that saw more increased consumer spending in Janmashtami 2020 than in Janmashtami 19: Incense sticks, Atta, Ghee, Yoghurt/Curd, Buttermilk/lassi
  • Categories that saw decreased consumer spending in Janmashtami 2020 as opposed to increased spending in Janmashtami 2019: Coffee, Packaged water, Non-cola carbonated drinks

Why the survival of kirana stores is crucial for Indian economy during Covid-19

With the rise of modern trade outlets and e-commerce players over the past decade, the naysayers, for many years, have been sounding a death knell for the Kirana stores. They gave out a long list of reasons stating why the Kirana stores will soon start disappearing from the Indian economy – citing reasons such as better offers, better store experience, wider assortment, and many more.  And how they been proved wrong in these uncertain times!

Kirana stores have always been crucial for the Indian economy for primarily two reasons:

• Employment: There are over 12 million Kirana stores with each Kirana store supporting 3-5 households. You do the math and you will see that these staggering numbers merely reflect the huge/massive employment that it generates (one of the biggest in the country) for the economy. In the current situation with the economy being in turmoil where we see massive lay-offs across all sectors, the survival of Kirana stores becomes even more crucial to ensure that the unemployment rate does not reach staggering levels.
• Infrastructure of national importance: They are an important infrastructure for the Indian economy: Just like massive infrastructure projects such as roads, power, rail, etc that keeps the economy running, the Kirana store network itself can be looked as one infrastructure of national importance that keeps the wheels of the nation moving – especially in the current situation. Currently, they are the ONLY ones that can and is fulfilling the needs of almost all 1.3 Billion people of the country and therefore any disruption to their operations/existence will only harm the economy not just in the short run but in the long run as well – which our country just cannot afford!

With most of the country being on a staggered lockdown, the entire nation of 1.3 billion is largely relying on Kirana stores for their essentials – foods, beverages, personal and household care products. We are now seeing a new normal emerging in terms of unexpected trends changing consumer behavior due to this new-found humble relationship between the local Kirana store and the customers who live around them. These customers now see them as the lone warrior during this crisis time. The current lockdown has changed Kirana store owner’s life and how. They are constantly re-inventing themselves as the weeks go by to solve the various demand-related challenges and supply-related challenges. In spite of increased demand and constraint supplies, the Kirana store owners have not resorted to unfair sales practices. From our data, we have seen that they continue to sell groceries at the same price (MRP) that they have been doing so before.

Digitization of Kirana stores

In order to ensure that these Kirana stores continue to operate at high levels of efficiency even during the time the Covid-19, it is imperative that they need to digitize their stores to tackle the demand/supply challenges associated with these uncertain times. Therefore, what the Kirana stores really need is a technology solution that will enable them to be integrated with the FMCG eco-system and capture value from the FMCG eco-system players such as FMCG brands, distributors, wholesalers, banks, fintech players, etc. They need a highly-specialized technology product that addresses the challenges associated with Kirana retail and of the FMCG trade in general.

SnapBizz and Kirana Store Digitisation

We have always been strong advocators of Kirana stores and we have always been doing our best to transform their stores into smart stores and improve their profitability. We have enabled them to leverage their strengths (store proximity, credit facility, trust/familiarity with the store owner, hyper-local merchandise) to improve their profitability.

With the view of new challenges being faced by the Kirana stores in the past few months, we have rolled out two new solutions for Kirana stores and distributors in the open market with minor modifications of its existing product-line for massive adoption:

• SnapOrder: A mobile app that enables Kirana stores of all sizes to go online with their supplies – instantly. The consumers can use the app to view available stocks and place orders directly with the Kirana stores – either for pick-up or for home delivery. This enables the Kirana store to manage demand efficiently and prevent over-crowding at the store.
• SnapSupply: A mobile app that enables FMCG brands/distributors to list their supplies online for their Kirana store network and enables the Kirana stores to place orders of supplies and streamline their supply-related operations.

We have seen massive interest from the Kirana stores for our SnapOrder mobile solution (B2C App) where we have seen 6x increase in the number of Kirana stores being on-boarded on SnapOrder mobile app per month

Being the only neutral platform for the Kirana stores in the country, we do not have any affiliation with a particular B2C/B2B player or with a particular FMCG company. Hence, we have earned the trust of these Kirana store owners and we have and always will work on protecting this crucial data (regarding the customers) of the Kirana store. Given our increasing relevance in the space due to the current circumstances, we are on a fast-track mode to build a network of 150,000+ stores across 42 cities and becoming a $15 billion platform by F.Y. 2023.

Key Insights in Kirana Trade – April 2020

We take a look at the trends relating to traditional trade i.e. kirana trade that have emerged during the month of April 2020. Over 1 million transactions recorded across our network of kirana stores were analysed using our proprietory SnapPulse solution. Here are the key insights:

• Increased consumer spends: The median basket which was around Rs. 650 in the first week of March has shot up to approx. Rs. 1000  (approx. 40%) in the first week of April and is now down to Rs 850 approx.
• Retailers by and large were quite empathetic to the situation: No-overbilling above MRP was observed over a large base of over 1 million transactions randomly chosen covering more than 94 product categories!
• Supply issues: There were several categories that continued to face supply issues through-out the month of April. The supply issues were mostly seen in staples and many other food categories.  Here are the categories that faced this issue:

• Smaller packs: We have also noticeably seen that many people were buying much smaller packs or in much lesser quantity of various categories. In fact they were buying more expensive alternatives in smaller pack sizes. This could be either due to supply issues or push by retailers (due to higher margins) or kids being at home. The details are given below:

• Regional/Local brands v/s National brands: There was a spike in regional/local brands probably due to availability (supply) and/or retailer pushing products with higher margins. There was a spike in the trails of certain regional brands Eg. Freedom (Cooking Oil), Sagar (Detergent powder), Ajay (Oral Care)
• Kirana stores go online: Home delivery has seen unprecedented increased. It has more than doubled across all dimensions – no of customers, no of orders, value of bill. The no of retailers and consumers using SnapOrder (retailers’ very own online app from SnapBizz) has gone through exponential growth – by more than 6x.
• Premium products v/s mass-market products: Across certain categories such as biscuits, personal care, beverages, snacks and bread baked goods and yoghurts, a above-normal sale of premium products was observed. It could be due to families spending more time at home, availability, retailer push etc. Eg. Garnier (Personal Care), Epigamia Greek Yoghurt (Dairy), Real (Beverages)
• Shopper Credit behaviour: Credit offered by retailers to the shoppers initially increase by 30% in mid-March and dropped sharply in April (even though bill amounts increased by 40%) – due to the credit customers have stocked up well in advance or (b) less store willingness to extend credit during uncertain times

We have been closely monitoring basket-level data on SKU’s/ brands/ categories from kirana stores and sharing these insights with brands. If there are any categories or brands you would like us to deep-dive into, please write to us at vinay.s@snapbizz.com and we will be happy to share them with you.

A deep-dive into the impact of lockdown on food categories – till Mid-April 2020.
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Here is an in-depth analysis on what consumers are buying at kirana stores as on 12th April 2020 during the lockdown.
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A deep-dive into the impact that the national lockdown has had on food categories for month of March 2020.
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Here are some of the emerging trends from across 7 cities at SnapBizz network of kirana stores in the past few weeks (as on 7th April 2020)
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