Walmart vs. Kirana Shops

VS.


In a recent article published in DNA Money: http://www.dnaindia.com/money/interview_it-is-not-easy-to-compete-with-kirana-stores-rajiv-lal_1416054

There were comparisons made between the strengths of Walmart and the strengths of the Kirana Shop. While Walmart might take over large consumer bases with its bulk and cheap prices, Kirana Shops have service and relationships that Walmart will be able to compete with...

General Description:

1. Purchases product on ad-hoc basis from wholesaler at haats (varied)

2. No sales reporting, no stock tracking, no regular purchase schedule

3. Gets avg. 10% margin on FMCG


Challenges

1. Inability to manage products or set a clear purchase pattern

2. Cannot manage funds , lack of financial planning

3. Too dependent on outside demand - do not attempt to create demand for products


Frontier Markets believes that Kirana Shops are the BEST suppliers for local households because there is a trust factor, convenient location, and these shops service households in various ways.

Through our model, Frontier Markets will build a network of retailers that are not only providing similar services and maintaining relationships, but they will be providing demanded products with high quality backing.

We will be building their capacity in the following ways:

1. Bring them into a network of preferred retailers

2. Build capacity for marketing and sales reporting

3. Provide consistent demand for products from FM field staff activities with BOP
consumers

4. Tie retailer to consumer, wholesaler and MNC company


Added Value

1. Better Sales Performance: Increased sales from consistent, aggregated consumer base and consistent demand

2. Better Margins: Gets better margins from FM wholesaler

3. Competitive Advantages: Marketing and sales knowledge is a
competitive advantage to other shops

4. Performance Rewards: High performers are rewarded directly
from the MNC