Supermarkets v Traditional Indian markets: Shoppers vie for convenience, comfort

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A vegetable vendor selling fresh produce in a market in Ahmedabad, India. Traditional markets hold a very special place in the hearts of Indian people, fulfilling their day to day needs. Photo - Sonali Dalal

Foreign supermarkets are set to launch their retail operations very soon in India and are promising their shoppers a world-class experience that centres on quality, excellent customer services, cleanliness, and better bargains. This is a far cry from the shopping experience at New Delhi’s markets like Chandni Chowk and Karol Bagh where shoppers’ argue with shopkeepers as part of the bargaining, wade through sewage and garbage strewn narrow streets, wary of pickpockets and walk distances due to lack of parking spaces.

Despite its disadvantages, India’s traditional markets form bulk of the retail sector that is worth around $450, a staggering figure that has lured global retailers just like the European colonial powers in 16th century.

Supermarkets are keen to contrast their shopping experience with tiny shops where tempers flare over a slew of issues – product quality, pricing, discount, return or warrantees. Incessant power cuts make matters worse and push tolerance threshold of shoppers. Western-style luxury malls and hyper markets are presented as exactly the opposite of bazaar experience where shopping is more like an airy breeze.

“Of course I’m scared for my business. Wouldn’t a small elephant be afraid of a giant elephant chasing them?” Dinesh Kumar Trehan, a 49-year-old owner of a small shop in Karol Bagh, said while selling bags and belts.

And Trehan is not alone in the country of more than a billion souls. According to Mckinsey, a global management consultancy, India has an estimated 12 million retail outlets and boasts the highest shop-customers density in the world.

While rapid modernisation has swept almost all the aspects of consumer life, from 3G mobile connectivity to foreign branded cars to modern airports, Indian traditional markets and shops remain largely untouched in what is part of a $1.6 trillion economy.

Despite their spacious and convenient shopping experience, supermarkets in India have failed to take off due to several reasons. While consumer groups insist people prefer buying from their neighbourhood shopkeeper who they’ve known for years, retail chains insist poor infrastructure, inadequate funding and government regulations have impeded their progress. Mckinsey estimates multinational chain stores like Carrefour, Tesco, Wal-Mart etc. could claim a 25 per cent market share of the Indian urban society.

Some Indians are more curious about the supermarket shopping experience rather than being comfortable with it.

indian supermarket
The grocery section of an Indian supermarket. Photo - Fitch.com

“Supermarkets are more convenient because you don’t have to run around to different shops and bargain with the shopkeepers,” said Ginni, a 29-year-old accountant, while shopping in a narrow street in New Delhi.

PRO-CHOICE

Ginni is part of the new middle class that is looking out for comfortable shopping experience that comes with the lure of “special offers”. She promises never to come back to the shops in Delhi’s narrow streets if there is a supermarket around. Many other men and women from Indian urban class would gladly swear to something similar.

The supermarkets also promise to give a uniform experience across every city and town in India, something that traditional markets will never ever be able to provide.

Whether it is New Delhi, Hyderabad or Mumbai, supermarkets are air-conditioned and are dotted with posters that offer cooking oil, detergents, vegetables and rice on discounted prices, sometimes as low as 30 per cent compared to the market.

“At the supermarkets, there’s bigger quantities, more choice, better products, and you’re guaranteed that things are fresh,” said Karishma Gundewadi, as she pushed a shopping trolley in a sprawling mall in Mumbai.

Not too happy with the small-sized daily shopping experience, she remained skeptic about the future of millions of Indian shopkeepers. “Who knows how long some of the things in the small stores have been there? … I think, as India changes, most of the smaller shops just won’t survive,” she insisted.

But the transformation of Indian retail sector promises to be challenging and trouble-prone.

Millions of small traders, backed by political parties, took to the streets in Uttar Pradesh in 1997 when Reliance Industries tried to open Western-style supermarkets in India’s most populous state. The India’s biggest listed retail company has to backtrack on its plan after the huge public outcry and diminishing support from lawmakers.

Shopkeepers and small traders form the bulk of support for most of the political parties in India and their swing ensures election victories for political parties and independent candidates alike.

PURCHASING POWER

But it is not all about comfort, convenience, luxury and politics. Majority of India’s lower middle class and working class simply cannot afford the shopping mall experience amidst tough economic conditions marred by rampant inflation and rising food prices.

“Only those families who’ve got enough money can afford to buy things from the mall. People like me can’t buy goods from the mall and supermarkets,” said Trehan. As in any other part of the world, purchasing power matters, something that the global retail chains need to keep in their mind.

“For the small things, the 1 rupee, 5 rupees, people come to me,” says Vilas Perde, as he sold a small bag of dried chickpeas to a taxi driver for 2 rupees ($0.04) in Mumbai.

“But for the big things, the expensive things, they can go elsewhere,” he said, pointing towards the brand new building that houses a supermarket across the street.

While modern supermarkets may offer everything from a needle to refrigerator, they cannot offer the luxury of providing betel nuts and chocolates at your doorstep, even on credit, while you laze in the couch watching an exciting cricket match or engrossing soap opera in the evening.

(By Moign Khawaja with input from Reuters)

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