Singhal said it wasn’t clear what they were working on, as most Kirana people were already taking orders via WhatsApp and having them delivered to their homes. The only explanation, he said, is a global glut of capital poking around for investment opportunities in an era of low interest rates. “For me, the excitement is due to this unfettered money pressure that forces these entrepreneurs to ignore economic consciousness,” he said.
Anand Ramanathan, partner at Deloitte India, said there are few signs that the funding tap will close anytime soon. Investors have been pouring money into Indian startups for at least a decade, scrambling to gain a foothold in a country whose overall consumer market is worth $6 trillion by 2030. World Economic Forum“Will any of these models be profitable? Is it sustainable? They’re not even close,” he said. “It’s just a customer acquisition game.”
India does have characteristics that are more suitable for fast trade than Western countries. Indians buy groceries more frequently than shoppers in developed countries, and its crowded cities make it possible to reach large numbers of customers from a darkened store, Zepto’s Palicha said. “This model thrives on density,” he said.
There is evidence that Kirana people are starting to feel the pinch in parts of India’s largest city. In a residential area on the border of HSR Layout, an up-and-coming suburb in south Bengaluru that has become a major startup hub, shopkeepers agree that online shopping is cutting into their profits. Ashraf Puncheehar said business in his store has dropped by 20 per cent in the past six months. “Every day new companies come online,” he said. “You can’t compete with them.”
Local layoffs are possible, even if the Kiranas are unlikely to suffer widespread deaths anytime soon. That could lead to a process known as “infrastructure exclusion,” says anthropologist Aaron Shapiro of the University of North Carolina at Chapel Hill. In the West, the shift from neighborhood stores to hypermarkets has seen companies abandon what they see as “unviable markets” in impoverished areas, resulting in “food deserts” where residents struggle to access healthy, affordable groceries. In India, the phenomenon may have a unique flavor. Mohammed Ryaz, a regular at a kirana in Chamrajpet, said the store was a lifeline for less tech-savvy customers during the lockdown. “These people are not educated – they don’t know how to place an order [online],” He says.
Another concern is the impact on delivery drivers. more than 80% India’s economy is informal, which means that workers do not have formal employment contracts and are not protected by employment laws. So, for many Indians, gig jobs are not significantly different from their alternatives. But the unpredictability of wages due to odd jobs and incentive-based earnings still plagues many gig workers, says Aditi Surie, a sociologist at the Indian Institute for Human Settlements (IIHS). “It actually made people feel this inner sense of instability,” she said. “You can’t really calculate what’s going to happen to your paycheck next month.”
A Dunzo delivery driver, who did not want to be named, said he didn’t mind the job and often worked 12-hour shifts. But it was only really worth his time when he hit his incentive goal of 21 orders a day, which boosted his salary by nearly 50%. “It would be a waste if I didn’t get any reward,” he said. “All my hard work was in vain.” He usually hits his goal 8 to 10 days a month.
lend a helping hand
Why, if India already has a hyperlocal retail network perfectly adapted to the needs of each community, should anyone pay to build a new one? Many “Kirana tech” startups see no need. Instead, they’re building tools to help stores compete with the behemoths of modern retail. “We see the country’s network of kirana stores as national infrastructure that may rival the power grid or railroads,” said Prem Kumar, chief executive of digital technology company Snapbizz.