Kirana Stores Are Still 91 Per Cent Of Grocery Market
The online commerce channels, which serves the urban, affluent, upper-middle class consumers for whom convenience is the driving factor for purchase, is a $19 billion market and is projected to reach $69 billion by 2030, growing at 29 per cent CAGR.
Chennai: Despite big-box stores, e-commerce retailers and quick commerce expanding fast in the Indian grocery retail market since 2000, kirana stores hold 91 per cent of the market and are expected to hold the dominant position in the coming years as well.
India’s retail ecosystem spans across big-box stores with hypermarket and supermarket formats, online retail with e-commerce and quick commerce formats, and kirana stores, serving distinct needs. While online commerce offers convenience, and big-box retail provides value and assortment, kirana stores remain the backbone of daily grocery consumption with their neighbourhood reach, personalised service, and trusted credit, finds a report by RedSeer Consultancy.
The big-box retail chains and hyper markets made an aggressive entry in the early 2000s in the Indian market. With a target segment of largely urban, upper middle, value-seeking consumers, these stores grew to a $40 billion market by 2025 and are expected to be $74 billion by 2030, growing at 13 per cent CAGR.
The online commerce channels, which serves the urban, affluent, upper-middle class consumers for whom convenience is the driving factor for purchase, is a $19 billion market and is projected to reach $69 billion by 2030, growing at 29 per cent CAGR.
Meanwhile, kirana stores serving the middle, lower-middle, low income groups, which represents 80 per cent of India’s demographic, is a $598 billion market in 2025. It accounts for 91 per cent of the grocery market, growing at 7 per cent CAGR, and is projected to become $849 billion by 2030.
India’s grocery market is anchored by its largest cohort - low-to-mid income households, whose low-average order value, high-frequency baskets are served most efficiently by kiranas. Higher-income segments diversify into supermarkets, quick commerce, and online channels as purchasing power rises. Despite this diversification, kiranas are expected to hold 86 per cent of the grocery market in 2030.
Quick commerce is expanding quickly, reshaping convenience-led shopping once dominated by supermarkets and e-commerce. Quick commerce already accounts for 47 per cent of the online grocery market and is projected to reach 67 per cent by 2030, outpacing e-commerce with a 35-40 per cent CAGR. However, it is not affecting kirana stores much.