Small kirana stores have started feeling the heat of inflation wave. At over 11 percent, inflation has resulted in lower stocks and falling sales, casting doubts on their medium-term existence. Some have shut shop, while others are considering getting into new businesses.
"We have started keeping lesser stocks (reduced by up to 25 percent) owing to inflation," said Bharat Shah, owner of Jatin Traders in Kandivli, a suburb in North Mumbai. "Prices of products like rice and pulses have gone up by more than 1.5 times. The sales are clearly falling."
Compared to a monthly business of Rs 5-6 lakh, Shah's current monthly turnover is down by a third to around Rs 3.5-4 lakh. "It is fine if business improves, otherwise many of us are in a situation where we may have to close down." The challenges for small retail and departmental stores are not limited to any one city to retailers across Delhi, Ahmedabad, Hyderabad and Kolkata, inflation has hit low-income groups hard, which in turn has taken its toll on the business of retail stores. From 5 litre packs, consumers are shifting to 1litre packs and preferring cheaper brands for all their purchases.
"While earlier we used to clock sales of Rs 8000 daily, now it reaches only Rs 6000," said C.H. Srinivasa, proprietor and owner of a 300 sq feet medical and general store in Hyderabad, who is feeling the pinch. "Consumers purchase medicines in the form of individual units instead of buying the whole pack." These retail shops are hit as salaries of people who do small-time jobs have not risen in proportion to the rise in inflation.
"After the recent fuel hike, sales have been immediately hit by 25 percent," said Darshan L. Mehta, whose brother runs a 100 sq feet kirana store in Paldi, Ahmedabad. "In fact, some small shops have also shut down, especially those located in and around malls."
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