How Kiranas Are Powering India's FMCG Boom with 907M Internet Users

With over 13 million outlets, kiranas aren't just keeping pace they're leading the charge by embracing digital payments, offering hyper-local delivery, and building trust within their communities.

India’s FMCG market is surging, projected to become the world’s thirdlargest consumer market by 2030. But what’s at the heart of this boom? Kirana stores. These mom-and-pop shops, long considered the backbone of India’s retail ecosystem, are stepping up with agility and innovation to dominate this dynamic landscape. They’ve outpaced competitors by embracing digital payments, providing quick delivery, and maintaining personal connections with customers — all while catering to an evolving consumer base that’s increasingly digital-savvy and convenience-oriented.

Despite urban markets generating 65 percent of FMCG revenue, rural areas remain a focal point for the industry, says a recent report. With over 13 million stores nationwide, the humble kirana holds an astounding 70-80 percent share of FMCG sales, outshining organized retail and e-commerce. They offer convenience, credit, and flexibility, bridging the gap for rural consumers and forming habits that persist even when customers migrate to urban areas.

THE FMCG MARKET IN 2024

India’s FMCG sector has surged post-pandemic, recording a 12.2 percent year-on-year growth in Q2 2023. Yet, behind this rapid growth lies an emerging divergence between affluent and unaffluent consumers. The agility of these stores has allowed them to adapt to the dual demands, stocking both affordable and premium products.

Traditional kiranas are also quick to adopt technological upgrades. With digital payments now a fixture, these stores seamlessly combine old-school personal service with new-age convenience, capturing a significant portion of India’s consumer base. And despite global challenges like rising commodity costs and unseasonal rainfall, which have led to price hikes, kiranas have maintained a steady footfall due to their affordable product lines and community connections.