IndiaRetailBiz

Indian Council for Research on International Economic Relations (ICRIER), according to a DNA Money report, appears to have come to the conclusion that the country’s traditional kirana (moom n pop) stores have been able to adjust to the emergence of organised retail in the country.

In the wake of a missive on livelihood security of small traders in the country by the UPA chairperson Sonia Gandhi to the Prime Minister Manmohan Singh, the government had earlier this year appointed the premier think tank to study impact of FDI and big business houses’ entry into retail on 12-odd million kirana (mom & pop) stores.

The report was ready in August, 2007, however, the government decided to enlarge the scope of the study as besides buying more time the government was keen to assuage the feelings of its allies in the Left, who since beginning are opposed to the entry of big business in retail.

Though, the government was initially keen on preparing a comprehensive retail policy for the country based on findings of the report, this would, perhaps, recede in background as the ruling the congress, depending on the chain of events, may like to call general elections in the near future.

ICRIER, which according to Rajiv Kumar, its Chief Executive and Director, has completed consumer and trade surveys is preparing to submit the report to the government by this month end after completing the process of peer review.

After extensive surveys and discussions, the premier agency appears to have concluded the following:

• The mom-n-pop stores have so far been able to adjust to the emergence of organised retail and malls.
• Impact of modern retail on the profitability of small stores wears off with time. This is based on comparison of the South (where organised retail emerged much earlier) with the North.
• None of the small stores are affected by organised retail to the extent that they want to move out of this business. In fact, a majority of the next generation of those owning mom-n-pop stores, despite the advent of organised retail, want to continue in the retail business.
• Customers are not averse to the existence of big retail since they derive value from both the organised retail and mom-n-pop stores.