It is also not clear what problem they are solving, says Singhal, as most Kiran already accept orders via WhatsApp and deliver to the doorstep of customers. The only explanation, he says, is global capital oversupply, which is groping investment opportunities in an era of low interest rates. “For me, this excitement is due to this unrelated pressure of money, which forces these entrepreneurs to oppose economic meaning,” he said.
There are several indications that the money taps will close soon, said Anand Ramanathan, a partner at Deloitte India. According to the World Economic Forum, investors have been throwing money at Indian startups for at least a decade, trying to strengthen themselves in a nation whose common consumer markets could cost $ 6 trillion by 2030, according to the World Economic Forum. “Are any of these models making money?” Is it sustainable? “They’re not even close,” he said. “It’s just a game to attract customers.”
India has features that can make it more suitable for fast trade than Western countries. Indians buy groceries more often than buyers in the developed world, says Palicha of Zepto, and crowded cities allow large numbers of customers to reach from a dark store. “This model thrives on density,” he says.
There is evidence that in parts of India’s largest cities, Cyrans are beginning to feel a pinch. In a residential neighborhood on the border of HSR Layout – a growing suburb in the south of Bangalore, which is emerging as a major startup center – traders were unanimous that online shopping reduces their profits. Ashraf Punchihar says the business in his store has shrunk by 20% in the last six months. “Day after day, new companies appear online,” he said. “You can’t compete with them.”
Even if the Kiran are unlikely to die widely soon, localized redundancies are possible. That could lead to a process known as “infrastructure shutdown,” said Aaron Shapiro, an anthropologist at the University of North Carolina at Chapel Hill. In the West, the shift from neighborhood stores to larger supermarkets has forced companies to abandon what they see as “unviable markets” in poor areas, leading to “food deserts” where residents have limited access to healthy and affordable food. In India, the phenomenon can acquire a unique taste. Mohamed Ryaz, a regular customer at the Chamrajpet kirana, said the store was a lifeline for less tech-savvy customers during the blockade. “These are not educated people – they do not know how to place an order [online],” he says.
Another concern is the impact on supply drivers. More than 80% of the Indian economy is informal, which means that workers do not have a formal employment contract and are not protected by labor laws. So for many Indians, working with concerts is not much different from their alternatives. But the unpredictability of wages due to sporadic work and incentive-based remuneration still worries many concert workers, said Aditi Suri, a sociologist at the Indian Institute of Human Settlements (IIHS). “It actually leaves people feeling that inner sense of insecurity,” she said. “You have no way to really calculate what will happen to your salaries next month.
A Dunzo delivery driver, who did not want to be named, said he did not mind working and made 12-hour shifts regularly. But it is really worth his time only if he achieves the goal of stimulating 21 orders a day, which increases his salaries by nearly 50%. “It’s a loss if I don’t get any incentives,” he said. “All my efforts are in vain.” He usually achieves the goal eight to 10 days a month.
Why, if India already has a hyperlocal retail network perfectly tailored to the needs of each community, does anyone have to spend money to build a new one? Many kirana tech startups have decided that there is no need. Instead, they are creating tools to help stores compete with the giants of modern retail. “We see kirana’s network of stores in this country as a national infrastructure, probably comparable to power grids or railways,” said Prem Kumar, CEO of digital technology company Snapbizz.