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  • Manika Gupta

Grocers hit by rising food prices & quick e-commerce channels

To meet the challenges grocers are innovating





According to the latest figures, the Consumer Price Inflation (CPI) jumped to 5.5% due to higher food prices.


What is more, the vegetarian food like pulses, rice, onion and tomatoes jumped substantially on a year-to- year basis. So if you are a vegetarian, it would be more expensive to eat than if you were a non-vegetarian as the cost of poultry slipped by 13%.


The cost of vegetarian food was impacted largely by increase in prices of onions and tomatoes. Prices of rice also went up in the recent past. The cost of pulses also went by substantially.


High grocery prices and new online stores have made it tough for the grocery vendors.  Let’s see what the vendors have to say on it.


Manoj Pandey, owner of 6 stores called Oqua Naturals across Delhi and NCR said the grocery prices have gone up by almost 15% in 2023.  If we take the price of wheat only, it has gone up by almost 14% and increase in the price of rice could even be more.




Turmeric, for instance was Rs 100 per kg in wholesale, but now it’s gone up to Rs 300 in the same market. So the customer typically gets it for Rs 35 to Rs 40 per 100 grams. Even the vegetable prices have increased by 30%.




Similarly King Chick’s Satyendra Sharma who owns 4 meat stores in Noida and Delhi sells non-vegetarian food frozen and ready-to-eat. He said that there was an almost 15% increase in food prices. He said this has greatly impacted his sales by almost 30%.



Impact on selling capacity:

A slowdown at India’s grocery market has intensified towards the end of 2023, when quick commerce companies gained a larger share of the staples business. Manoj Pandey said that it is impacting the store’s selling capacity. He said due to expensive products and the other quick e commerce channels like Blinkit, Big Basket (BB) and Zepto, people are buying less from the shops. “If there is a growth in the market, the advantage of the growth is being taken by these quick commerce guys.”


He feels, the customers may not be getting too much benefit as even the online portals are taking too much profit from the customers, while making them feel good.


Mudit Gupta who had a store in Sector 75 by the name of Dry Fals and Crockery Walla had to close his store due to high grocery prices and competition from quick e commerce operators. He said, “Here the culture is not like Delhi where people still like to go to the market and buy the stuff. Here, in Noida extension, it’s mostly the high rise buildings and people simply go online and buy even if the products are sub-standard”.  It could be because here most youngsters are leading a fast-paced life and don’t have the time to go to a real market place, he said.


Innovative solutions:

As a solution Manoj Pandey has started live stores in all his outlets. He has live stations for grinding and milling as well as provision for providing cold pressed oils in his stores.


He said wheat or other masalas are ground in front of you and the oil is milled in front of you through the method of cold press. The element of doubt is completely removed from the customer’s mind.


He also said that I plan to provide farming solutions to customers who can get their produced farmed in the way they want.


Another strategy that the companies are following is to call their products as organic products and the customers are willing to pay much more for the same products.


As for Satyendra Sharma, with sales down by 30%, the best way is to spend more money on marketing. He said while earlier I used to spend 5% on marketing, now I spend more than 25% of my budget on promoting my products.


There is a lot of competition with online players like Green Chick, The Sardar Meat Shop etc.

  



 

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