The retail landscape in India is undergoing a significant transformation, but for many local shops and small businesses, the change has been challenging and, in some cases, devastating.
Industry experts report that customer footfall at local stores has declined sharply over the past few years. This year alone, an estimated 150,000 local shops, including kirana and small retail stores, have shuttered their operations across the country. The decline is especially pronounced in urban and semi-urban areas, where the rise of quick commerce platforms and aggressive online discounting has fundamentally altered consumer shopping habits.
Currently, India is home to approximately 13 million local retail stores, with a majority located in tier-2 and smaller cities. These shops have traditionally served as the backbone of India’s retail ecosystem, offering personalized service, convenience, and trusted relationships built over generations.
However, the rapid expansion of quick commerce—instant delivery services offered through apps—has created fierce competition that many small retailers are struggling to meet. With platforms offering deep discounts, lightning-fast deliveries, and a wide product range, local shops are losing their customer base and seeing their profit margins squeezed thin.
“This sudden shift towards aggressive pricing and heavy discounting by online platforms has disrupted the level playing field, making it nearly impossible for small shop owners to compete,” said a senior representative from a leading retail association. “We are witnessing not just a decline in sales, but a real threat to the livelihoods of millions of small business owners.”
The festive seasons, which once guaranteed a surge in sales for local shops, have now become stagnant or declining periods. Many shopkeepers report that despite their best efforts, customers prefer shopping online due to convenience and pricing, leaving traditional retailers struggling to survive.
Data from multiple sources reveal that metro cities have borne the brunt of this disruption, with over 90,000 local stores closing down recently. Smaller towns and rural areas are not immune either, with thousands of shops shutting their doors due to diminishing demand and increasing operational costs.
Industry bodies are urging policymakers to introduce regulations aimed at protecting local retailers. They stress the importance of creating a sustainable retail environment where small businesses can coexist alongside emerging e-commerce players.
“The aggressive strategies adopted by some quick commerce firms prioritize short-term market share over sustainable growth, threatening to erase the very fabric of our traditional retail sector,” warned a senior official from a national retail federation.
Calls have also been made for investigations into predatory pricing and anti-competitive practices by major quick commerce companies, with appeals to India’s competition authorities to step in and ensure fair competition.
As the retail sector evolves, the future of local shops hangs in a delicate balance. Supporting these businesses is crucial not just for economic diversity but for preserving the social and cultural fabric that local shops have long upheld in communities across India.