India’s extensive network of kirana stores, traditionally dependent on fragmented distribution systems, is experiencing a digital transformation. A recent study by Redseer Strategy Consultants has revealed that this shift is largely driven by the increasing adoption of B2B e-commerce platforms, with udaan at the forefront.
According to the study, titled ‘B2B ecommerce Opportunity in India,’ kirana stores are increasingly turning to digital platforms, like udaan, to streamline operations and overcome the inefficiencies of traditional procurement methods.
The report emphasises the significant role of udaan in Bengaluru's retail ecosystem. Approximately 80 per cent of the city's kirana stores now rely on udaan’s platform, which facilitates around 15,000 daily transactions. This deep integration into the local market highlights the platform’s growing dominance, further underscored by udaan doubling its buyer base over the past year.
“Udaan is transforming the future of eB2B retail by empowering kiranas and small retailers with unmatched access to a wide variety of quality and affordable products, and credit while leveraging technology,” said Vaibhav Gupta, Co-founder and CEO of udaan. “Our rapid growth in Bengaluru and Hyderabad is just the beginning. We are committed to revolutionising the eB2B retail landscape across Bharat, expanding into new clusters, and driving efficient and profitable growth for millions of small businesses.”
The report also spotlights udaan’s innovative 'Micro-Market Strategy,' which has been a key factor in its success in Bengaluru and Hyderabad. This strategy focuses on regional markets and customizes offerings to meet local demands, leading to a 1.2 to 1.4 times increase in buyer penetration and wallet share in key cities. This approach, coupled with tailored product assortments and high customer satisfaction, has helped udaan secure a competitive edge over its peers, many of whom are struggling to match its growth and operational efficiency.
Anil Kumar, Founder and CEO of Redseer Strategy Consultants, commented on the evolving landscape: “The Indian B2B kirana market is on the cusp of a remarkable transformation as digital platforms revolutionize traditional trade practices. Our report highlights strong growth driven by digital adoption, with eB2B solutions reshaping supply chains and improving efficiencies. Kirana stores now have unprecedented access to products and financial services, marking a fundamental shift in how businesses operate and thrive in the coming years.”
Traditional supply chains, which have long been fraught with inefficiencies, intermediaries, and increased costs, are being streamlined by eB2B platforms like udaan. These platforms eliminate middlemen, offering faster deliveries, better inventory management, and enhanced demand forecasting, enabling kirana stores to operate more efficiently. The platforms also provide access to formal credit, allowing stores to expand their product ranges and improve cash flow management, further distancing themselves from unreliable informal credit systems.
Looking ahead, Redseer's study suggests that udaan and similar platforms will continue to expand and replicate their success in other regions. The future of the digital B2B sector in India appears promising, with platforms expected to capture an increasingly large share of the retail market as they grow their product offerings, develop private-label strategies, and enhance market penetration.
