India’s biggest consumer goods companies — including ITC, Nestlé, Coca-Cola, Tata Consumer, Dabur, Reliance, and Parle — are shifting their attention back to traditional retail. After a year of deepening relationships with quick-commerce players like Blinkit, Zepto, Instamart, and BB Now, the focus is now returning to kirana stores — the country’s true retail backbone.
According to The Economic Times, these companies are now actively working to repair strained ties with their distributor networks. This includes expanding product options available to kiranas, smoothing out supply chain kinks, and offering better margins to small retailers — a move driven largely by pushback from distributors, who claim online platforms have been receiving more favourable pricing and terms.
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Take ITC, for instance. The company has adjusted its distribution model to help kirana shops stock more premium offerings, while also rolling out targeted incentives for higher-value outlets — a signal that it’s ready to re-invest in long-term channel loyalty.
Kiranas Still Hold The Fort, Despite Digital Hype
While quick-commerce continues to grab headlines and funding, the numbers tell a different story. General trade — powered by an estimated 13 million kirana stores — still handles over 90% of India’s FMCG sales. And this traditional system isn’t ready to take a back seat just yet.
In fact, tensions have been simmering. Many distributors say the rise of app-based grocery delivery has come at their expense, citing unfair pricing models and better margins being handed to online channels.
Things reached a boiling point on June 16, when the All India Consumer Products Distributors Federation (AICPDF), which represents nearly half a million members, called on FMCG firms to level the playing field. Their demands? Price parity across all sales channels and proper vendor contracts that recognise and protect traditional distributors.
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With the pressure building, legacy brands are being forced to rethink their priorities. Kiranas may not offer the speed or data of digital platforms, but they still hold the trust of millions — and in Indian retail, that trust is worth more than any algorithm.
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