After 2020 Boom, Dukaan Tech Startups Eye Full Stack Future For Kiranas


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The likes of Dukaan and DotPe’s DigitalDukaan app have recently enabled merchants to manage payments digitally to enable transparency

Startups such as Bikayi and Peel-Works are looking to go beyond helping kirana stores create online catalogues and manage their entire operations digitally

As retail tech evolves, more such solutions will be seen in the market that seek to not only enable basic digital enablement or digital ledgers, but end-to-end solutions

In 2020, everything changed for local stores and kiranas in India as the need for digitisation has been felt across cities in India. This has fuelled the rise of retail tech startups in India, targeting the mom-and-pop stores as well as other retail outlets. According to an Inc42 Plus Analysis, digitisation of the Indian retail sector alone has provided SaaS startups an opportunity of more than $2 Bn. This led to the emergence of retail tech startups such as Growthpond’s Dukaan, Aarzoo, Kirana King, Shop Kirana, Peel-Works, Khatabook’s MyStore, Dotpe’s DigitalDukaan, OkCredit, Bikayi, MSwipe, Magicpin and many more.

While it did make sense for merchant-focussed platforms like Khatabook, OKCredit, Mswipe and Dotpe to enable digital transformation tools and widen their service repertoire, those who had already focussed on kiranas and small stores added new features through the year, with a bigger focus on digital payments and other value-added services as more and more shopkeepers came online.

After 2020 Boom, Dukaan Tech Startups Look At Full Stack Future For Kirana Digitisation

India’s Dukaan Tech Landscape Matures

Growthpond’s Dukaan recently launched its digital payments features to allow merchants to make advance payments for their orders through existing payments service providers. This not only cuts down on the possibilities of return orders due to non-payment but also brings more transparency in terms of expected income.

Dukaan founder Suumit Shah told Inc42 that digital payments integrations has led to good response from customers, with about 13% of all transactions now happening digitally since the launch in January 2021. The company has claimed to have processed gross merchandise value of INR 105 Cr through this integration.

While Dukaan is certainly not the first to add digital payments to record transactions with merchants, this is an important step in the maturity of this segment. Earlier, apps relied on merchants manually entering transaction details and payment records, which led to time-wastage, errors and miscalculations.

This also led to allegations of apps faking transactions or the number of merchants onboarded. The digital advance payments feature makes things much more transparent. Dukaan is far from the first startup to bring this feature. Dotpe’s DigitalDukaan offered digital payments solutions for stores in the first place, while other apps such as Justdial also enabled shopkeepers, service providers and merchants to accept digital payments in advance for services offered.

The idea is to add the bits and pieces that shopkeepers and kirana store owners are looking for in the near future to become full-stack kirana digitisation platforms. While payments is one component, other startups are looking at delivery and logistics support as well as inventory management as the value-additions in the current phase of retail tech development.

Hyderabad-based Bikayi said that its biggest differentiator is the delivery integration with companies like Delhivery and Shadowfax, which means stores and sellers can charge distance-based delivery fees and use the network of these delivery partners.

Besides this, there are also other retail tech platforms like Kirana King, Walmart (Mera Kirana), Metro and ShopX that offer complete transformation of kirana stores and revamp their entire distribution channel by integrating technology-enabled solutions for digital payments, inventory management and assortment.

One of the older retail tech startups in India, Mumbai-based Peel-Works is also looking to provide end-to-end services to small and medium-sized shopkeepers. Its marketplace Taikee helps kirana owners discover new products, private labels and brands, while Peel-Works manages the fulfilment and next-day delivery. Besides this, the 2010-founded startup offers inventory management, and data from Taikee is also used by financing partners to fulfil working capital needs of the network stores.

As retail tech evolves, more such solutions will be seen in the market that seek to not only enable basic digital enablement or digital ledgers, but end-to-end solutions. And this is why many think that the 2020 boom for kirana tech will continue unabated in 2021 too.

With Traction Comes New Value-Added Services

In 2020’s great kirana digitisation wave, Dukaan claims to have onboarded 2.7 Mn merchants between July to October 2020, while Khatabook’s MyStore noted 2.5 Mn userbase between August and September. Fintech startup Dotpe’s DigitallDukaan noted at least 1 Mn download in 2020. In fact, a recent study by EY found that 79% of kirana stores in non-metros and 50% in metros saw new customers come in post-March. Factors like wanting to avoid long queues at supermarkets, wanting to choose one’s own items and the trust shared with long-standing kirana store owners all contributed to the renewed interest in kirana purchases.With this came investor interest.

Dukaan grabbed $6 Mn in the middle of its legal battle with Khatabook, and Bikayi raised a $2 Mn seed round within a year of launch. Similarly, Peel-Works raised $3 Mn in October to expand its network of mom-and-pop and kirana stores on the Taikee app across the country.

With inputs from Nikhil Subramaniam





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