Despite the recent overhaul of GST rates that came into effect on 22 September, many small kirana stores are yet to pass on the full benefit to end-consumers. From leftover inventory and relabelling bottlenecks to rising pressure from quick-commerce platforms, neighbourhood grocers find themselves squeezed between policy aspiration and ground realities.
“We still have two truckloads of rice, sugar and atta packs stamped with the old tax-inclusive MRPs,” said Asha Gupta, owner of Gupta’s Provision Store in Jayanagar, Bengaluru. “If I slash prices now, I will bleed cash. While some fast moving items may clear out fast, some times take time to move out of shelf. So we plan to pass on some benefit after Diwali, when most of this stock will likely be cleared.”
Another shopkeeper, Dinesh Gowda of New Provision Mart in Bengaluru, said: “I run on 15-day credit. If I cut prices on all my stock immediately, my cash flow breaks. Customers see the ads, but they don’t see my inventory ledger. I will adjust the prices for the most essential items first, but the full drop will only come in December.”
Most kiranas run on razor-thin margins and short credit cycles (often 7–15 days). Many merchants say they prefer a phased approach by starting with staples like flour, pulses, soap and extend cuts to the rest over weeks or months, depending on cash flows and demand.
In Chennai’s T. Nagar, R. Velu of Velu Stores said the big companies sent us notices on the new rates, but the newly stamped stock hasn't arrived yet. "The customer expects a 13 percent drop on that shampoo bottle now from 18 percent to 5 percent GST, but I paid under the old rate. Usually my stock remains for 30–60 days and if I sell it at the lower price, who will compensate me? Distributors may give us credit, but not cash for the loss.”
Similarly, in Hyderabad’s Kukatpally, Naseer Ahmed of Good Grocery Corner said: “I’m fearful that if I reduce margins now, I might run out of cash before the next delivery. I’ll pass savings gradually after the harvest season, once purchases slow down.”
He added that, “In late October and November, business moves slower. Probably I will announce price reductions in December, once cash is steadier and demand is more visible.”
Additionally, Kirana owners agree that beyond inventory logistics lies a deeper structural threat with quick-commerce platforms like Blinkit, Zepto, Instamart and others offering steep short-term discounts and 10–30 minute delivery, they have curtailed footfall and sales for many small stores.
Gupta said: “In the last couple of months, I lost dozens of regular customers to the apps as they offer 20–30 percent off and deliver in 10–15 minutes. I can’t match that, so I must protect my profit margins.”
A senior executive from an industry federation (requesting anonymity) said: “Kirana operators are in a bind. If they drop prices immediately, they risk destabilising their cashflows; if they wait, consumers and regulators might complain. Many plan to hold onto current prices for the next 2–3 months, then pass on relief once seasonal buying slows.”
The industry body source added that stores in rural or peri-urban areas may lag further, since their turnover is slower and logistics cost is higher.
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