By Kv Kurmanathme

Copyright thehindubusinessline

As the country braces for the Goods and Services Tax (GST) slab restructuring, which begins on September 22, the kirana store ecosystem is a study in contrasts. At the ground level, kirana store owners exhibit a mix of nonchalance and cautious apprehension.

While some, like Suresh Kumar Agarwal in Hyderabad, are “not bothered much” and are waiting for software updates and new stocks, many others are unexcited but worried about how to price their existing stock.

A layer above, distributors and retailers are defensively managing their inventory. They are reportedly cautious about taking on new stock ahead of the deadline, leading to a significant 30-35 per cent dip in primary sales from FMCG companies.

FMCG companies, at the top of the chain, are proactively trying to manage the transition, pushing to clear inventory from their warehouses by offering discounts to distributors and reassuring them that GST credits on old stock are still available.

This multi-layered response highlights the varying degrees of impact and preparedness as the entire retail supply chain navigates the impending tax changes.

“How cheaper this or that product will be after the GST changes,” is a repeated question that Kiran, a kirana shop owner in New Delhi, faces from his customers.

“I am getting several queries. But I’m telling them that it will only be known on September 22, when the new rationalised structure comes into effect,” he said.

At the Mahboob Mansion Wholesale Market at Malakpet, the biggest groceries market in Hyderabad, Suresh Kumar Agarwal (name changed) was hooked to a small notebook, completing his daily target of ram koti, oblivious to the fact that a significant change in the GST slab structure is going to impact his business.

New rate structure

He said it would take two-three weeks for the transition to the new rate structure. “Customers can expect good savings,” he said.

“I’m not bothered much. I am not accepting any new stock at the old rates. The new stocks are yet to arrive. The software guy (Focus executive) said he would take care of the software upgrade to suit the needs of the new tax structure,” Agarwal, a GST registered trader, told businessline.

However, the bulk of the kirana stores, which don’t come under the GST purview, have no clue on how things are moving in the space but for the occasional updates from the media and distributors.

FMCG distributors pointed out that companies have been trying to push inventory from their warehouses to distributors and general trade stores ahead of the GST implementation. Many key FMCG players are offering discounts to distributors.

“But retailers are cautious in taking up new inventory ahead of September 22. They have cut back on inventory and only stock up on fast-moving stock keeping units (SKUs),” a FMCG distributor noted.

Primary sales

A senior FMCG executive noted that there has been a dip in stocking up from distributors and kirana stores in the interim, and there has been 30-35 per cent dip in terms of primary sales from FMCG companies to kirana stores.

Priya (name changed), a shopkeeper in Austin Town in Bengaluru, said price changes will likely be reflected only after the 22nd. “Companies are yet to inform us about any changes in packet sizes or revisions in prices,” she added.

Shahab (name changed), another kirana store owner across the lane, told businessline that his billing software will be updated automatically in the backend.

(With inputs from Jyoti Banthia in Bengaluru)

Published on September 18, 2025