No more chasing jobs, graduates are turning shopkeepers-OkCredit Insights
There’s a particular imagery that comes to mind when one thinks of a shopkeeper- sparsely educated, between 20 and 40 years in age, ceaselessly taking orders on phone with one hand and packing stuff with another. For this neighbourhood “bhaiya” or “uncle”, only three things matter- customers, inventory and his bahi-khata (the account register). Now, picture a retail store owner in the same age group, but genial, well-informed, inclined to technology, using apps for his business needs. There is a stark difference in customer experience at both these stores.
While there are a bunch of factors responsible for this change, one of them is educated folks, particularly graduates getting into unorganised retail. Neighbourhood stores in India have typically been run by semi-literate, less educated individuals, some of who join it as a family owned business. For others, it’s the easiest source of livelihood, if they aren’t qualified enough for a job.The barriers to entry are so low that anyone with a basic minimum qualification can open a shop.
While this is true even now, Covid-19 has altered the scenario, partially. Rising unemployment has meant that graduates who would earlier prefer jobs, are now looking at unorganised retail as a viable source of livelihood. At OkCredit, we have credible data that shows this in reality.
In our annual study released this year in March, the demographic data gave a true picture of this change. Even though, across age groups, owners of small businesses lack education, in the 35–45 age group, a decent chunk of business owners are graduates. Covid-19 may have been the forcing factor but this also points to a mindset shift among the educated class who have typically preferred “safe” jobs over business.
For an outsider, this shift may seem trivial, but it’s significant for two reasons- First, as more of educated class joins unorganised retail, there will be an increase in the usage of business apps. Young and educated typically have a tendency to adopt what’s new in technology and if it impacts their business positively, they are likely to get hooked. For apps such as OkCredit, this is great news.
Second, this will lead to an improved customer experience at retail stores- be it in terms of product selection, layout of the store or checkout experience, it has been seen that these aspects matter a lot for someone who is educated. Simply put, the band of 35–45 year olds will play a key role in elevating both customer experience as well as app usage.
Take for example Vishnu Prasad’s Ambe General Store which he has been running for 25 years in the Nawabganj area of Barabanki, a district in Uttar Pradesh. There’s nothing unique about the shop which gets a set of loyal customers for staples and grocery products. However, things changed last year when Prasad’s 38 year old son Rajeev started sitting at the shop. Rajeev used to work at a logistics startup in Delhi NCR till 2020. In the second wave of Covid, his firm laid off a number of employees including him. That’s when he came back to Barabanki. In a few days, he was ready with the changes the shop needed. One of the things that irritated him the most was reminding customers to pay their due.
As a first step, he migrated existing credit records on OkCredit. With in-built reminders, credit started coming back faster than he had expected. Next, he added a dedicated corner in his shop for cosmetics, bringing a bevy of women customers.
Education has never been a determinant for success in retail but as more graduates come on board, a transformation is inevitable.
