In a routine quest to purchase Pantene Pro-V 185 ml for his wife, one individual stumbled upon a revealing encounter at a local Kiryana store.
Disappointment struck as the owner, Rasheed, lamented the stockout of the sought-after product, shedding light on a broader issue faced by many retailers. Rasheed disclosed losing approximately 10% of potential sales due to such stockouts, sparking a conversation about the challenges hindering the adoption of digital solutions in the retail sector.
Rasheed’s reluctance to invest in a POS system due to its high cost and the need for skilled personnel illuminated the barriers preventing many traditional retailers from embracing digital tools. This encounter underscored the urgent necessity for affordable and accessible digital solutions to empower and revolutionize the traditional retail landscape.
Despite the significant role the retail sector plays in Pakistan’s economy, with over 2.5 million Kiryana stores dominating 80% of the grocery market, digital adoption remains low. Only 10% of retailers are equipped with a POS system, and a mere 5% hold a bank account, indicating substantial hurdles in embracing digital tools.
Government initiatives aimed at formalizing the sector, such as the FBR’s requirement for Tier-1 retailers to integrate POS systems for automatic sales transaction reporting, are commendable steps towards digital empowerment. Additionally, the SBP’s Raast P2M service, facilitating digital payments through various methods, highlights efforts to accelerate Pakistan’s transition to a digital economy.
Challenges such as high costs of POS hardware and limited access to loans for inventory financing hinder digital adoption among retailers. However, the emergence of new players in the retail tech space, offering solutions like digital wholesale, stock replenishment, and micro-loans, signals a promising shift.
Introducing solutions like Aladdin Smart Dukaan, a cost-effective ERP platform, showcases the potential for affordable digital solutions to revolutionize traditional retail operations. Testimonials from retailers like Rasheed emphasize the tangible benefits of such innovations, from eliminating stockouts to improving profits and enabling better work-life balance.
