Metros ditch stores for qcom; retailers adopting tech to counter decline

Retail stores in India are integrating CRM tools, online ordering platforms, and inventory management software to counter onslaught of ecom and qcom, says a new PwC study

Traditional retailers are facing mounting challenges from e-commerce and quick commerce (qcom) platforms. A decline in store visits due to the convenience of quick delivery services is particularly evident in metros and Tier-I cities, according to a new PwC India report, ‘The Retail Reinvention Paradigm’.

 

The study found that 52 per cent of retailers reported sales drops in food and beverage categories due to qcom. However, adoption is slower in smaller cities, where delivery costs and fragmented demand pose logistical challenges.

 

To counter competition, traditional retailers are adopting digital tools and customer engagement strategies. Around 53 per cent of retail stores surveyed have yet to implement advanced technology solutions, but many are gradually integrating customer relationship management (CRM) tools, online ordering platforms, and inventory management software. Some retailers are also offering home delivery, flexible return policies, and personalised shopping experiences to attract and retain customers.

 

The study was based on surveys with over 1,000 retailers and 800 consumers, PwC said.

 

Brick-and-mortar retail remains strong in smaller cities 

However, despite the aggressive expansion of Q-commerce — growing 73 per cent annually — traditional retail remains resilient, particularly in Tier-II and III cities, the report noted. Independent retailers in these regions continue to thrive by offering personalised service and maintaining strong local consumer relationships. However, they seek government support for fair logistics, delivery, and pricing policies to compete with online platforms on equal footing.

 

Multichannel shopping gaining popularity

  The survey also highlighted that consumer habits are evolving toward an omnichannel approach. While 77 per cent of Indian shoppers prefer brands that offer both online and offline options, preferences vary by category. Personal items such as apparel and beauty products are increasingly bought online, while household goods, fresh produce, and high-value purchases still see strong offline demand. Around 50 per cent of consumers prefer a mix of online research and in-store purchases, highlighting the need for brands to blend digital and physical retail experiences.

 

“Customers don’t want to choose between online and offline. They want both. Some days, they prefer shopping from the comfort of their homes, while on other days, they enjoy walking into a store and experiencing the products firsthand. We have to be ready for both scenarios,” the report quoted an apparel store owner.

 

Low ONDC awareness slows retailers’ digital adoption 

The PwC report noted a significant gap in awareness about the Open Network for Digital Commerce (ONDC), a government initiative aimed at empowering small retailers against ecommerce giants. Only 4 per cent of traditional retailers are aware of ONDC, and a mere 1 per cent are accepting orders through the platform, indicating the need for greater outreach and education efforts.

 

Around 64 per cent of traditional retailers believed that fairer delivery and logistics policies are needed to ensure equitable operations across retail formats. Additionally, they sought better access to technology, tax relief, and financial incentives to modernise their stores and compete with digital-first brands, the report noted.