Food and Grocery Retail:Patronage Behavior of Indian Urban Consumers

India is referred to be a nation of shopkeepers with about 15 million retail outlets of all kinds. Of these, the majority are small neighborhood grocery stores called “kirana stores”. Food and grocery constitute a major portion of the private consumption. This offers a large potential market for the organized retail companies to tap into. However, the high proliferation of local kirana stores with their unbeatable advantage of proximity and customer familiarity questions the success of organized retail in this category. This study tried to find the responses and patronage behavior of urban customers towards traditional and modern food and grocery retailers. This paper reviewed various literatures to understand the factors which affect the patronage of various retail formats, especially in food and grocery purchase. Differences perceived by customers between the kirana stores and modern retailers are covered in the study to understand the influence of specific decision variables in the selection of a particular retail format. The inference is that “location convenience”, “customized services” and “easy goods return/exchange facilities” drive a customer towards kirana stores while “product choice”, “efficient store-management” and “value-enhancing services” attract customers towards modern retailers. This understanding of the patronage behavior helps the modern retailers to strengthen the elements of their retail offerings, which the customers value more.