After the retail industry saw a near washout yet again in the second wave, apparel retailers are now pinning their hopes on the festive season as they see a strong return in demand among consumers to come and shop from stores.
Kumar Rajagopalan, CEO of Retailers Association of India says that without a third wave, the industry could grow by 10 percent over pre-COVID levels. Retailers such as Raymond and Lifestyle too, are expecting double-digit growth this festive season.
Raymond says that there are enough green shoots are being seen leading up to the festive season shopping, with early trends indicating a double-digit growth in like-to-like stores compared to pre-COVID period, and a 50 percent growth over the festive season of 2020. The growth, it says, will be aided by the fact that the festive season will last longer given the late Diwali and then followed by wedding season, which would also aid growth.
Lifestyle too is seeing sales pick up week-on-week. “And with the festive season around the corner, markets such as the East where Pujo shopping is soon to begin, the outcome looks promising. The festive season looks positive and we are expecting double-digit growth this year,” Devarajan Iyer, CEO of Lifestyle Stores told CNBC-TV18.
Sanjay Jain, CEO of apparel manufacturer PDS Multinational Fashions Limited added, “I believe the festive season should witness strong traction in India, with the festive season kicking off with Ganesh Chaturthi in September going till early January with Christmas and New Year’s. PDS is also seeing a strong trajectory/recovery across its markets”
Onam last month served as a prelude to the upcoming festive season where the industry saw good demand despite restrictions in Kerala. Westside says that not just Onam, even Eid and Rakhi has indicated strong demand.
“We are very optimistic about the festive season. Our Eid, Onam, and even Rakshabandhan gave us the confidence that the customer is aching for a celebration for almost two years of shut down and isolation,” Umashan Naidoo, Head of Customer, Westside – A Tata Enterprise said.
The festive season growth, the industry says, will be led by ethnic wear and occasion wear across men, women and kids. In addition, Raymond and Westside also see an increase in the casual wear category, a trend that has dominated the apparel industry thanks to work-from-home in the past year.
Westside’s Naidoo adds that along with ethnic wear, sales of casual and loungewear will shoot up as well as staycations are only going to get bigger and will not fade away anytime soon.
Online sales too will play an important role in aiding festive sales for retailers as consumers have increasingly moved online during the pandemic.
“In India, offline players have faced challenges due to changing COVID guidelines, however, with the speeding of the vaccination drive, we should see good footfalls compared to 2020. Having said that, the online platforms will continue to make the most of it. We have already seen a shift to online portals for shopping over the last 18 months, this festive season is expected to ride on the same trend,” Sanjay Jain of PDS said.
However, a possible third wave could prove to be a dampener for the retail industry. IF cases start rising and fresh restrictions are imposed, the retail industry stands highly impacted, facing store closure for the third time in less than two years.
RAI’s Rajagopalan says the sentiment in the industry, therefore, is cautiously optimistic.
“It can go either way. If we’re able to ensure the pandemic is under control and states don’t create new types of hindrances to the opening of markets, it could be one of the best seasons the industry has seen, better than even 2019 levels. There is some kind of need to come back to stores and buy. So it now depends on whether we're able to sustain our ability to ensure vaccination,” he added.
Retailers are also cautious about stocking up too much and are working closely with suppliers to ensure they’re not stuck with too much inventory. “Everyone keeps plans close to their chest. They don’t want to overindulge and land themselves into a situation of too much stock and not enough sales. The last thing they would want is to have stock levels higher than 2019 and then pandemic catching up,” Kumar adds.
(Edited by : Aditi Gautam)
First Published: IST