NEW DELHI
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Attire retailers count on demand to choose up over the following two quarters, after witnessing lukewarm gross sales within the competition season and winter.
A tepid marriage ceremony season coupled with a hotter December dragged down demand for clothes, mentioned a number of prime retailers. Customers are additionally spending on different discretionary classes comparable to journey and consuming out, straining demand for merchandise comparable to clothes and electronics.
“2022 noticed an enormous upswing in demand for attire as a result of after a very long time—i.e., (after) two years of covid—customers stepped out, went again to malls and customers purchased lots. In consequence, their wardrobes have been roughly full,” mentioned Rahul Mehta, chief mentor, Clothes Producers Affiliation of India (CMAI).
“More and more, after covid, clothes is now not a standing image. Clothes as a class is now competing with different discretionary merchandise comparable to electronics and different home-linked EMIs and, subsequently, you see much less demand for the class,” he added.
Mehta mentioned demand is anticipated to stay muted within the ongoing yr as effectively. “Could also be within the subsequent yr the cycle will flip.”
Attire and footwear gross sales in FY23 have been down 8.9% after posting a robust progress of 28.6% in FY22, in response to the personal ultimate consumption expenditure knowledge launched by the federal government for FY23 final month.
In the meantime, a delayed winter within the month of December additionally led to a listing pile-up for clothes manufacturers.
“Finish of season was OK—the whole business was sitting on numerous merchandise until December finish and getting nervous. We couldn’t actually see the climate altering; nonetheless, demand shot up in January, however by then, everybody had commenced gross sales. Therefore, profitability was hit as manufacturers liquidated inventory,” mentioned Sanjeev Wadhwani, guide, Killer Denims, a part of Keval Kiran Clothes Ltd.
Wadhwani, nonetheless, mentioned demand for summer time clothes is reporting an uptick already, with franchisee companions related to the menswear model stocking up for the season.
“For the final 4 quarters, progress within the attire market has been type of muted; particularly for lots of listed attire gamers. A variety of these manufacturers additionally had a problem with stock as a result of they purchased lots and so they weren’t capable of promote. So, in the event you see within the final 4 months, numerous these manufacturers have been on prolonged gross sales and so they’ve been attempting to liquidate stock,” mentioned Ambuj Narayan, CEO, Taneira, an ethnic put on model underneath the Titan Co.
“So far as we’re involved, we had an excellent competition (season) and even the marriage season was excellent for us. We don’t have a listing challenge as a result of we managed our stock very effectively. We’re eagerly ready for the summer time season to kick in,” Narayan added.
Retail gross sales grew 7% within the months of October and November when in comparison with a yr in the past, in response to the Retail Enterprise Survey by the Retailers Affiliation of India (RAI) launched in December 2023. Retail gross sales have been up 5% in January this yr, RAI mentioned, including that shopper demand for attire and electronics remained muted.
“Retailers had anticipated double-digit gross sales progress in the course of the Puja and Diwali season in October and November 2023 nonetheless, the gross sales progress has been muted for a lot of retailers…Many retailers, particularly within the attire class, solely grew over final yr due to new retailer openings and on-line gross sales,” RAI mentioned then.
Others mentioned elections might kick off consumption. “We should always see some enchancment within the first quarter,” mentioned Lalit Agarwal, Founder & MD, V-Mart Retail Ltd.
Supply: Live Mint