Ahmedabad: Demand for consumer items, apparel yet to pick up

AHMEDABAD: Come festive season and markets are usually buzzing with people frequenting retail stores to make their purchases. Contrary to expectations, this time around, many retail stores wear a deserted look with festive season demand in the retail sector taking a hit.
Estimates by garment manufacturers and traders of consumer durables indicate that sales have declined by 40% at least, amid rising inflation, weakened purchasing power of people and the onslaught of e-commerce players.
According to estimates by Gujarat Garment Manufacturers’ Association (GGMA), the state’s apparel industry clocks business worth around Rs 4,000 crore in the Navratri-Diwali season alone. “The sales revenue during the festive season remains around Rs 3,500-4,000 crore every year. However, instead of growing upwards from there, the sales have remained slack this time. The business may touch a maximum of Rs 2,000 crore across Gujarat,” said Vijay Purohit, president, GGMA.
Garment manufacturers have already cut down production amid low demand. “Several manufacturing units have cut down production by roughly 30% in the wake of poor sales. Customers do not have adequate cash on hand to be able to splurge on festive purchases, amid rising inflation,” said Arpan Shah, a city-based apparel manufacturer.
Wholesale and retail traders of home appliances and electronics also claim that sales have plunged due to the onslaught of online players. “E-commerce players are indeed eating into our business. Retailers are in no position to offer as much discount as their online counterparts, due to which our customer base is shifting to online shopping. Traders have not procured extra stock of consumer durables as the sales are down by around 60%. Apart from online retail, various customers are deferring their purchases,” said Sunil Motwani, vice president, Relief Road Electronics Retailers’ Association.
Trade experts indicate that sales have declined significantly due to weakened purchasing power of customers. “Prices of essential items have increased including those of petrol and diesel. Due to this, people’s monthly budgets have gone haywire, leaving little funds to spare. Moreover, with the recent fall in the stock markets, investors’ money is held up, as they will not withdraw their investment to make losses. These are the various factors that have weakened the purchasing power of customers, thus denting traders’ revenues,” said Jayendra Tanna, president, Gujarat Traders’ Federation (GTF).