“Demand is muted in the marketplace. This is partly linked to the slowdown in the market. Consumers are also postponing purchases; waiting for the economic climate to improve,” said Eric Braganza, president, Haier Appliances India.
According to Sunil D’Souza, managing director, Whirlpool of India, while the festive season
this year started slower than usual. "The pace has however picked up since the first week of October and we expect the momentum to build up across the country going to Diwali. With new product launches and a strong portfolio, especially at the premium end, coupled with attractive financing schemes and promotions across all our categories , we expect to post strong growth this festival season", he said.
D'Souza said, Whirlpool has doubled its efforts - from execution of its festival plans and advertising to ensuring full displays of products on shop floors, implementing the merchandising on the shop floors to communicating the finance schemes to consumers.
According to a top executive from a renowned manufacturer, the company is observing down trading in the market across regions. “Ticket sizes of purchases are shrinking. So, growth rates this festive season
are likely to be lower,” the official said.
Y V Verma, an expert on the industry, said, “Primary sales have been muted this year for the festive season.
Dealers are not picking up as much stock from manufacturers because they are not sure whether there will be enough sales at their end.” Verma, too, predicted that secondary sales (from retailers to consumers) growth could be flat or may dip this festive season.
While the overall muted sentiment among consumer is a primary factor that has impacted sales this season, one of the key factors for the disparity between growth figures between large urban centres and smaller towns, companies and experts said, has been due to the capacity of the retailers to attract footfall.
While large-format retailers like Croma and others have done relatively better, smaller, standalone retail stores have fared poorly. “Large retail chains have the capacity to pull consumers through customised promotional schemes and offers and this has so far helped them post better sales. But standalone, small outlets, most of whom don’t have that capacity, have struggled,” said Nandi.
Croma Retail, which operates 140 electronic retail outlets, has so far observed over 20 per cent year-on-year growth. According to Ritesh Ghosal, chief marketing officer, Croma, over half of the items priced over Rs 15,000 it has so far sold were through consumer finance.
Sandeep Tewari, president (marketing), Usha International, said the lower growth could also be due to waning effect of seasonality. “While earlier consumers used to wait for the festive season to purchase electronics and durables, now buying happens across the year. We, however, have not witnessed any slowdown so far and are hopeful of a healthy growth this season,” he said.
Sales of durables has not picked up yet beyond top metros like Delhi, Mumbai, Bengaluru
Sale in smaller cities and tier-II & -III towns remains subdued; dealer order lower stocks
Large metros post low double-digit growth but slowdown in other regions pull down overall growth figures
Smaller, standalone outlets fail to attract enough footfall as consumption slowdown continue
Industry experts fear a flat growth or a dip in sales this festival season
Large e-retailers like Croma post healthy double-digit growth; pull consumers through offers & schemes