Currency ban forces retailers to advance seasonal sales
Retailers have launched sales early to make up for the business lost in November due to demonetisation. Typically, the end-of-season sales start from the first week of January. Reliance Trends, Pantaloons, Jashn, Cottonworld, and Seven East among others have already started their sales.business Updated: Dec 22, 2016 11:26 IST
Retailers have launched sales early to make up for the business lost in November due to demonetisation. Typically, the end-of-season sales start from the first week of January.
Reliance Trends, Pantaloons, Jashn, Cottonworld, and Seven East among others have already started their sales.
Pantaloons, for instance, is running a winter sale offering discounts of up to 70%. Others like Shoppers Stop may also prepone their sales, said industry sources.
Many retailers saw their business fall around 20-30% in the weeks after demonetisation as customers postponed non-essential purchases amid a cash crunch, sources said.
Certain segments like premium and luxury apparel and footwear sales were hit hard.
Retailers such as Pepe Jeans that operate on a franchise model, said the distribution to franchisees also declined by around 25% due to the note ban.
While retailers and mall developers say there has been some bounceback in business in December, many are offloading their inventory through early sales. “Demonetisation impacted their merchandise levels and so some retailers have started sales early,” said Rajneesh Mahajan, executive director at Inorbit Malls.
Moreover, malls are holding events to attract customers. Inorbit Malls, for instance, held a clown festival and Viviana Mall hosted a wedding fest.
“In uncertain situation like these, the salaried class thinks twice before spending. So, we need to give them a reason to shop,” said Rima Pradhan, senior vice-president, marketing, Viviana Mall.
Retail analysts expect the discount sales to continue till the end of January.
“After November 8, everyone went back to the drawing board. Discounts and schemes are tried and tested, which is why they launched them early,” said Anil Talreja, partner at Deloitte.
While the early sales may boost retailers’ sales , their margins are likely to be impacted.
“Earlier, we would start our sale from the first week of January and end it after Valentine’s Day as the new season’s merchandise is delivered after that. But now we will also align our sale with the others from next week,” said Govind Shrikhande, MD, Shoppers Stop.