Gone is the mood to splurge during Diwali that marked the past few years. The festive spirit is strong this year, but the eye is on bargains and window shopping.
Buyers, who still have fresh memories of job losses and a credit crunch that hit the economy late last year, are typically trading down, switching from better brands to cut-price supermarkets for goods like clothes.
“The economy is reviving but sales will be down 15-20 per cent this festive season as buyers are still not upbeat about spending,” Atul Bhargava, general secretary of the New Delhi Traders Association, told Hindustan Times.
Many retailers said footfalls and sales are down compared to last year while organised retail chains like Big Bazaar and Spencer’s maintained optimism.
“Last year I did a business of Rs 1 lakh from just one section of my shop, this year I have not done even half of it,” said Bhupesh Khullar, owner of an apparel shop at Delhi’s bustling Lajpat Nagar market, a haven for Diwali shoppers.
“Unlike previous years when customers would walk in and buy multiple pieces of clothing for gifting, they are at best sticking to one this time,” he added.
Buyers said they were not exactly controlling their budgets but were looking
around markets, scouting for value-for-money deals. “Festive spending is unavoidable and we are not restricting ourselves. However, we are doing more window-shopping in the hope of getting a good deal,” said Rakesh Sharma, a finance professional.
“Sales are average, neither very good nor bad,” said Rajesh Juneja, owner of Sita Fabrics, a home décor store. However, the Future Group, which runs the Big Bazaar and Pantaloons chain stores, expects sales to be up at least 25 per cent on the year. “Buyers are perhaps downgrading but not holding back on festival spends, which are sort of unavoidable. We expect sales to be up 25 per cent over last year,” a spokesperson for the group said.
Spencer’s said its stores reported a 30 per cent rise in sales in September, which the festive season kicks off.
“We expect a 25 per cent jump in sales (for Diwali),” said Samar Singh Shekhwat, vice-president, marketing at Spencer’s.
Electronics companies like LG and Samsung that generate over 30 per cent of their annual revenues from festive sales are betting on zero-interest finance schemes and gifts.
Samsung is eyeing festive season sales of Rs 1,700 crore, a 40 per cent yearly growth.
“Last year, we did not have consumer offers but this time we have announced some schemes and complimentary products,” said Ravinder Zutshi, deputy managing director .
But the street reality could be different.
“People are walking in to stores but not buying,” said an official at a Samsung store.