The E-commerce companies mopped up over USD 3 billion during the Navarathri Sales late September / early October, we read in newspapers. That’s a small blip compared to the total business that usually happens all India during that period. To give a perspective, only Kolkata garnered a Sales turnover of Rs. 4,500 Crores and the State had an estimated Rs. 15,000 Crores in Sales during the Pujo Week, the Dasera Festival which is celebrated with much fervour Eastern India, especially West Bengal. For the rest of India, the Deepavali fortnight is the highest grosser akin to "Black Friday" Sales of the West (minus the discounts, usually). Most brands in the Electronics, Consumer Durables and Household Appliances businesses record 40% of their Annual Turnover during Q3 – October to December during when three important festivals occur and are celebrated all India – Deepavali, Eid and Christmas – New Year block.
Having contributed to Amazon and Flipkart during the Big Billion Days ahead of Dasera, decided to open up my wallet at Offline Stores for my Deepavali shopping.
Visited the iconic Express Avenue Mall in Chennai last week after a long time. Why after a long time? Because I moved to a new house late last year and don’t live closer to the Mall anymore. And there are enough stores across categories nearby current home. Looking at the sparse crowds all over, I had doubts if the mass media was actually correct about a possible slowdown.
At least 6 CEOs / Heads of Businesses who run International / National Brands in India I spoke with over the past few days – and have known them personally, confirmed there’s no slowdown in Sales overall. Some said they have a single digit growth (over last year) and some said double-digit. Unfortunately, most of them told me not to quote them for this article.
H&M on the other had revealed stunning sales for the past year although it’s not clear whether the Chennai store had a Y-O-Y increase in Sales or otherwise. At Rs. 1,236 Crores, it was 39% more than last year while it’s Profit grew a neat 29%. Zara, grew 17% to Rs. 1,438 Crores compared to last year. H&M & Zara operate 42 & 22 stores respectively in India. Meahile, Japanese Uniqlo opened a store at tony DLF Mall in South Delhi earlier this month and garnered a Sale of Rs. 2.20 Crores in the first two days. India's largest Department Store chain Shoppers Stop has been going through quite a metamorphosis under Rajeev Suri who took over a turbulent company two years back. Here's what he had to say to the Economic Times on where they are headed. Lifestyle, Dubai based Landmark Group's flagship chain has it various stores reporting mixed numbers, thanks to various geo-social changes in the consumption patterns.
After seven fulfilling years in a healthy JV with the Tata Group, Starbucks aims to break-even this FY with an estimated store count of 185+ cafes all India. Dominos Pizza, India's largest F&B chain reported a 12% growth over last year while most other F&B companies, organized or semi-organised have seen a significant increase in Sales despite the hype over Food hailing Apps such as Swiggy and Zomato from whose channel, restaurants garner about 15-20% Sales. Even local eateries and restaurants have not seen a significant dip in outlet sales, which is usually compensated with online orders. A few local players have shut shop indeed but that's due to internal inefficiencies.
The Multiplex industry, on the other hand is on a roll with PVR Cinemas, the market leader recording 25% more admits, 37% increase in Total Income and 149% increase in EBIDTA and 35% increase in Net Profits while there is a slew of films in Hindi, Tamil, Telugu and more Indian languages slated for release soon and which are expecting a big round of BO in the coming months. Minister Ravi Shankar Prasad claimed he was quoted out of context when he described the economy in healthy mode comparing the BO outcomes of a few films. And the American theory of Entertainment Industry doing well during a slowdown - well, probably yes for them but not in Indian when most Indians are scrambling for 3 meals and a healthy, wealthy living even when the Economy was apparently doing very well.
There is NO Slowdown as is being projected everywhere in Mainstream Media. Yes, some industries have seen correction in the way they are run – from neighborhood Pharmacies to Auto-Dealers. Local Pharmacists cannot purchase medicines anymore without a valid GST Invoice which has affected their business overall since most small shops have never been used to paying VAT. Auto-Dealers were being dumped with stocks by Automobile Companies in the name of Primary Sales which has seen a collection. Commercial Vehicle Sales have come down, thanks to better quality of vehicles manufactured over the past decade, a faster TAT of trips thanks to GST and limited / nil local bureaucracy and of course the diesel price impact being absorbed by everyone in the value chain.
No Indian has stopped spending or planning to stop spending. If people were buying a lot of grocery and vegetables, they have reduced shopping but this has been well compensated with Swiggy and Zomato Sales! And similarly in every other industry.
There is absolutely no scope of a RETAIL APOCALYPSE in India yet. Not for the next 30 years at least. Stop worrying and start spending like before.
Happy Deepavali.
