Call it a late arrival of winter or subdued consumer mood, retailers are seeing lower than expected sales growth in the days leading upto Christmas.
Like Diwali, Christmas is one of the crucial sale periods for retailers and most of the retailers saw 15-25% like growth in pre-Diwali sales this year.
“It is good. But not like Diwali sales. Retailers expected more than 15% like to like growth. Its slightly lesser than that,” said Alok Dubey, CEO of Arvind Lifestyle Brands, which sells US Polo, Nautica, Arrow and so on.
However, the company is seeing total growth of 20% over last year, which is also coming from opening new stores, he said.
Said an executive from European group who did not want to be identified: “Sales are above budget but we expected explosive sales due to improved range. Jacket sales have not taken off to a great extent.”
“Women’swear is doing good. We have to see how men’swear will sell this weekend,” the executive said. Some retailers are hoping for things to pick up from December 20 weekend.
“Pre Christmas sales will start pick up from last weekend before Christmas. I am confident that it will see good pick up,” said Himanshu Chakravarthy, CEO, The MobileStore.
However, mall developers say they are seeing good growth in footfalls and sales.
“We had 30% growth in footfalls and traffic in pre-Xmas sales,” said Anupam T, CEO, Malls at Runwal group.
Added Deva Jyotula, general manager, KORUM mall: “The footfalls and sales typically start increasing in the week of Christmas with families spending time in malls to enjoy the festive décor, to shop for Christmas and New Year and to watch new movies. A similar trend is being seen this year.”
Fashion discounted sales
Many fashion brands have advanced their discounted sales by 10-15 days this time around to clear their inventory. During December last year, many brands advanced their sale by 7-10 days to clear their stock.
“Lower than expected sales is the reason behind brands starting discounts early. But it will have impact on retailers margins,” Sanjay Behl, chief executive of Raymond.
Added another executive said, “Winter wear has not taken off well due to delay in arrival of winter. That is the main reason behind early discounted sales,” he said.