Retailers across the country continue to report sluggish sales amid tepid consumption. Businesses are estimated to have recorded a 52% year-on-year decline in sales in August, a survey by the Retailers Association of India (RAI) released on Wednesday showed.
While the western and northern parts of India witnessed a 54% y-o-y fall in business last month, the southern market seems to be placed comparatively better, having registered a 46% y-o-y dip in sales during the period.
Although retailers, estimated to have reported a near 90% y-o-y drop in sales in April, have pared losses to an extent, the path to recovery is still a long one, RAI said.
The revival is being led by the consumer durables segment that saw about 23% y-o-y decline in business in August. Segments such as jewellery and watches along with quick service restaurants (QSR) have seen a substantial degrowth in business, at over 60% y-o-y last month.
Businesses have failed to attract decent footfalls since resumption of operations in a phased manner starting early June. Consumers have restricted purchases to essentials and need-based items. Discretionary spending is yet to pick up and even discounts have failed to spur demand so far. Some retailers have had to shut a few outlets after rental negotiations with landlords did not work out. However, retailers are increasingly betting on the festive season to revive consumption.
“Support from governments at local levels across the country with the assurance of no more localised lockdowns will help fast-track recovery of sales during the upcoming festive season to almost to the same levels as last year,” Kumar Rajagopalan, CEO, RAI, said.
Retailers making over Rs 300 crore in annual sales did better in consumer durables while small- and mid-sized retailers with sales below Rs 300 crore saw better consumption in the footwear and furniture segment, the survey showed. Large-sized retailers in the west are estimated to have recorded a 51% y-o-y decline in sales in August.