Slump in demand hits festive cheer in market
The slump has been attributed to households tightening purse strings due to rising costs
After a devastating second wave of COVID-19 when the government eased restrictions, traders were pinning their hopes on the festive season from Ganesha to Deepavali to recover losses. However, with the price of fuel and essential commodities spiralling, festival cheer remains elusive.
Many retailers across sectors said that consumption levels are down while others pointed out that it is not as high as they had hoped for. This is because households are tightening their purse strings due to rising costs and festivities are low key, they said.
Sajjan Raj Mehta, a cloth merchant in Chickpet, said business volume usually increases by over 150% during the festival season, but this year business levels were lower than usual, leave alone festival swell. “People do not have money in hand. We traders are marginally better off than during the lockdown,” he said.
Retailers in the home appliances sector have a similar story. “We do big business during the festive season. People wait to buy home appliances. Discount offers during the season have also become an institution. But this year, we are not seeing any rise in business, despite big discount sales,” said Purushottam, a manager at a leading home appliances chain store.
Dasara – Deepavali is the peak season for dry fruits traders who rely on bulk orders from companies and individuals. But business is bad in this sector, too. Idrees Choudhary, a leading dry fruits merchant in Bengaluru said business this season was not even 20% of the usual. “This time of the year, my regular customers such as corporate firms, PR agencies, those in the hospitality sector, etc usually place bulk orders for gifts. Most have not placed any orders this year,” he said.
With people cutting down on outings to save costs, the restaurant industry is also going through a lean phase. “The fast food sector is doing ok, but it’s viability is severely challenged by rising costs of LPG cooking gas cylinders, edible oil, vegetables and fuel in general. It’s the fine dining restaurants that have taken the biggest hit. They hasen’t recovered since the pandemic,” said Chandrashekhar Hebbar, president, Karnataka Regional Hotels’ and Restaurants’ Federation.
Even grocers and street vendors are feeling the pinch.
B.P. Raju, who runs a provision store in Vidyaranyapura, said most houses have a fixed expenditure for monthly groceries and won’t be able to overshoot it by a large extent. “Most households slashed grocery budgets ever since the pandemic. Now with prices rising, they get a smaller quantity of groceries for the same amount but they are not increasing their budget so we are selling less,” he said.