Slowdown Shadow On Big Festive Season Biz

Gloom looms at markets as people curtail shopping plans, retailers brace for season with maximum caution & minimum stocks

- Ajita Shashidhar

Stung by crashing sales and unsure of consumer sentiment this festive season, automobile and consumer durable firms are entering the 4-month phase with extreme caution and bare minimum stocks.

As the festive season approaches, these companies ramp up inventory, plan new launches and offer deals to meet higher sales target. However, this season is different and expectations are low.

Most auto firms, for instance, are approaching the season like a regular period, without ramping up stocks at all. "It is difficult to forecast how the festive season will be this year. We have stopped forecasting anything beyond four hours,” says Pawan Goenka, managing director, Mahindra & Mahindra. "The industry will not make the mistake of overestimating demand as in the last festive season, which led to a huge inventory pile-up at the dealers.”

The automobile industry normally carries a month’s inventory, which is ramped up to 2-3 months in the festive period.