At a time when the global pandemic situation has worse hit the world than the Bubonic Plague in the 14th century or the SARS Epidemic of 2003, it is indeed alarming to see millions of Indians nonchalantly shopping and roaming crowded markets before the Festive Season. However, despite the current situation, the Domestic Apparel Industry has gradually begun to recover from its disastrous first quarter of FY 2020-21 in the midst of another sharp rise in Covid-19 cases across the country.
“The week leading up to the festival finally saw some movement in the business. Wholesalers and retailers have been stocking up so as to ensure that shoppers have a wide range to choose from. However, given the current situation, credit is the only thing keeping the industry afloat. While it will take another four to five months for any measure of normalcy to set in, the wheels of the sector have slowly begun moving again,” shared Hemant Gosalia, a trader for more than 17 years now.
A BLEAK PICTURE
A walk around most marketplaces shows a very grim on-ground situation with an ‘Available for Rent’ sign up on most storefronts. High rents and zero to low sales have made it difficult for standalone stores to survive. The lockdown has also led to an all-time high in ‘credit outstandings’ with banks across chains. Manufacturing units have also faced their own set of challenges such as the migration of labourers leading to an extreme fall in new lines of production. This season, summer collections were disposed off in September at huge discounts thus turning the market into a price turf war. However, the arrival of the festive season has led to a change in demand preference, thus creating a demand-supply mismatch.
Speaking to one of CMAI’s prominent members about this current situation, Mr Santosh Katariya, Peppermint Clothing, Pune, said, “The fashion industry is busy liquidating its stocks. We are trying to clear out our summer collections by giving discounts. It is important to know that business profitability will come up by 70 per cent considering that the past few months have seen no business throughout summer. However, I do not feel the industry will return to its original form before 2023.”
Another prominent member, Mr Naveen Sainani, Jt Honorary General Secretary, CMAI, and Chairman and CEO, Fritz Gaitri Clothing Co Pvt Ltd, Mumbai, said, “Big brands are most affected. Especially the ones that have to pay for rented spaces in malls, because they have remained relentless in procuring rent and leasing space. Therefore, local shops are seeing more footfalls because no one wants to pay such steep prices inside. While the footfall is not as much as last year – with a drop of almost 50 to 60 per cent, it is at least doing much better than the corporates who are facing major revenue falls.”
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