VISAKHAPATNAM: The otherwise bustling garment showrooms wear a deserted look as the number of footfalls has reduced considerably over the past one month following demonetisation.
While most retailers look forward to December and January months to push their sales, this year they find it tough to figure out ways to overcome setbacks and deal with cash-strapped customers in particular.
Mall owners say that the sales volume has been impacted because of the liquidity crunch. “Normally, we expect the sales volume to pick up during Christmas season and continue to scale up till Sankranti. However, this year there is already a 40 to 50 per cent drop in the business. This is basically because the purchasing power of people has drastically come down post demonetisation,” says Mavuri Venkata Ramana, chairman and managing director of CMR Group.
Mr. Ramana says there is no solution in sight as the cash flow in the market has substantially come down. He makes it clear that he is not venturing into any new endeavour to boost sales due to unfavourable market condition.
Further, offline retailers feel that the enormous discounts and value-added services offered by e-commerce firms contribute to the slump in sales at standalone stores and shopping malls. “Currently, people restrict themselves from compulsive shopping as the focus is more on procuring essential commodities. Though online players impacted the business of readymade garments to a significant extent, the handloom segment has remained untouched despite the e-commerce boom,” shares Kankatala Mallik, CMD of Kankatala Group.
With a number of garment stores bearing the brunt of cash crunch, retailers expect the business would take a new turn in the coming days. “Even sourcing stocks from Kolkata, Delhi, and Mumbai has been affected for the past one month. We only hope that things would improve by March,” says V. Deependra Varma of Aarika outlet.
