Organised retail business in the city, home to several swank as well as ordinary shopping malls and complexes, appears to be going through a lean patch of late, thanks to several factors that impacted the business.
After the city witnessed a boom in the software sector , multinationals made huge investments in setting up malls. Reputed national and international brands like Metro Cash and Carry (MCC), Brand Factory, Big Bazaar and domestic majors like the GVK ventured into the retail business setting up hyper malls.
The initial euphoria faded as some segments of retail business registered a steep decline in business in tune with the drop in the levels of disposable incomes of people. While global downturn saw a fall in the money pumped by the NRIs, periodic hikes in the interest rates made consumers to use their credit cards more judiciously.
The ongoing Telangana agitation had little effect on the businesses as the Mall managers claim “agitators are consumers too”. Apparel, garments and mobile phones continue to be hot favourites as consumers throng the Malls for their choice of goods, but the same is not the case with other segments.
“The feel good factor which brought in business a couple of years ago has disappeared and we are able to notice that,” said P. Raghuram of GVK One in Banjara Hills. Although the per capita spending on shopping has come down, the malls are able to shore up their bottomlines by attracting customers to other facilities like multiplexes, restaurants and bars. “Big banner movies continue to bring in viewers, but we are in no way close to the bullish trends experienced a few years ago,” he said.
Vishal Sehgal of the MCC observed that “business could have been much better” but for the slowdown and the absence of the feel good factor. The MCC, which basically is a business-to-business venture, did not feel an immediate impact as retailers continue to make their purchases from its large facilities at Kukatpally and LB Nagar. “We may experience the impact after some time lag,” he said.
Traders are being trained to meet requirements of the changing economic scenario and the MCC itself was hopeful that the offerings being made to hotels and other establishments would help in containing the decline.
Apparel trade appears to be an exemption from the decline as Brand Factory, the retail outlet offering leading brands under one roof, registered a healthy growth of over 20 per cent since the last one year. Though the outlet had not felt the impact of the ongoing uncertainty, Brand Factory marketing head Jitendranath Patri feels that consumers are into “wait and watch game” for securing best value for their money.