No end to retailers' travails even with end of season sales
Retailers are concerned over the tepid response to end of season sales (EOSS) and are offering discounts of up to 75% amid worries they will need to extend the period as business is yet to reach last year's levels. The next few weeks will be crucial as retailers look to clear out inventory before new-season stock is due to come in. According to ICICI Securities, higher discounts are reflective of the relative stress in underlying inventory.
The company analysed Shoppers Stop, Reliance Trends, Lifestyle, Pantaloons, VMART, Max and Westside and found that due to a revenue decline of 5-15% YoY in the April-May period most brands have kicked off EOSS two weeks early, it said in a report released on Sunday. Retailers traditionally launch EOSS by June end, before fresh season merchandise hits their shelves. However, brands started the sale mid-June and it's likely to continue till mid-July.
As business slowed February onward, brands had been expecting revenue to reach 2022 levels during EOSS, retailers said. Some started the sale early to improve revenue. «Last year there was a strong momentum leading to EOSS but this year momentum was being built from the second half of May due to the wedding season,» said Satyen Momaya, CEO of French apparel brand Celio.
«But sales haven't reached the last-year level. During EOSS, it should come to last-year level as we are expecting up to 40% increase.» Revenue performance in the March quarter had already been weak for most apparel retailers. «The growth has been slow in comparison to last year but the next two-three weeks are crucial,» said Lifestyle CEO Devarajan Iyer.
Read more on economictimes.indiatimes.com
