After a slowdown in Q3 post-demonetization business, Clothing Manufacturers Association of India’s (CMAl’s) Apparel index for January-March 2016-17 reveals that the Indian apparel industry is slowly and surely making a recovery. The Q4 Index shows overall growth has improved mildly with overall lndex Value moving up to 2.25, compared to 1.4 points in Q3.
Similar to last quarter, giant and large brands recorded 10.58 and 6.72 points Index Value.
The Index shows that overall Index Value was most impacted by sales turnover than any other factor. Giant brands managed a good 10.58 points with fast clearance of goods that increased sales turnover to 8.00 points. Comparatively, large brands sales turnover grew 5.78 points. Small and mid-brands sales turnover also increased at 0.31 and 1.60 points respectively.
“Giant and large brands seem to have connected with organised retail through MBOs, EBOs and large format stores and managed their business and sales turnover well. They may have taken the discounting route thereby stimulating sales to clear off inventory at store and company level. This is clearly reflected in increased sales turnover with not much increase in inventory holding,” CMAI Said.
Big brands have well understood the strong correlation between sales turnover and inventory holding, while small and mid brands are more dependent on trade and with less control on retail, they are not in a position to push up sales. As Sanjay K Jain, managing director, T T Ltd said, “Both are interlinked. We managed the same way partly with our aggressive push in the last three months and because of yarn price rise.”
Vinod Kumar Gupta, managing director, Dollar Industries said “Increase in sales turnover roots in a decrease in inventory holding, as this is our, on the go season and there was huge demand. Due to this, our stocks sold out quickly. That’s how sales turnover increased and inventory holding reduced this season.”
– Apparel and Textile News, Apparel Talk, Indian Apparel
