Leading brickand-mortar retailers are seeing double-digit surge in their same-store sales this Diwali season despite top online rivals’ big discount sales last month, signalling a sharp reversal from last year’s trend.
Top retailers such as Future Group, Arvind Brands, Shoppers Stop, Vijay Sales, Puma and Max report buoyant demand over the past two weeks. Future Group founder and CEO Kishore Biyani said the country’s largest retailer is set to grow its business 25-30 per cent this Diwali over last as sentiments look positive. “Ecommerce is still a minuscule of the entire market, except a few categories like mobile phones, so there is not any impact on business,” he said.
Some other retailers attributed the rise in demand to fresh merchandise, fewer discounted merchandise of big brands on online portals, and early onset of winter chill in some parts of the country.
“It (online) had a novelty factor that helped last time,” J Suresh, chief executive at Arvind Lifestyle Brands said. It sells brands such as Gap, US Polo, Wrangler and Calvin Klein. “With fewer discounts by ecommerce and new season merchandise offered by physical retailers, we are seeing same-store sales growth of 8-15 per cent,” he said. A year ago, ecommerce giants Flipkart, Amazon and Snapdeal had pursued an aggressive discounting policy during the festive season to gain market share and traffic. This impacted demand in physical stores, even prompting traditional retailers to approach the government over what they said was predatory pricing.