The Economic Times
English EditionEnglish Editionहिन्दी
| E-Paper
Search
+

    Huge demand for electronic goods, smartphones lights up festive sales

    Synopsis

    Electronics retailers said the actual sales could have been much better for categories like televisions, kitchen appliances and laptops, where the shortage was felt the most. However, consumers have uptraded with average billing value rising 15-20% over last year, led by larger contributions of premium products.

    Average selling prices have risen across categories — 34% for laptops, 13% for televisions and 8% for refrigerators — helped by EMI offers and cashback schemes for payment on credit cards and finance
    Kolkata | New Delhi: Sales of smartphones, televisions, refrigerators and washing machines rose 8-10% in the Dhanteras-Diwali period over the year earlier, even though several retailers said the number of units sold have either remained flat or only grown marginally due to an acute shortage of products. The flat volume was offset by higher ticket value — with more premium products sold, average billing value rose. This was aided by EMI offers and finance schemes and consumers spending more even on cash purchases, since there are few other avenues to splurge on, companies said. Some retailers expect the surge to last through the weekend.

    In categories such as apparel and lifestyle, the sequential improvement and recovery was better than the initial estimates of retailers. Departmental chain Lifestyle and Arvind Fashions, which sells brands like Gap, Arrow, Calvin Klein and US Polo Association, said they achieved almost 80-85% of last year’s levels.

    Electronics retailers said the actual sales could have been much better for categories like televisions, kitchen appliances and laptops, where the shortage was felt the most. However, consumers have uptraded with average billing value rising 15-20% over last year, led by larger contributions of premium products.

    Tata-owned electronics and smartphone retailer Croma’s marketing head Ritesh Ghosal said the chain has grown business by 21% over last year. “This in spite of severe shortages in several categories. Actual growth in television, home and kitchen appliances could have been much more if supplies were not a challenge,” he said.

    Untitled-12Agencies

    ‘Stocks Sold Out’
    In the past week to Dhanteras, sales have grown 50%, aided by a rise in smaller cities and towns over the year earlier, said Vijay Babu, vice president, LG India, India’s largest appliance maker.

    “On Dhanteras, there has been heavy customer rush and, in fact, several stores in several smaller cities where Covid infection rate is low, had no place to stand. Whatever stocks are there in retail are getting completely sold out,” he said.

    There was a shortage of entry level products such as 32-inch televisions, kitchen appliances and microwave ovens, said Nilesh Gupta, director at Vijay Sales, a leading electronics retailer in Mumbai and Delhi. “The share of premium products has gone up this Diwali like double-door refrigerators and large screen TVs.”

    In smartphones, retail chains said business is up 8-10% and even volumes have risen 3-5% over last year though the biggest surprise has been the increase in sales of premium models from Apple, Samsung and OnePlus.

    “We have seen even a 10-year-old buying a smartphone due to online classes while the entry age used to be 18 years earlier,” said Chandu Reddy, director at Sangeetha Mobiles, south India’s largest cellphone retail chain with over 650 stores. “Also, the average selling price which had dipped till now has surged in the last one week due to high sales of premium phones like the iPhone.”

    Average selling prices have risen across categories — 34% for laptops, 13% for televisions and 8% for refrigerators — helped by EMI offers and cashback schemes for payment on credit cards and finance, said Shankar BK, CEO of Vivek, a leading electronics chain in the south.

    Apparel Sales Improve
    Festive shopping has helped business bounce back with recovery at 75-80% of last year's Diwali, said Rishi Vasudev, CEO of Lifestyle and home improvement chain Home Centre. “We are expecting sales to be good this weekend too due to last-minute Diwali shopping,” he said.

    For Arvind Fashions, sales are at 85% of the year earlier, higher than its earlier estimate of 75%. “Last few days have been quite good and better than expectations,” said managing director J Suresh. “We were worried about the surge in Covid cases in Delhi, but business hasn’t dropped.”

    Anant Daga, MD of TCNS Clothing, which owns W for Woman and Aurelia brands, said there has been a pronounced spike in business in the last two weeks. “Smaller cities are doing well and some of them have already reached pre-Covid levels,” he said.

    Shrians Jewels, which operates an outlet in Delhi’s upscale Defence Colony, said the company was expecting only about 25% of the business it did in the last Dhanteras but managed to achieve 60-65%. “The response has been better than expected,” said Priyank Gupta, head of business development. “There is pent-up demand.”

    The festive season sales – which starts with Navratri-Dussehra and ends with Dhanteras-Diwali – is crucial for consumer-facing companies. In categories such as electronics, smartphones and apparel, the month-long period accounts for 35-40% of annual revenue.

    This year, sales during Navratri and Dussehra were buoyant, led by ecommerce marketplaces such as Amazon and Walmart-owned Flipkart, which did record business. While product shortages were felt then too, companies had managed to beef up last-minute supplies for Dhanteras and Diwali.
    (Catch all the Business News, Breaking News Events and Latest News Updates on The Economic Times.)

    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    1 Comment on this Story

    chayan roy110 days ago
    Wish we will buy "Made in India" only on this Happy Diwali to make it happy to our Countrymen.
    The Economic Times