Diwali spark fails to light up markets as traders strive to break even

For the past three days, Raunak Gulati, who owns an electronics store in Lajpat Nagar, one of the busiest markets in South Delhi, has been wondering if he would be able to at least break even on the investments he made on bulk buying electronic items and lighting to sell during Diwali.

While the market is busy as ever, no one seems to be buying much. “I spent over Rs 2.5 million in buying goods to sell this Diwali. I was hoping to earn almost double in sales. But at the rate I am going I would be lucky if I do not incur losses,” he said. 

In Gujarat’s Surat, Anand Bhai Shah, a textile merchant, is still awaiting cheques from five of his customers amounting to more than Rs 7.5 million. “They claim they have not been able to sell the stocks and are asking for more time for payments. I can still wait till the end of Diwali but smaller traders are finding it tough. The overall market sentiments after demonetisation has not been able to change ever since. For the past three years, it has been fluctuating and it has not been able to reach the high it would do pre-note ban,” he said. 

Gulati is not the only one. Markets across the country have seen a decline in footfalls, other the bare essentials required during Diwali people seem to be avoiding markets, be it high street shopping complexes, malls or local bazaars.  

From firecracker sale ban, negative consumer sentiments, less liquidity in the market to the online sale festival blitzkrieg right before the offline festive sales, traders are blaming all these for the dip in bricks and mortar shopping across the country. 

The Confederation of All India Traders (CAIT) on Sunday declared that there was no shopping fever in the markets this year around and situation seems to be worse from last year. Pinning hopes on Dhanteras, traders believe that if there is any scope for a last-minute turnaround it would happen on Monday.  

Spending capacity of customers, they claim, has gone down drastically. “The traders are hoping that from tomorrow, the day of Dhanteras festival shopping will take a speed and in remaining days of festival, the consumers will come to the markets. In comparison to last year there is a 40 per cent decline in business,” said Praveen Khandelwal, secretary general, CAIT. 

         

 Many claim footfalls in markets this time around would not be any parameter for gauging sales, as while people are stepping out, not many are buying. “Whatever bare minimum is needed for rituals during Diwali are the only items being bought. No one is buying clothes, electronics, or other non-essential items that are otherwise a hit during Diwali,” said Ashok Randhawa, president, Sarojini Nagar Mini Market Association. 

Online sale madness  

While country’s two online marketplace giants — Amazon India and Flipkart — did not give any actual sale numbers, the way the described, while ridiculous, gives an idea on how much they sold certain items.  

Picture this. Amazon claimed that after its ‘first wave’ of sale, it sold more Lego bricks than the height of Dubai’s Burj Khalifa and more Diwali lights than what would be required to light up Mount Everest. Flipkart, too, claimed that if all the washing machines it sold were stacked together, its height would be 15 times more than that of Everest.  

With most of the shopping at least in the top 150 cities already done at never-heard discounts, traders claim no one now wants to step into the shops to buy more. “They are having their sales in waves, which is ruining any appetite for shopping left in customers. Online companies are selling products at predatory prices, which are affecting offline business,” said Khandelwal. 

Hopes on last-minute shopping spree 

Some are still hoping for a turnaround. Industry body ASSOCHAM said sentiments would pick up in the next three days on the back of last-minute shoppers. “They would be growth of linked industries such as electronics, household gift items, FMCG. Moreover, this year Diwali is falling in the first week of the month so people will have more disposable income after getting annual bonus and salary payments,” the spokesperson said.