Retailers are offering lowest discounts this festive season: Here's why

Low discount offers with few promotions expected to continue in festive season

Online brands and stores focused on top lifestyle and consumer electronics are offering some of the lowest discounts in the ongoing sale season. The end-of-season sale which has attracted deep disocunts over the years witnessed a sharp drop for the need of big discounts as products are low on stock with demand outstripping supplies across the apparel and electronics sector.

As the smartphone and electronics retailers get their sheen back, especially in the Rs 15,000 sub-category, with demands reviving faster than supplies, the trend is expected to continue in the festive season as well, according to an Economic Times report. Due to Covid-19 induced lockdowns, apparel retailers have limited stocks both in stores and online platforms, with production getting disrupted since March.

"In this situation, people won't step out and shop even if there is a discount. The industry is seeing one of the lowest discounting periods at stores as well as online," said J Suresh, the chief executive at Arvind Fashions that sells brands such as Calvin Klein, Gap and US Polo Assn to the newspaper. "Festive season will have a few promotional offers, but not reduced price-tags," he said.

The paper reported that retailers have reached only 30-40% of their pre-pandemic levels in sales as buyers are wary of spending and are buying only whats needed. The report further said that footfalls in stores are picking up and retailers expect demand during festive season but they are also cautious of crowds in their stores due to Covid-19 risk. 

Moreover, the store owners have limited old stock due to prodution delays which meant the store owners and online platforms did not have to go through discounting cycle extending the life of the stock.