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Despite early monsoon and heavy rains, apparel retailers are bullish about the end-of-season clearance sale that witnesses buyers bagging huge discounts on summer inventory. The industry expects a healthy 25-30 per cent growth this year and hope to clear out summer inventory in the months of July and August.
Twice a year, small and major apparel brands and retailers offer discounts on inventories of previous seasons - in July-August for summer inventory and February-March for autumn/winter inventory. The sale for summer inventory usually start anywhere between early and mid-July.
Last year, due to excise duty levy pushing up apparel prices coupled with inflation, the clearance sale was a dampener for many. However, this year, despite monsoon hitting early and heavy rains, footfalls are less likely to take a hit, say brands and retailers.
"Response has been pretty good this year. While we are offering the usual range of 30-50 per cent discount, the footfalls have been growing despite monsoon. We had good summer season and the trend is continuing in the clearance sale as well. As against last year when things were sluggish, this year sales are up by almost 30 per cent for us," said Ashish Barodia, business head for Trigger brand of jeans by KG Denim.
According to the Clothing Manufacturers Association of India (CMAI), the trend is likely to continue for the next season of festivals since the impact of excise duty would also wear out.
"Last year the levy of excise duty had hit us badly in apparel sales. This year the effect is wearing out. Plus, consumers can't stay without buying apparel for more than a certain period of time. Hence, the upswing is back during the end-of-season sales. Brands and retailers like Shoppers Stop, Lifestyle, Westside and others are gradually beginning to open the sale. As an industry, we expect to see a healthy growth of over 25 per cent as against last year," said Rahul Mehta, president of CMAI.
Even regular value-for-money retailers like Promart have also seen growth during the clearance sale. "We have various schemes wherein on certain days the whole store is flat 50-60 per cent off. Sales have been better this year and consumer's mood is changing. Add to that, the growth for us is also because of the number of stores that have increased from 25 last year to 81 this year," said Punit Agarwal, chief executive officer of Promart.
