End-of-season sales shed discount-first playbook amid strong demand

Fresh merchandise drives demand as retailers pare markdowns and shorten sale periods

End-of-season sales (EOSS) are off to a strong start, with apparel retailers reporting higher demand for fresh merchandise even as they offer fewer discounts and run shorter sale periods. A higher number of wedding dates this year, along with tax relief measures that have lifted disposable incomes, is encouraging consumers to spend more on full-price products.

 

Retailers say they have put a smaller share of their inventory on discount this season as demand for fresh collections has remained healthy. Many are also introducing new merchandise earlier than usual, indicating confidence in consumer spending.

 

“This quarter, we have seen double-digit growth, and full-price items have gained major traction,” Devarajan Iyer, executive director and chief executive officer (CEO) of Lifestyle, told Business Standard.

 

Iyer credited the stronger demand to a busy wedding calendar and higher disposable incomes following the government’s tax measures. “The government has put more money in consumers’ hands through income-tax relief, and that is flowing through to retail spending,” he said.

 

Lifestyle, which typically discounts around 40 per cent of its inventory during EOSS, has reduced that to about 30 per cent this season because of stronger demand. Discounts remain in the 30-40 per cent range, but the sale period has been shortened to seven to eight weeks from around 10 weeks earlier, Iyer said.

 

The trend is playing out across other apparel retailers as well. Ethnic wear brand Biba Apparels said its like-for-like (LFL) sales are growing in the mid- to high-teens during the discount season, while demand for fresh collections has remained buoyant.

 

“Our LFL sales are trending in the mid to high teens this discount season, which is strong. We are also launching our fresh stock earlier than usual,” said Siddharth Bindra, managing director at Biba Apparels.

 

He added that the strong offtake of fresh merchandise has made the company optimistic about demand in the coming months.

 

Listed value fashion retailer V-Mart Retail also indicated healthy momentum. In its pre-quarterly business update, the company said revenue rose more than 23 per cent year-on-year to ₹1,089 crore in the April-June quarter (Q1), while same-store sales growth exceeded 9 per cent.

 

The pace of demand, however, has differed across categories. At Mohanlal Sons, known for men’s occasion wear, sales gathered speed only in June after a relatively weak May. “May was good for women’s ethnic wear, but June was better for menswear. The strong demand in June helped offset the slowdown we saw in May,” said Mayank Mohan, partner and CEO at Mohanlal Sons.

 

Mohan said the end-of-season sale has been largely flat for the retailer, adding that EOSS is not a major sales event for the company because demand is primarily driven by weddings and celebrations rather than discount-led purchases.