Erratic consumer behaviour makes retailers cautious

Indian organised retail is constantly in a state of dilemma, with consumers changing their buying behaviour like a chameleon. From apparel, accessories, electronics to consumer durables, retailers across categories are unable to gauge

consumer behaviour and have taken a cautious approach when it comes to stocking fresh inventories.

After the economic slowdown of 2009, retailers are trying their best to woo customers back to malls, stores and shopping centres. Unlike in the past, even consumers are sticking to seasonal discounts and bargains to make their yearly and other purchases leaving fresh stocks untouched. So players are further forced to offer schemes on new merchandise to keep the cash registers ringing. Customers habituated to buying during the sale period keep themselves away even from window shopping when fresh stocks arrive.

Consumers change their buying behaviour like chameleons

Industry witnessed hightened activity during the end of season sales but the festive shopping that starts before Onam and generally boosts the morale of the retail industry received lukewarm response. Sales were the dullest in over 20 years. Now apparel players like Indus League, Louis Philippe and others are stocking their shelves cautiously to avoid inventory pile up.

Retailers are also adopting various gimmicks to boost sales. Louis Philippe, for instance, kept fresh stocks in the first two weeks of August while its end-of-season sale was on so that the fresh merchandise also got attention. And some retailers linked the inventory management at the shop floor to employee incentive program. Though some players like Madura Garments and Arvind Brands feel that stocking less merchandise can be a disadvantage since the consumer may walk into rival brands’ store for shopping. However, keeping the mood of the consumer and economy in mind, the industry is willing to take the risk.