India's retail segment, which had suffered immensely due to the lockdown and the ongoing pandemic, is on the verge of a comeback with sales at 93 per cent of pre-Covid levels. As per a Retail Business Survey by the Retailers Association of India (RAI), the level of degrowth in retail sales has reduced as most segments have started to show significant improvement. As per the survey, sales in February 2021 were at (-)7 per cent compared to last year’s sales on a year-on-year (y-o-y) basis and at (-)18 per cent in the third quarter of the current financial year.
The survey says that the consumer durables and Quick Service Restaurants (QSR) categories have shown positive growth of 15 per cent and 18 per cent y-o-y respectively in February. Categories such as footwear, beauty, wellness and personal care, sports goods and food and grocery have shown month-on-month recovery on a y-o-y comparison, signaling growth from March 2021.
It has been found that there has been recovery across regions and the eastern region in particular showing positive growth of 2 per cent during February. It was also found that southern and northern India have also recovered better with sales nearing pre-Covid-19 levels at (-)6 per cent and (-)9 per cent respectively, while western India has progressed slower at (-)16 per cent.
The survey has indicated that retailers are hopeful of achieving pre-pandemic levels of business in the first six months of the year 2021. The study found that although Covid-19 vaccinations have started, the pandemic situation may take some more time to completely settle. RAI believes that recovery will need unconventional solutions and government support. At this juncture, all efforts are required to boost the local economy and help revive retail, saving millions of jobs. RAI has appealed to the ministry of health and welfare to prioritise Covid-19 vaccination for front line retail workers.
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“We hope that the uncertainty regarding the rising cases of Covid-19 in a few states will not cast its shadow on the growth momentum with the roll out of the vaccine. Restrictions or not, it has now become imperative for every retailer to adopt phygital in various ways be it social media, messaging platforms, or digital shopping in addition to their normal channels to align themselves with the changing consumer mindsets of the next normal,” said Kumar Rajagopalan, CEO, Retailers Association of India (RAI).
Experts feel that the revival of the retail segment is also due to an increase in pent up demand for white goods and apparels getting released now. Brands are competing hard to win a larger share of the consumer’s wallets by increasing the sales support and merchandising staff at the points of sale.
“Many households have preferred to buy consumer electronics such as larger refrigerators, vacuum cleaners, dishwashers, washing machines, etc to be self-sufficient. Many homes have also invested in better laptops, mobiles, televisions, ergonomic furniture to cater to the new lifestyle of work from home (WFH), online education and entertainment. Health foods and beverage brands are investing in sales people at retail counters. As online shopping has increased, we see a rise in demand of people in the supply chain operations. At the same time, there has been a hiring pick-up in retail business for all these brands that have gone up November onwards. Current hiring levels are about 80 per cent of pre-Covid-19 levels,” Aditya Narayan Mishra director and CEO of CIEL HR Services, told THE WEEK.