India’s leading retail chain firms are planning to cut discounts as demand and sales are back and growing since the last 2-3 quarters, The Economic Times has reported.
The CEO and retail director of one of the largest retailers in India, Aditya Birla Fashion, Vishak Kumar, told analysts that the company had brought the discounts back to the pre-Covid level, cutting the discount offer in the process. Demand fell in recent years, prompting the introduction of steep discounts to boost sales. However, now that the demand is back, retail chains plan to bring discounts down and do so incrementally, he said in the report.
Leading department store chain Lifestyle International Chief Executive Devarajan Iyer told ET that discounts have decreased across categories and are now almost comparable to the pre-pandemic levels. He added, “However, some brands, who have a high inventory level, still offer the high level of discounts.”
It is important to note that retailers across the board started offering steep discounts and also ran sudden flash sales in their stores to liquidate stocks during the Covid years of 2020 and 2021 till regarding mid-2022. The report stated that electronic suppliers did not face such a situation because demand was greater than supplies.
The revival of mobility since last year meant offices and educational institutions opened, which resulted in a growth in demand for apparel, fashion, footwear, and other lifestyle products. There was an additional demand as customers refreshed their clothing collections.
The report added that Woodland had reduced the number of discount days by two weeks compared to pre-Covid days. Also, the quantum of discount offered was lower, at an average of 20–30 per cent, compared to flat 40 per cent discounts earlier.
