Indeed the vaccine will give a boost to malls and retail stores and they can expect business to pick up once people are less apprehensive about crowded places. However, one big take away from the lockdown was the popularity of online shopping and not just in metros but also in smaller cities and towns, even rural India. While buyers may like to visit stores for big-ticket purchases and special items like for a wedding or special occasion regular buys like groceries even apparels could see more traction online. Thanks to apps and home delivery.

Super apps the way forward

Growing popularity of online business has also pushed manufacturers to focus on this channel as they can no longer afford to ignore this aspect of business. However, what they need to focus on is whether it is enough to have own websites or whether they need to be a part of a large marketplace like an Amazon or a Flipkart. Experts believe buyers will soon get used to a handful of apps, and these will take care of almost 70-80 per cent of their requirements. And customers will most likely depend more on them.

As per a Financial Express report, there is already a lot of buzz around Super Apps—which offer a wide range of products. But the moot point is how many Super Apps can Indian market accommodate? As of now the populuar ones are competing against each other like Amazon, Flipkart, Paytm and Jio. And all of them are looking at teaming up with brands to boost their range of merchandise. The report also suggests the B2B space over the next couple of years could well eclipse B2C space as marketplaces scout for good brands to team up with and help them generate demand.

Business integration key

And as the big few compete with each other a lot is changing in terms of business. For example, in October, Walmart, which owns Flipkart and the fashion portal Myntra, picked up a 7.8 per cent stake in the Aditya Birla Fashion Retail (ABFR). The partnership is expected to boost ABFR e-commerce sales. Besides the existing B2B arrangements with Flipkart, ABFR has an agreement for the sale and distribution of its brands through Flipkart’s marketplaces. ABFR could also potentially use Flipkart’s supply chain to reduce time-to-customer and obtain consumer data from Flipkart and Myntra to analyse trends and efficiency. In July 2020, Flipkart had acquired a minority stake in Arvind Youth Brands and is most likely on the lookout.

However, as per the report, manufacturers across the board from apparels to cosmetics need to rope in more than one of these big players to sell their products online and unless the product or service is unique and exclusive with a strong brand pull, it could get lost and be easily ignored by consumers.

Meanwhile new partnerships are shaping up Tatas for example, are creating a digital platform. Indeed, manufacturers have understood the importance of online channels and how critical it is to make sure their products are available on the online platform with a customer base. It is no longer about discounts, but about the availability of the merchandise.

However, the fact is there is a big margin between the number of online shoppers and Internet users in India. Little wonder then Kotak Institutional Equities has pegged India’s total e-tail GMV at $270 billion for FY30 and $800 billion for FY40, up from the current $120 billion. Business can only get better from here on.

Though reopening of the economy may bring shoppers back to stores, they will not completely abandon online shopping, says a Financial Express report. India’s e-retailing business is expected to grow more robustly in 2021 even though competition from brick and mortar stores may increase customer acquisition costs. Indian e-commerce space is becoming more competitive with players like the Tata Group entering the market, says Harsha Razdan, Partner and Head-Consumer Markets and Internet, KPMG India. Along with B2C, the B2B e-commerce segment will see a lot of action next year as retailers will transform mom-and–pop stores into larger marketplaces. Unorganized and larger players will explore kirana stores to expand their presence. For instance, five-year old retailer Jumbotail will help 30,000 kiranas digitize their stores. The company will convert these stores into modern convenience grocery outlets while JioMart will help fulfill orders placed by kiranas by sourcing products from their distribution centres and network of stores. As per Ankur Pahwa, E-commerce sector leader, EY, many of these marketplaces will also try to help generate demand for their B2B customers.

Next year to be a year of partnerships

Anurag Mathur, Partner & Leader- Consumer Goods and Retail, PwC, believes, 2021 will be a year of partnerships. Mathur says brands and marketplaces will soon be joined by other smaller FMCG companies to determine the price of some categories like electronics. Razdan says, though consumers might download a number of shopping apps in the coming year, they will use just a few of these. They will mainly be attracted mainly by a brand’s strength and its consumer friendliness. Most brands therefore, would have to partner with other apps or platforms.

Partnerships between offline and online retailers will continue to expand in 2021, says Pahwa. According to him, having realized their interdependence, both physical stores and online marketplaces will explore each other’s strengths to create a strong brand presence.

Online retailers to expand product offerings

On their part, online retailers will try to attract consumers by on-boarding more SMEs. They will strive to diversity their product offerings to suit local tastes, says Mathur. This would help them to retain consumers, he adds. However, as they expand their supplier base, they would also have to maintain quality standards and keep their customers informed about their new offerings. Smaller suppliers, not used to making deliveries within specified time periods, would have to abide by their commitments. These suppliers would have to be monitored by bigger marketplaces to ensure timely deliveries to customers, adds Mathur.

While the pandemic resulted in business upheaval across the textiles and apparels value chain in 2020, the industry is still confident about achieving much needed growth in 2021. As Indian Texpreneurs Federation (ITF) convenor Prabhu Dhamodharan points out, the sector can make 2021 a year of progress by focusing on the US market as industry had benefited from the volumes in the market in the first 10 months of 2020, "Now, its time to step up the efforts to repeat the same success in the US market for our apparel products,” he says.

Optimistic about sector growth

The Coimbatore-based ITF, which represents the entire value chain of the textile sector, has suggested a six-pronged strategy to achieve double digit growth in the textile and apparel sector, under the theme ‘2021-A year of progress for Indian Textile & Apparel Sector’. “As a sector, we are doing $35-37 billion exports (average of last few years) of all products put together. If all goes right, we can reach double-digit growth. We can make 2021 a year of progress for the Indian textiles and apparels sector,” Dhamodharan opines.

ITF’s six point strategy for growth ahead starts with a stronger focus on the US market for apparels. The Indian home textile sector was the biggest gainer in volume terms in the US market in the first 10 months of this year. Going ahead efforts should be made to repeat the success for Indian apparel. Vietnam’s FTA with the EU will intensify competition for India in that region. At the same time, a level playing field with our top three competitors in the US market in terms of duty, combined with a quick economic recovery and consumption in the US, makes a compelling case for the Indian apparel sector to focus on the US market for immediate growth.“We need to intensify efforts and focus at all levels, including the government, cluster and firm level, to grab our share in the US market in apparels,” he says.

Focus on value addition

The second point is to focus on value addition with new capex. Using the low interest regime and easy liquidity, combined with robust demand visibilities due to post-Covid opportunities, it is time for the textile & apparel sector to step up efforts in terms of new capex investment at various stages of the value chain, with a single focus on value addition with the goal of a 20 per cent increase in per product revenue.

The third point is to use the forthcoming PLI scheme as the stepping stone for much-needed product diversification and innovation in the MMF (man-made fibre) space, and build scale to attract global buyers. Stating that all manufacturing units need to invest in technology adoption and digital initiatives, he said to equip the industry and eco system, culture-building of having an agile mindset is the forward to institutionalise the success.

The industry is currently managing trade well with sufficient liquidity due to infusion of funds in the system with Central governments Emergency Credit Line Guaranteed Scheme. The sector needs to utilise the opportunity to maintain the financial discipline to work on shorter credit terms across the value chain to improve the business performance and sustain the recovery momentum, he said.

The North American lifestyle and performance Footwear Company, Skechers opened its largest Indian store in Thane.

The new outlet has an open-air design with no closed spaces that offers a hygienic and safer shopping ambience to the shoppers and an amazing retail experience.

The company pulled off the brave decision of opening a grand store in such uncertain times and is a great evidence of the brand’s strong customer base and store design which is appropriate in these times.

Skechers is an American performance and lifestyle footwear company which provides a range of top-notch products for men, women and children. It was founded in the year 1992 by Robert Greenberg who sensed that there was a high demand for stylish casual street shoes among the young and fashionable.

Headquartered in Manhattan Beach, California, the company now provides thousands of styles designed and developed by its in-house team. The brand entered India in 2012 with an aim to expand its business.

Footwear and apparel brand Woodland’s business in India has recovered to 60 per cent of pre-COVID levels, says a report by the Hindu Business Line. During the initial days of the pandemic, the brand reworked its website to make it more user-friendly and allow more payment options. It altered its product portfolio across e-commerce sites — such as Amazon, Myntra and Flipkart — to include ‘lower cost offerings’ that were in demand then.

The brand initially focused on items like open footwear including flip-flops and sandals, monochrome tees and athleisure were the focus initially. It introduced canvas shoes and walking shoes as jogs, walks and runs became popular. The brand witnessed a renewed demand for T-shirts and casual wear during the festive season. However, its premium leather offerings (formal footwear) under the ‘Woods’ and ‘Woodland’ brands remain slow. Major outdoor apparel sales, including cargoes and other functional wear, are yet to pick up.

Omni-channel sales helped the brand in better inventory management and clearing excess stocks from slow-moving stores. It recorded strong demand for casual shirts and T-shirts from parts of South India and the company used stocks from North and West India stores to cater to the demand. It hopes to end the current year with 60-70 per cent of last year’s turnover.

The uncertainty around rental negotiations in FY22 continues, brands and retailers feel the support on rentals should continue as long as it is required, as they fear extension of Covid-induced SOPs, social distancing norms, and overall reduction in physical interactions. Meanwhile, consumption across India has barely touched about 50 per cent on an average, buying has slowed down after pent up demand and festival season was over.

As per a December report by BCG on how India shops, spends and saves in the new reality, “In apparel, purchase decision was primarily triggered by social/celebratory occasions (accounting for 42 per cent triggers). However, the single largest trigger now is functional — clothes for home workouts, an additional pair of jeans due to daily washing, worn-out innerwear replacement, etc.”

Discussions on for rentals in FY 22

“We are already having discussions now to plan for the next financial year. Going ahead, we don’t rule out a rental correction — about 15-20 per cent lower than what it was pre-Covid, as the situation in metros is definitely quite bad as compared to small towns when it comes to mood and sentiment,” said Siddharth Bindra, MD, Biba to Financial Express.

Olive group of restaurants founder AD Singh, too, expressed similar concerns. He feels the way forward on rentals would depend on prevalence of virus and people’s comfort about stepping out “which is quite unpredictable”. Support on rentals should be given as long as it is required.

Mall operators awaiting government action plan

Mall operators too are waiting for more clarity as footfalls would now be determined only after government rolls out the immunization program. On rental front, mall owners who had extended slab-wise discounts till March, say rents are already down by as much as 25 per cent in some places. Omaxe president (retail), Benu Sehgal points out Covid-19 has had a painful impact on all rental properties and in some cases, rental income dropped almost 25 per cent.

While some retailers have shut stores, others operated with renegotiated rentals. Increased consumer spending witnessed in last few months coupled with news of vaccine, may spur up demand in coming quarters of next year. With new collections, expectations of shoppers returning to malls has gone up, all this has reignited hopes of a bounce back in rentals, which may be a concern with brands and retailers and engage in negotiations with mall owners already stressed with existing discounts in rentals.

India’s leading power dressing brand from Aditya Birla Fashion and Retail, Van Heusen has launched an exclusive campaign for its Winter Collection 2020. ‘The Winter Edit’ campaign showcases the brand’s right blend of fashion and comfort in their latest winter wear collection. The campaign depicts various moods of winter through different looks and seamlessly amalgamates colour play, style and fashion in the collection. With this, Van Heusen calls out to own this winter in style with its latest collection of the season. The latest collection features a stylish range of sweaters, jackets, sweatshirts, and cardigans, which are available at nearest Van Heusen stores across the country. The collection is also available across e-commerce platforms.

Van Heusen has curated the collection for every winter mood of young modern Indian audiences, who are inclined towards fashion that comes with functionality and comfort. Signifying their belief of extending trendiest yet most functional looks of the season, the brand has brought a wide range of bold, stylish, comfortable, and playful winter wear to its customers. Van Heusen has released the campaign on YouTube, which will be further amplified on other digital platforms including Facebook, Instagram, Inshorts and in store.

Van Heusen is India's No. 1 premium lifestyle brand for professionals. With a rich heritage of 128 years in United States of America, the brand entered India in 1990. Over a period of its 25 years of history in India, Van Heusen has emerged as a fashion authority for the ever-evolving Indian consumer and has established itself as the one stop destination for the latest trends.

Home furnishings retailer IKEA India, which recently opened its store in Navi Mumbai, plans to expand its store network by opening two smaller format stores in Mumbai and focusing on the Delhi, NCR and Bengaluru markets. IKEA has purchased a 14-acre land parcel in Bengaluru to construct its third store in the city. It also has a land parcel in Gurgaon.

IKEA also plans to expand its online operations in India. It has earmarked about Rs 6,000 crore investments in Maharashtra in the next ten years. IKEA India first opened its online channel in Mumbai before opening its store in the country's financial capital. Since the home furnishings retailer entered India, it has brought in investment close to Rs 10,500 crore. A part of Ingka Group, IKEA India opened its first retail store in Hyderabad in August 2018, followed by online stores in Mumbai, Hyderabad and Pune.

With the pandemic reducing sales to just 20 per cent month-on-month on their mono-brand sites, fashion and lifestyle companies are launching customer acquisition strategies like upgrading and digitally promoting their websites, negotiating better deals with logistics partners, creating warehouses and using their store network as hyperlocal delivery points, says an Economic Times report.

Brands are also investing in customer acquisitions. Vibhor Sahare, CEO. ANS Commerce says, businesses at mono-sites had grown by two-five times in the pandemic. Prior to the pandemic, volumes on mono-brand webstores were low, which made the companies unable to negotiate better rates from logistical partners, thus impacting their unit economics for online deliveries. Now, the unexpected increase in sales during the pandemic has helped them negotiate better rates from logistics partners.

Several brands have introduced their own apps or are planning to do so soon. Levi’s and Benetton are planning to launch their India brand apps early 2021. Their assortment offer will be exclusive and the largest on their own site and they will launch energy collaborations like Levi’s xBape or Levi’s x Snoopy first on their own site, says Sanjeev Mohanty, CEO-South Asia, Middle East and North Africa, Levi Strauss

Retailers Association of India (RAI) has urged the government to extend support to help revive retail as retailers across fashion, electronics and grocery segments hope to achieve about 85 per cent of pre-pandemic level business in the next six months. As per latest business survey by RAI, retailers across India have been registering steady month-on-month recovery driven by festive sales in November 2020 falling just 13 per cent short of last year’s sales.

In November, consumer durables and electronics category recorded 12 per cent year-on-year sales followed by the food and grocery category which recorded 5 per cent sales growth. Apparel and clothing segment is still under pressure with about -12 per cent year-on-year sales growth compared to pre-pandemic the survey added. As per RAI, with local level restrictions imposed in several states in fear of a second wave of COVID-19 cases, retailers are approaching 2021 with cautious optimism. While western and eastern regions are indicating slower recovery with sales at -18 per cent and -17 per cent respectively, northern and southern regions are progressing at -9 per cent, on a year-on-year comparison.

According to RAI, sized around $854 billion, the retail industry is one of the country’s largest industries and makes up for over 10 per cent of its gross domestic product (GDP). The industry employs 46 million people, of which 90 per cent are in blue collar segment. Fashion and electronics contribute 50 per cent to the total retail while food and other essentials account for the rest.

It’s raining discounts with both online and offline retailers rolling out steep offers for shoppers. Brands are offering attractive prices on products which is helping them attract customers from Tier II and III cities. Online fashion retailer Myntra is ready to host its biggest-ever winter sale from December 20. In fact, the retailer expects a 1.5 times more response to this sale than its last winter edition, when 50 per cent of business had come from Tier II and III cities. Held twice a year, the June edition of the End of Reason Sale received a lukewarm response as the country was just coming out of a lockdown. However, the retailer expects 65 per cent jump in traffic for the December edition.

Winter to aid apparel recovery

Though COVID-19 related restrictions have affected apparel demand in the country, branded apparels are seeing a gradual recovery with offline sales recovering up to 70 per cent of pre-COVID levels. Recovery is being further aided by a strong winter season, says a ICICI Securities report. This year, brands don’t plan to promote their winter inventory extensively as demand is quite strong. Department store chain Lifestyle, which started offline sales, does not plan to promote its winter merchandize extensively as it believes demand is strong. However, the retailer plans to push unsold inventory from Spring/Summer season, informs Rishi Vasudev, Chief Executive Officer, Lifestyle and Home Centre.

Strategies to attract customers

Yogeshwar Sharma, Executive Director and CEO, Select Citywalk Mall explains, brands have their own strategies to attract customers. Most of them hold EOSS post-Christmas. However, some have already started running offers in malls. These brands are attracting customers with promotions and other attractions such as personal shopper, digital catalog, etc.

Outdoor and apparel brand Woodland is ready to hold its End of Season Sale in the second week of December. And like earlier, this year too, the brand plans to offer lucrative discounts on apparels and accessories, says Harkirat Singh, Managing Director. It has already achieved 70-80 per cent of last year's business levels.