22 August 2022, Mumbai:
Slowdown & Fashion
In light of reports from every sector of the global manufacturing and retail industries, foolish people in business blame the global economic recession for weak demand from advanced economies and the second-largest consumer base in the world.
The first quarter of FY 2019 saw an approximate 17% fall in Indian clothing/apparel exports.
Slowdown in economy
The Clothing Manufacturer's Association of India statistics shows that in April and May 2018, garment exports totaled US$1.35 billion and US$1.34 billion, respectively, down 23% and 17% from the previous year. The overall value of apparel/garment exports fell by 4% to US $ 16.72 billion that year.
Slowdown in Indian economy
The Goods and Services Tax (GST), which went into effect in 2017, is one of the unpopular policies that has shaken the foundation of Indian businesses. Working capital was blocked due to a rushed implementation since state levies and other refundable taxes took longer to be refunded. Along with the negative repercussions of GST, the economy has also suffered from the shockingly unexpected demonetization, which has had effects far beyond waiting in line to exchange cash.
Slowdown in Indian economy temporary or structural
One of the worst-hit sectors globally is fashion retail, with even the most well-known companies closing hundreds of stores, particularly in the US. In India, however, the rate of retail credit dropped to 16.9% in May 2019 from 18.6% in May 2018, showing a slowdown in the economy. The data from the RBI reinforces the concern about a downturn, but the Central Bank of India has some encouraging words to say about the situation. According to the Reserve Bank of India, the slowdown the economy is experiencing is cyclical rather than profound or structural.
A general slowdown in the economy
Nevertheless, land, labor, and marketing problems must be resolved. A significant slump will be felt in manufacturing, trade, hotels, transportation, communication, broadcasting, construction, and agriculture.
Deepak Bansal, the director of Cantabil, concurs that slowdowns are unavoidable but only last a short while, asserting that "slowdown is a cyclical occurrence." No lull lasts forever. After the subprime mortgage crisis in the USA in 2008, the global economy slowed down. In India, it slowed down again in 2012–2013 due to policy indecision on the government's side. However, the economy quickly recovered following that.
The most important lesson from previous recessionary periods is to "keep your fundamentals sound" and "avoid yourself from any knee-jerk reaction." Therefore, apparel/clothing companies with solid fundamentals may experience short-term sales pressure, but no crisis-type situation will result.
Cautious Optimism
The effect of the generally negative attitudes is felt across industries, and consumer buying has undoubtedly been cautious, according to Ramesh Kaushik, Vice President of Brand Experience at Blackberry. Despite this, compared to last year, our business has remained consistent.
The holiday season was pretty beneficial for us. We are honored to have a loyal customer base who chooses our brand over others because of its fit, quality, and innovation.
Kaushik continues, "At Blackberrys, we build upon both online and offline initiatives to promote user happiness and brand preference. This may have helped during these trying times. Spending on customer-facing areas across products and services is our plan.
We have taken advantage of the growth potential in the menswear market thanks to our correct understanding of customer choice, our ideal reach-out media approach, and omnichannel retailing supported by some of the benchmark practices.
The fact that Puma has become the largest sportswear brand in India suggests that it has discovered the ideal balance between offline and online shopping. Puma is not deterred by the economic recession and will continue to run its 360 stores in the country, while other rivals like Nike are planning to close as many as 150 stores to restructure. In Bengaluru, it recently opened its first experience store.
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