October 2019

Heavy discounting, inventory push will lead to growth

By DEEPAK AGARWAL

Channel partners are more encouraging towards brands with lower online presence or those maintaining MOP (market operating price).

• India’s consumer durables sector is currently witnessing headwinds and is affected mainly because of heavy rainfall, economic slowdown, liquidity issues, intensive competition and an inventory push.
• Despite these factors, due to strong growth in air conditioners in the previous quarter, companies with highest sales in Q1 saw channel restocking at the start of Q2 as their inventory had depleted. Institutions (schools, offices, etc.) also contributed to this growth. Washing machines and refrigerators saw a fall in growth.
  • E-commerce players have offered huge festive-season discountsand offline trade has tried to match these rates to facilitate inventory liquidation, but this has impacted their m1argins. As a result, channel partners are more encouraging towards brands with lower online presence or those maintaining MOP (market operating price).