Business Line, November 3, 2019

India Inc, Centre must learn the right lesson from surge in festival spending

Diwali sales boost shows that in these difficult times, it is better to drop margins and push sales volumes up, rather than hold on to high margins and not sell at all
Indians splurged ₹19,000 crore in just six days at Amazon’s ‘Great Indian Festival’ and Flipkart’s ‘Big Billion Day’ sales. The combined gross merchandise value of the e-commerce majors from this season’s festive sale was 30 per cent higher than 2018 and 77 per cent more than the year before. Elsewhere, India’s largest carmaker Maruti Suzuki posted its first increase in sales after seven months. It sold 48,000 cars on Dhanteras day alone. The white goods and home appliances sector too registered a 25 per cent increase in volumes. What do these numbers indicate? Some would like to use these facts to deny the obvious slowdown. But the real message for manufacturers, retailers and the government is that consumers are willing to spend if they see real value. In other words, if the price is right. When consumer confidence is low, as the RBI’s bi-monthly Consumer Confidence Surveys reveal, people tend to hold back their spending. They did just that, and saved up over the last few months. But when brands enticed them with good discounts, they dropped their reticence and took the bait. There is a signal lesson here for manufacturers, who have been looking to the government to bail them out with tax sops — in these difficult times, it is better to drop margins and push sales volumes up, rather than hold on to high margins and not sell at all. Some manufacturers appear to have understood this, and have extended their ongoing discounts till the end of the year. This could bode well for the economy. 

Comments

Post a Comment

Popular posts from this blog

ED tracks Swiss Bank A/Cs of Agusta scamster

The Poineer February 10,2019 Rakesh K Singh The Enforcement Directorate (ED) has tracked a dozen Swiss bank accounts in the name of Rajiv Saxena, who is key accused in the Rs 3,600 crore AgustaWestland VVIP chopper scam. The ED has also found out accounts held by  his family members and associates where the kickbacks in the now scrapped deal were allegedly parked. Two bank accounts are in the name of Rajiv Saxena’s  associates Pankaj Jain and Sumita Jain who are also the authorised signatories. The  third is in the name of another associate Ajit Singh Bubber, but Rajiv and his family members are authorised signatories. The remaining nine accounts are largely owned and operated by Rajiv, his family members and associates. Rajiv Saxena was deported by the UAE authorities on January 30 and the ED formally arrested him the next day and a court later granted his remand to the agency. He is currently undergoing custodial interrogation by the ED. The agency had in 2017 arrested his
Read more

J&K Cricket Board Scam: Chargesheet Filed Against Farooq Abdullah, 3 Others By CBI

OUTLOOK July 16, 2018 The agency has levelled charges of criminal conspiracy and criminal breach of trust under the Ranbir Penal Code against Abdullah and three others. The CBI on Monday filed a chargesheet against former Jammu and Kashmir chief minister Farooq Abdullah and three others in a special court in Srinagar in connection with alleged irregularities and misappropriation of funds in the Jammu and Kashmir Cricket Association. After the fall of the Peoples Democratic Party (PDP) and the BJP government, this is the biggest development that has taken place in the state. The National Conference has not reacted to the chargesheet so far. The agency has levelled charges of criminal conspiracy and criminal breach of trust under the Ranbir Penal Code against Abdullah, the then president of JKCA, Md Saleem Khan - the then general secretary, Ahsan Ahmad Mirza - the then treasuer and Bashir Ahmad Misgar, an executive in the J&K Bank. The BCCI gave Rs 112 crore t
Read more

Election Commission proposes 10% hike in poll campaign expenditure cap

 The Indian Express' Dated: September 10, 2020 BY:  RITIKA CHOPRA The Law Ministry, sources said, received a proposal from the EC last week on amending Rule 90 of the Conduct of Election Rules 1961 to raise the expenditure cap ahead of the Assembly elections in Bihar. The Election Commission (EC) has proposed a 10 per cent increase in the campaign expenditure limit for all future elections given the constraints posed by the  Covid-19   pandemic ,  The Indian Express  has learnt. The Law Ministry, sources said, received a proposal from the EC last week on amending Rule 90 of the Conduct of Election Rules 1961 to raise the expenditure cap ahead of the Assembly elections in Bihar. The current ceiling for state polls in Bihar is Rs 28 lakh. This will increase to Rs 30.8 lakh once the Law Ministry accepts the proposal and notifies the change. The last hike in the expenditure ceiling was effected before the 2014 Lok Sabha elections. According to government sources, the EC has argued that
Read more