Indian retailers hit by localized lockdowns

The second wave of Covid-19 in India is now taking a toll on retail sales as states impose curbs on the movement of people and business activities to control the spread of the virus.

According to a Retailers Association of India survey, retail sales in May were barely one-fifth of pre-Covid levels. The sales figure slid 79% from the same month in 2019.

Retailers across the country reported falls in sales with the steepest decline averaging 83% in the Western and Northern regions. The Eastern region reported a 75% fall, while the Southern region was comparatively less affected (73%) during the period. On a sequential basis, the decline in May was much steeper than the previous month, when overall sales across India were down 49% compared to April 2019, the survey added.

As localized lockdowns had led to the closure of shops in many cities and many industries had adopted remote working, customers had cut down on discretionary and impulsive purchases. In terms of retail categories, beauty, wellness and personal care saw the steepest decline (87%), followed by footwear (86%) and sports goods (80%) last month as against May 2019. However, food and grocery witnessed a comparatively lesser decline of 34% compared with May 2019, while the quick service restaurants witnessed a dip of 70%.

The association claimed that retail businesses continue to face financial pressures on various fronts such as salaries, rentals, electricity charges and various taxes and license fees, among others, due to the pandemic-induced restrictions. However, the group is optimistic about June as many states are now easing the lockdown norms in a calibrated manner.