Steadview Capital invests Rs 67 crore more in Nykaa


The capital infusion comes at a time when risk capital investment activity has almost ground to a halt because of the spread of the Covid-19 pandemic, which, in turn, has forced vertical ecommerce companies such as Nykaa to conserve cash, given the steep plunge in discretionary spending by consumers.

Asia-focused hedge fund Steadview Capital has invested an additional ?67 crore in online beauty retailer Nykaa, as the Ravi Mehta-led investment firm continues its deal-making spree this year.

The latest capital infusion follows the Rs 100 crore Steadview Capital invested in the Mumbai-headquartered company in April. That had valued the company at about $1.2 billion, in the process catapulting it into the unicorn club, or those startups that command a valuation of at least $1 billion.

According to documents filed by the eight-year-old company, accessed by business intelligence platform Tofler, FSN E-commerce Pvt Ltd, the parent entity which owns and operates Nykaa, has allotted an additional 1,09,986 equity shares at Rs 6,049.56 per share to Steadview Capital Mauritius. Steadview Capital has now invested close to Rs 170 crore in the company and holds a 3% stake in the venture.

Since January, the firm, which first came into prominence in 2014 after it invested in India’s largest online retailer Flipkart, has backed wealth management platform INDWealth, logistics Software as a Service company Logi-Next, ed-tech venture Unacademy and fintech company BharatPe, through a mix of primary and secondary deals.

Steadview Capital invests Rs 67 crore more in Nykaa
The capital infusion comes at a time when risk capital investment activity has almost ground to a halt because of the spread of the Covid-19 pandemic, which, in turn, has forced vertical ecommerce companies such as Nykaa to conserve cash, given the steep plunge in discretionary spending by consumers.

The latest investment comes almost a year after the company, which was founded by former merchant banker Falguni Nayar, closed a Rs 100 crore Series-E financing round led by TPG Growth, the mid-market investment arm of PE firm TPG Capital, valuing it at about $730 million at the time.

Karnataka government conditionally permits garment units to operate in red zones


The government had recently allowed certain industrial activities other than in the containment zones to operate, while relaxing the COVID-19 induced lockdown in the state.

The Karnataka government has allowed garment units in red zone districts, but outside containment zones, to resume operations with one third of the workforce. Chief Secretary T M Vijay Bhaskar in the May 8 order, said all recognised garment factories having an Importer- Exporter Code (IEC) and those registered with the Apparel Export Promotion Council (AEPC) can start operations with one third of the total workforce in red zone districts, but outside containment zones.

It said the permission is subject to following of the Standard Operating Procedures.

Currently Bengaluru urban, Bengaluru rural and Mysuru are the red zone districts in the state.

The government had recently allowed certain industrial activities other than in the containment zones to operate, while relaxing the COVID-19 induced lockdown in the state.

During the earlier phases of lockdown, only those garments involved in the manufacture of Personal Protective Equipment (PPE) kits for front line COVID warriors were allowed to operate.

Assam hikes liquor prices by 25 per cent


Assam cabinet held its meeting on Friday through video conferencing. Assam Industries and Commerce Minister Chandra Mohan Patowary said the 25 per cent hike will add Rs 1000 crore to the government's kitty.


 Assam increase excise duty on Indian Made foreign Liquor (IMFL) by 25 percent. The state government affected changes in labours laws allowing working shift to be increased from eight hours to 12 hours and allowing teas estates and manufacturing units to operate with full workers strength.

Assam cabinet held its meeting on Friday through video conferencing. Assam Industries and Commerce Minister Chandra Mohan Patowary said, Increase in MRP by 25 percent will give government Rs 1000 Crore.”

Tea industries and manufacturing industries which operating with 50 percent workers is allowed to operate with full capacity including personnel.

The cabinet has initiated labour reforms which included fixed term employment besides increase of minimum numbers of workers for implementation of Factories act from 10 to 20 (with power) and 20 to 40 (without power).

Cabinet has allowed increase in minimum number of workers for implementation of contract Labour Act from 20 to 50. The cabinet has passed Assam Agricultural produce and livestock marketing (promotion and facilitation) ordinance 2020 and repealed Assam Agricultural produce marketing Act 1972.

North eastern states Assam, Nagaland, Meghalaya and Arunachal Pradesh were planning to increase tax on liquor.

Assam finance minister, Himanta Biswa Sarma on Thursday said, “We had informal discussion with these states and we may increase the tax on the liquor.

Wine shops in Assam started operation on Saturday last.These shops were closed since March 24 due to 21 day nationwide lockdown due to COVID-19 pandemic. Last month after three days of operation wine shops were closed down following fresh notification from the Centre regarding second phase of the lockdown.

Lenskart projects 20% revenue growth in FY 2020-21


However, the revenue projection for 2020-21 are a significant drop for the company, which has historically recorded 40%-50% growth year-on-year till fiscal 2019.

SoftBank-backed Lenskart Eyewear Solutions has projected a 20% growth in sales in the current financial year, at a time when the ongoing Covid-19 pandemic has brought consumer businesses in India to their knees.

However, the revenue projection for 2020-21 are a significant drop for the company, which has historically recorded 40%-50% growth year-on-year till fiscal 2019. It is yet to file its financials for fiscal 2020.

“At a time like this, we are still hoping to record a 20% growth in business for financial year 2020-21… It is obviously not as much as we have usually recorded in the past, and is certainly not going to be in the 40%-50% revenue growth range that we anticipated earlier, prior to the pandemic,” Peyush Bansal, chief executive of Lenskart, told ET.

Lenskart’s sales are being driven primarily through the company’s website and mobile app. The split between online and offline sales are currently in a ratio of 90:10, according to Bansal, whereas pre-Covid-19, it was typically recording a ratio of 70:30 in favour of sales through its 600-plus stores.

The Faridabad-based eyewear solutions company, which had to shutter its retail outlets across the country, as the nation went into a lockdown to combat the pandemic, has reopened about 100 stores over the last one week, which are located in green zone designated areas, and expects prescription glasses and contact lenses to drive revenue for the ongoing fiscal.

“There is a demand for quality affordable eyewear, and we are the only ones that can provide it to you online, at home, as well as in the store, while ensuring all safety precautions are in place, and at scale,” Bansal said.

The company, which sold about 6 million pairs by the end of March 2020, is anticipating sales of about 7 million pairs by the end of the current fiscal, with demand picking up third-quarter onwards.

According to Bansal, the company is also projecting opening an additional 200 stores through the course of the current financial year.

“We want to add at least another 200 stores this year. The model will change. Instead of a fixed rental, we are looking to enter into a revenue-share with potential landlords…We are working on the locations for new store openings right now. They will be spread across a combination of tier-1 and tier-2 cities,” Bansal said.

The opening of new stores comes at a time when global ratings agencies have continued to slash economic growth projections, for Asia’s third-largest economy, citing the shocks to the system triggered by the Covid-19 pandemic.

Last month, Fitch Ratings hacked India's GDP growth to 0.8% in the current fiscal, stating an unparalleled global recession was underway due to disruptions caused by the outbreak of covid-19 pandemic and resultant lockdowns, adding that the slump in growth was mainly due to a projected fall in consumer spending to just 0.3% in FY21.

“We, fortunately, are in a business which is a necessity… Retail will, and is, going through a tough time, but it also depends on the category in which you’re operating… While consumption has taken a hit, people continue to need affordable eyewear. We have a speciality there, and we need to serve this demand,” Bansal said.

The offline stores are primarily serving as eye test centres for customers

“Almost 60% of the country’s population needs vision correction. People need their glasses. That problem is not going away. The stores are not just points of sale for us. While the Covid-19 may linger for some more time, there is a time after that as well,” Bansal said.

The CEO also said that there are no plans to raise further capital from investors, as the company is “well capitalised” and continues to keep its burn rate under control.

“We have also been fortunate, because we had raised financing right before the outbreak of the pandemic. Otherwise, the situation could have quite different. This definitely allows us to cruise.” Bansal said.

In 2019, Lenskart had raised an estimated $330 million in quick succession from SoftBank’s Vision Fund-II and home-grown private equity major Kedaara Capital, in a mix of primary and secondary transactions, and which catapulted it into the unicorn club.

Distributors: Chips, biscuits stocks low


The All India Consumer Products Distributor Federation (AICPDF) said most companies are unable to service the order generated by the distributors and if the situation continues, then panic buying would begin again, like when the lockdown was first imposed in March.

Distributors of FMCG products say there could be a shortage of biscuits, noodles and chips in the next 10 days if companies are not able to ramp up production and if transportation remains constrained by the paucity of labour.

The All India Consumer Products Distributor Federation (AICPDF) said most companies are unable to service the order generated by the distributors and if the situation continues, then panic buying would begin again, like when the lockdown was first imposed in March.

“Companies usually have stock for 15-20 days in their facilities, while distributors for a month. Today, companies have stock for just 2-5 days and distributors have for a maximum of 4-5 days. If we ask for 100 boxes of a product, the company will send us 10-20,” said Dhairyashil Patil, national president of AICPDF.

The reason, Patil says, is because in the initial days of the lockdown, FMCG companies were stuck with stock which was difficult to transport to the stores because trucks were stuck at state borders and drivers left the vehicles stranded. “Now, those stocks have come to distributors and gone to the market, so the pipeline has become dry. Most companies are working with 33% labour and they are operating at not more than 50% capacity,” Patil added.

The situation is especially worrying for noodles, for which there is no stock even for a day. While premium cookies is available, regular biscuits are not. One reason for the shortage also is that consumers are stocking up more than during normal times.

ITC said it has seen a surge in demand for essential food items including Aashirvaad atta, spices, salt, Sunfeast biscuits and Yipee noodles. “Such food products have been flying off the shelves. Our teams are working tirelessly to ensure that our diverse range of products reach the markets, despite supply chain challenges,” said Hemant Malik, divisional CEO of foods.

There are still lot of issues around inter-state passes, which is increasing the time the products take to reach distributors.

“Demand for all sorts of food has more than doubled in the last few months because that is the only expense bucket for a family right now. On the other hand, companies have not been able to cope with this as no one is operating at full capacity,” said Krishnarao Buddha, senior category head of marketing at Parle Products.

Silver lining for jobseekers as edtech, pharma, e-commerce, logistics sectors to continue hiring


Recruitment experts at Manpower, KellyOCG, PeopleStrong, and Xpheno predict that even as many sectors see widespread layoffs, there will be a silver lining in sectors like edtech, ecommerce/internet, transport and logistics, as well as pharma that continue to hire.

As the Covid-19 lockdown lifts gradually and people begin their return to workplaces, there are some pockets of hope for jobseekers.

Recruitment experts at Manpower, KellyOCG, PeopleStrong, and Xpheno predict that even as many sectors see widespread layoffs, there will be a silver lining in sectors like edtech, ecommerce/internet, transport and logistics, as well as pharma that continue to hire.

All of these sectors will need to hire talent for various roles, said experts, and skills in machine learning, data, AI will command a premium.

Supply is predominantly lower than demand in the transport and logistics sector, said Alok Kumar, senior director - Manpower.

“Logistics platforms are already revamping their concepts to match the new market circumstances by enabling retailers to scale home delivery fast. E-commerce companies will need to hire for last-mile delivery executives and warehouse profiles,” Kumar told ET.

Edtech platforms and office automation companies are expected to ramp up hiring plans, said Kamal Karanth, co-founder at Xpheno, a specialist staffing company. “Other sectors that will need to hire talent include pharma, medical devices and healthcare companies, which have seen a boom during the lockdown and will require talent in sales and marketing, engineering, research, as well as testing and customer support.”

Given that the lockdown is rolled back some time by the end of May or June in a phased manner (in the metro locations particularly), the annual absorption of top tech talent is likely to be around 75,000 (best case scenario), says Karanth.

The IT industry should see about half of the top ten IT services companies requiring fresh, top-rated tech talent, almost a third of the remaining services pool, and almost 15 to 18% of the high tech product / internet or GICs going for it.

The pharma sector will have jobs up for grabs in testing, research and sales, said Devashish Sharma, founding member at human resources solutions firm PeopleStrong.The new role of crisis manager will be in demand across sectors, said Francis Padamadan, senior director - RPO, KellyOCG. “Companies will want professionals who can help mitigate risks and losses from such similar global crises in future, and help coordinate smooth business continuity planning.”

Companies that ET spoke to are ramping up their headcount.

Edtech startup Testbook, which helps students prepare for government jobs, said it is scaling up content and increasing the current team size by 25% over the next six months, said CEO Ashutosh Kumar.

Telemedicine startup ekincare - which services employees of 600-plus companies and their dependents - has witnessed a 221% rise in online doctor consultations since the emergence of the first Covid-19 cases in India, said Kiran Kalakuntala, its founder.

“Since we have doctors on our own payroll, we may need to ramp up our team of doctors over the coming months,” Kalakuntala said.

Logistics company Ecom Express will be hiring ground and frontline staff, and in other roles in data sciences, IT development, planning and engineering and strategy, said co-founder K Satyanarayana.

Reopening of stores symbolic; soon firms will find it difficult to meet fin obligations: Spykar


The company, which has reopened around 25 franchise owned and operated stores by the weekend following government relaxation of guidelines for the third phase of lockdown, said it has so decided not to reopen any company-owned and franchise-operated stores till May 17.

The reopening of stores are just symbolic as it would take time for business to normalise, and without government support many companies will find it difficult to meet financial obligations, according to Spykar Lifestyles. The company, which has reopened around 25 franchise owned and operated stores by the weekend following government relaxation of guidelines for the third phase of lockdown, said it has so decided not to reopen any company-owned and franchise-operated stores till May 17.

The youth fashion denim products retail chain also feels that despite the government directives to pay salaries to employees and not to lay off people, many companies may no longer be able follow it as they would soon run out of money.

"These are early days for business to look up. These are just symbolic that business has started. Something to be looking forward to in these times. Any sane and practical business person would know that it is going to take some time before business normalises to where it should be," Spykar Lifestyles CEO Sanjay Vakharia told .

He was responding to a query on the response from consumers on reopening of stores and the company's own expectations when business restarts.

"We are not in a hurry. Currently, whatever we are opening are none of company owned-franchise-operated (COFO) stores. We are only opening only stores which are owned and operated by franchisees because they are entrepreneurs in their own right and they have the visibility of what they are doing. The decision whether they should open or not open, we have left it to them.

"What we are doing over there is we are ensuring all the SOPs that the company has laid down are followed. We are ensuring that they follow these protocols so that the consumers are absolutely safe, so that the staff in the store is safe...Internally we have decided not to open any store which is a COFO store till the May 17 till we have an understanding of the situation," Vakharia said, elaborating on the company's strategy for restarting business.

Commenting on the hardships faced by retailers during the lockdown, Vakharia said, "50 days have passed and not a single rupee has been recovered from the entire country in that sense...Overall it is not a great time and the ability to kind of keep honouring obligations would be getting minimised by the day".

He said although the company has paid salaries for its employees for March and "hopefully for April as well I think the sense of insecurity is quite high in the entire chain".

Expressing disappointment with the government, Vakharia said, "In this period, I feel we are let down by the government. They failed to see the extent of damage this can bring on the table. At one point, which is nice that they are trying to ensure that people do not get laid off and they don't lose their salaries, but how long can business sustain and be able to pay the salaries of these people".

Stressing that when none of the stores are operating and rents are expected by malls, which in turn have to meet their obligations to banks, Vakharia said, "Banks have to get this directive from the government to ease this pressure and that directive is not coming from the government. Somewhere the government is not accepting or wanting to take an obligation or probably just leaving things..."

"I think it is too long and the sense of insecurity which is pervading through the entire workforce is going to be a lot more damaging than what the government is anticipating."

Vakharia said although the company may not lay off people and pay salary but the whole sense of security among employees of whether their salaries will come or not, whether they would be having jobs or not, is diminishing.

"That sense of security, which the government thought would be there because of the directive that the government had, is not something which can be there for too long because at some point of time companies may not have enough money to pay. That time is very close and it is not too far away," he cautioned.

There is little that companies could do "if you don't have money in the bank, not a single rupee, even the receivables for what you have sold earlier is not coming because those people are also not doing any transaction", he said.

Lockdown brings change in buying behaviour, more older people hop onto digital tech: Survey


The lockdown has changed buying behaviour of Indians - like purchasing vegetables without asking for price.

The coronavirus lockdown has brought a sea change in the buying behaviour of many Indians, such as purchasing vegetables and other consumables without asking for prices, far from the old habit of asking 'dhaniya' or 'mirchi' free from vendors, according to a survey by Enormous Brands. The web-based survey, conducted between March 30 and April 22, took feedback from 3,737 respondents in cities including Delhi-NCR, Mumbai, Bengaluru, Chennai, Pune and Ahmedabad.

It found that there has also been a sharp increase in adoption of digital technology by older people to join the e-commerce bandwagon for ordering items like milk, grocery and home essentials and paying through wallets and UPI.

The study also found that COVID-19 has helped in forming an opinion for pushing the 'Make in India' agenda, with 42 per cent believing that "there is an active and deliberate attempt by China to spread COVID across the world for economic gains" which has led to a strong anti-China sentiment.

"The stay-at-home mandate has changed the behavior and attitudes of many Indians. Indians who were born and brought up asking for 'dhaniya' or 'mirchi' free from the vegetable vendors are now buying vegetables and other consumables without asking the prices. Stay-at-home orders have thus caused visible major shifts in people's behavior," said the survey.

Around 42 per cent of respondents claimed they buy vegetables and other consumables without asking for prices, which is a drastic shift from a universal value-conscious, penny pinching Indian mentality, it added.

The Enormous Brands surevy also found that India's older population adopted digital technology faster during the lockdown, with as much as 47 per cent higher adoption among elders (55-65 years) of e-commerce for ordering milk, grocery and home essentials and paying through wallets/UPI.

"The banks have been promoting internet banking for over a decade, in just the last month the data suggest that first time users have increased by 28 per cent. The maximum shift of 33 per cent is among the (elderly) age group," it said.

With lockdown forcing people at home, one of the the obvious choices to spend time is television watching.

The study found that TV viewership grew from strength to strength during lockdown, shining over OTT platforms. It found that 43 per cent saw cable TV as the primary entertainment in the high-income households and 13 per cent across the sample size re-activated their DTH/cable subscription, it said.

"Interestingly, 'news' has emerged as the new GEC (general entertainment category). A staggering 64 per cent of TV viewing time across the TV viewing population is spent on the news channels, while 43 per cent believe that news reporting is unbiased and 27 per cent believe that there is a clear indication that few news channels are pro a particular political party," the survey said.

Commenting on the findings, Enormous Brands Managing Partner Ajay Verma said, "The young Indian population is behaving very differently from other parts of the globe. The study suggests a high level of optimism even in a situation that has brought the entire world in a lock-down and also showcased that households feel confident about the revival of the Indian economy."

This study was conducted to help brands understand how the current situation is moulding the habits, behaviour and attitudes of Indians, he added.

As per the survey, newspapers are poised for a strong return, with 74 per cent of the respondents saying they missed their daily newspaper. While 29 per cent have moved to reading newspapers online, only 4 per cent would unsubscribe from the hard copy.

"Looks like the newspaper is a habit like coffee that has grown on the Indian palette, making it difficult to part with," it said.

Restaurants ready to take back control, go digital to serve customers directly


Expressing the sentiments of the industry, the National Restaurant Association of India (NRAI) said the 'logout' movement cemented the belief that the industry needed to take back control.

The restaurant industry is coming together to develop and identify alternative digital platforms that will level the playing field between restaurants and food delivery platforms, industry body NRAI said.

Expressing the sentiments of the industry, the National Restaurant Association of India (NRAI) said the 'logout' movement cemented the belief that the industry needed to take back control.

"Aggregators have become digital landlords. While they came in to solve a genuine problem, their one-sided policies are destroying the business, especially small restaurants. The industry is working together to create an alternative technology solution to reorient and sustain their businesses in the post-COVID-19 world," NRAI Managing Committee Member Thomas Fenn said in a statement.

The focus for the NRAI is on easy reconciliation, transparent pricing, cheaper delivery and protection of customer data. The solution will be driven by customer loyalty, omni channel online sales, integrated payment gateways and digitised delivery logistics, he added.

Social media platforms like WhatsApp, Facebook and Instagram are also being explored to leverage to reach out to customers, Fenn said.

In similar vein, NRAI President Anurag Katriar said, "Members of NRAI collectively own and operate some of the most popular restaurants and bars across the country. We feel that we have an ability to create the most comprehensive and attractive loyalty programme with some of the best names in the business coming together on a single loyalty program across the nation".

NRAI reckons that there cannot be a better programme than this in the restaurant trade. Once again, this will be by the industry and for the industry, he added.

"We have tied up with one of the largest player in this sphere and have already drawn out our blueprint and work is going on at a good pace. We will be in a position to launch this in a few months," Katriar said.

The current efforts of NRAI are simply aimed at creating more viable alternatives for its members and not aimed at being rivals to other aggregators or their current programmes, he added.

People resorted to panic buying during announcement of lockdown or its extension


Fast moving consumer goods grew 79% during fourth week of March when the government first ordered a nationwide lockdown for 21 days.

Purchase of daily household essentials and groceries in cities rose significantly only during the weeks when lockdown was announced, indicating huge surge in panic buying as consumers feared restrictions could worsen.

Fast moving consumer goods grew 79% during fourth week of March when the government first ordered a nationwide lockdown for 21 days. While the following week saw a sharp decline at 47%, the market saw purchase soar again by 239% during third week of April, which coincided with the extension announcement, according to Kantar Worldpanel, a global consumer research firm owned by communications and advertising giant WPP.

"Nearly 50% of the month’s FMCG is bought in the first week of the month. We see intensifying growth culminating with a very steep growth towards weeks when the lockdown was announced," said K Ramakrishnan, South Asia MD at Kantar.




Workers refusing to rejoin factories post lockdown may face pay cuts, disciplinary action


Gujarat, Madhya Pradesh, Karnataka and Uttar Pradesh are considering strict enforcement.

Factories and other establishments in some states may be allowed to cut salaries and initiate disciplinary action against workers who don’t report back to work within a stipulated period once the Covid-19 lockdown is lifted.

Labour department officials in states such as Gujarat, Madhya Pradesh, Karnataka and Uttar Pradesh told ET that issuing such an advisory to factories in their states is being considered at the top levels to bring workers back. Gujarat, Madhya Pradesh and Uttar Pradesh have loosened labour laws that will allow companies to hire and fire workers more easily as part of measures to make conditions for companies easier in order to resume economic activity.

“While an internal discussion is being held on these lines, a final decision will be taken if the lockdown is not extended beyond May 17,” said a top official in Gujarat’s labour department.

A directive, if issued, would be under the Factories Act, which covers any unit that employs 10 or more workers and uses electricity for production or employs 20 or more people with or without electricity.

Any circular would apply to all workers in relevant units and include migrant workers who may have either gone back home or are preparing to leave due to uncertainty over jobs and wages.

Workers refusing to rejoin factories post lockdown may face pay cuts, disciplinary action
Not Enough Manpower in Industrial Hubs
The idea is to dissuade migrant workers from going back or to return as soon as possible if they’ve left.

At least a dozen employers’ associations met labour minister Santosh Kumar Gangwar on Friday and urged the Centre to issue such an advisory as it would compel workers to return.

There is recent precedent for such measures — Goa, Gujarat and other states had in April issued similar advisories to allow essential services during the lockdown to ensure unhindered supply of medicines, food, fruit, vegetables, milk, bread and other items.

Such a measure will put pressure on workers to rejoin or face the risk of losing their jobs while helping the government address the issue of labour shortage as it looks to get factories open and resume economic activity, according to the people cited earlier.

There is concern that unless strict orders are issued, workers may not come back to work even if the lockdown is lifted and production is allowed subject to precautions and social distancing rules.

Other states are monitoring the situation and waiting for clarity on the extent to which industries will be opened after May 17.

Millions of migrant workers have gone back to home states in the absence of work and wages, leaving industrial hubs without enough manpower to restart factories.

Samsonite closing more than 100 outlets


Business of luggage companies has been hit hard by the Covid-19 pandemic due to its severe impact on aviation, hospitality and retail sectors across the world due to lockdowns and restrictions.

Luggage giant Samsonite is closing about a quarter of its India stores or more than 100 outlets as the company is severely stung by the impact of the Covid-19 pandemic, multiple people aware of the development said.

There are about 475 franchisee-operated outlets of Samsonite, American Tourister and House of Samsonite in the country.

The 100-plus stores being shut are owned by its largest franchisee partner Bagzone Lifestyle, promoted by the family of Ramesh Tainwala, former global CEO of Samsonite, the sources said.

“They only plan to retain a handful of flagship stores in some malls and at some airport and the rest will be shut,” said a person with direct knowledge of the development.

Bagzone, which operates around 130 shops of Samsonite brands, declined to comment.

Samsonite India spokesperson did not respond to WhatsApp messages seeking comment.

Bagzone has informed various malls and landlords throughout the country about its closure of the stores, executives of two malls that received the notice told ET. The decision to close the stores would also result in hundreds jobs loses, they said.

Business of luggage companies has been hit hard by the Covid-19 pandemic due to its severe impact on aviation, hospitality and retail sectors across the world due to lockdowns and restrictions.

“Luggage industry is fully dependent of travellers and it is going to be a lean couple of years for the industry,” said the person quoted earlier. “So Samsonite is downsizing considerably.”

Tainwala had resigned as CEO of Samsonite two years ago amid allegations of poor corporate governance and accounting lapses, including oversight breaches at the luggage maker’s Indian arm.

Tainwala, who started as an entrepreneur in plastic processing, has worked with Samsonite in different roles for nearly 25 years, initially as a vendor and joint venture partner, and later as an employee.

Besides Samsonite brands, Bagzone also operates stores selling Lavie branded bags, shoes and accessories.

India has been observing lockdown since March 25 to stem the spread of the novel coronavirus. While the government allowed reopening of retail stores in most places, all shopping malls remain closed. In fact, malls in various cities were shut weeks before the national shutdown as part of state governments’ initiatives to check the pandemic, rendering their businesses to almost nil for many weeks now.

Coronavirus impact: Online demand for non-essential items low


Discretionary spending is almost non-existent as online consumers defer high-cost purchases in the wake of uncertainty caused by the spread of Covid-19, said the sources who fear the economic contagion will also spread to metropolitan areas that account for two-thirds of India’s online commerce.

India’s top online marketplaces including Amazon and Flipkart are finding few takers for non-essential products ranging from refrigerators to air conditioners and apparel, according to industry executives monitoring the partial resumption of ecommerce activity across non-metropolitan areas of the country in the past week.

Discretionary spending is almost non-existent as online consumers defer high-cost purchases in the wake of uncertainty caused by the spread of Covid-19, said the sources who fear the economic contagion will also spread to metropolitan areas that account for two-thirds of India’s online commerce.

“Our current estimates point at only 60-70% of demand recovering even after restrictions for ecommerce are eased across the nation,” said a senior executive at one of India’s leading ecommerce firms who did not want to be named. “It’s still early days and while things might change, we’re seeing that people are buying only when there is an absolute necessity.”

Online marketplaces are awaiting permission for sale of non-essential goods in key cities including Delhi, Mumbai and Bengaluru — that are classified as red zones. With the bulk of the job losses and salary cuts borne by people in the red zones, ecommerce companies expect demand to be severely muted in these areas too.

India’s ecommerce market grew by around 35% to $32 billion in 2019, according to Forrester Research. However, analysts have downgraded growth forecast for the industry to just 6% in 2020 due to the effect of the pandemic while estimating this figure could drop further.

Coronavirus impact: Online demand for non-essential items low
Gloomy Outlook

The gloomy outlook for the ecommerce industry is being partly borne out by the very low sales of goods such as air conditioners and refrigerators in tier 2 and 3 markets, this past week, despite it being summer when sales of such items spike. Industry executives ET spoke to said that while there is some pent-up demand for white goods, it’s extremely small.

“Demand is very low. We did see some demand for smartphones, laptops, ACs and washing machines, but only from people replacing faulty devices or from (first-time buyers),” said an executive at a top ecommerce firm.

Fashion, which is the second-largest sales driver for ecommerce marketplaces, is among the worst-hit categories as people are only buying basic apparel such as t-shirts, shorts and kurtis, with high-value garments like office wear and outdoor clothing barely moving off shelves.

‘NOT LARGE MARKETS’
Satish Meena, forecast analyst at Forrester Research, said while there has been low pickup in sale of ACs and other such items, “the markets where (ecommerce) sales are now open are typically not large markets for such goods anyway”.

A spokesperson for Amazon said that the company has seen demand for “smart devices, electronics, kitchen appliances, clothes, toys and games, and other work and study from home enablers,” in markets where business has been open for a week now.

Consumers from red zones are also searching online for such items, the person said.

Flipkart did not respond to ET's queries until the time of going to press.

Snapdeal, which is less reliant on smartphones and appliances to drive sales than its two larger rivals, said while sales have recovered somewhat, the contribution from tier 2 and 3 markets is yet to reach the levels prior to the lockdown.

A company spokesperson said demand for “daily-use products like mixer-grinders, pressure cookers, kitchen containers, fruit & vegetable washing bowls, water bottles and kitchen tools” had spiked over the last one week.

SALES OF GROCERIES STRONG
While the majority of ecommerce is seeing a downturn, sales of groceries continue to remain strong, analysts and executives confirmed. Moreover, a large portion of consumers who shopped on these online platforms during the lockdown say they did it for the convenience rather than price arbitrage or selection, which has typically been how ecommerce has grown.

A survey conducted by community platform LocalCircles showed that 52% consumers agreed that online grocery ordering services were useful during the lockdown. The survey, which got over 39,000 responses, showed that 32% of shoppers also placed one or more orders for groceries and other essential items a week during the last seven weeks of lockdown.

E-comm to gain as malls suffer: Report


Up to 35% consumers said they would increase spending through e-commerce, the highest compared to other retail formats.

About 54% of consumers are expected to cut spends in malls largely to avoid crowds while boosting spends on channels like e-commerce, said a report from Boston Consulting Group (BCG). Up to 35% consumers said they would increase spending through e-commerce, the highest compared to other retail formats.

This is an indication of e-commerce emerging as the preferred way of shopping for consumers in a post-Covid-19 world and retail outlets in shopping malls would be the worst hit in the near term. Tier-2 and -3 towns may still rely on traditional setups but e-commerce is seeing faster adoption, than anticipated, due to the coronavirus pandemic and lockdown. The BCG report noted 85% consumers are trying to avoid public spaces as much as possible.

This would increase e-commerce penetration in India which is around 5%, where Amazon and Walmart’s Flipkart are fighting a fierce battle. Relatively, the same is much higher in the US at 15% and China 28%, according to a Bank of America report.

“Due to the current situation, many people who were not shopping online at all, or were purchasing in a few segments like apparel, are almost being pushed to try it out now. In the past, the biggest barrier has been the first-time trial. Many of them are now getting over that with the first barrier being broken and that’s a big change. Therefore, this will provide a big acceleration to online shopping, combined with the fact — consumers will be hesitant to go out to malls for a while, after the lockdown is lifted,” said Kanika Sanghi, partner and associate director, BCG.

E-commerce orders gradually scaling back to pre-lockdown level: Industry executives


E-commerce companies have been permitted to sell all items in orange and green zones starting from May 4, 40 days after the nationwide lockdown was imposed on March 25.

Sales of non-essential items on e-commerce platforms in the first week of May were lower than last year on account of lockdown, but orders are scaling fast with people buying apparel, smartphones and grooming products among other items, according to industry executives. E-commerce companies have been permitted to sell all items in orange and green zones starting from May 4, 40 days after the nationwide lockdown was imposed on March 25.

In the first two phases of the lockdown, e-commerce companies like Flipkart, Amazon and Snapdeal were allowed to sell only essential items like grocery, medicines and healthcare products.

Depending on the number of cases of coronavirus infections, areas have been divided into red, orange and green zones.

However, in the red zones that include top e-commerce hubs like Delhi, Mumbai, Bengaluru, Pune and Hyderabad, e-commerce companies can still ship only essential items.

While people are going online to buy items like chargers, extension cords, notebooks and pens to facilitate work and study from home, they are also picking up grooming products like trimmers, games like chess, monopoly and carom, and books across genres, a senior industry executive said.

The person added that since delivery of non-essentials is still not allowed across the country, the volume is less compared to previous year. However, against March numbers (pre-lockdown), the growth is certainly healthy.

Another challenge facing the industry is the availability of limited manpower for warehouses and delivery.

"Our order volumes grew rapidly and swiftly reached 50 per cent of pre-lockdown volumes within five days of expanded operations. Compared year-on-year, the order volumes for the first 9 days of May 2020 was 52 per cent of volumes in the same period last year," a Snapdeal spokesperson said.

The spokesperson added that another clear indicator of demand was conversions (from visitors to buyers), which was more than double of pre-lockdown average and even though demand estimation is a complex process right now due to multiple variables, the intensity and speed of demand restoration exceeded expectations.

Home use category like utensils, mixers and grinders, mops and brooms, and mosquito nets featured high in both search and sales. Snapdeal gets more than 75 per cent of its business from non-metro cities.

The spokesperson said locations like Panipat, Ambala, Panchkula, Amritsar in north; Udaipur, Valsad, Jamnagar and Goa in west; Coimbatore, Visakhapatnam, Pondicherry, Thiruvananthapuram, Kozhikode and Tuticorin in south, Cuttack in India and Guwahati in North-East have emerged as current high demand zones.

An Amazon India spokesperson said sellers on its platform have received orders for smart devices, electronics, kitchen appliances, clothes, toys and games and other work and study from home items.

Paytm Mall Senior Vice President Srinivas Mothey said the company has seen demand for non-essentials steadily picking up in all the orange as well as green zones.

"There has been a surge in searches and the sale of mobiles, masks, trimmers, laptops as well as other consumer electronics. There has been a 1.5X increase in sales as compared to March," he said.

Northern region of the country, few cities of south and eastern region are doing extremely well for Paytm Mall and the company is increasing the number of sellers and suppliers to meet the demands, he added.

With little to cheer, companies cut festive spend


Production cuts will be most in premium product portfolio as companies expect consumers to curb discretionary spending as the impact of the Covid-19. Manufacturing orders fall by up to 40% year on year as they expect much of current stock to remain unsold till then, company executives said.

Companies across apparels, shoes, refrigerators, air-conditioners and smartphones are cutting manufacturing orders and sourcing of components for this year’s festive season by up to 40% year on year as they expect much of current stock to remain unsold till then, company executives said.

Production cuts will be most in premium product portfolio as companies expect consumers to curb discretionary spending as the impact of the Covid-19 pandemic and the extended nationwide lockdown to contain it has affected all segments of the economy including household incomes, they said.

Most companies start their festive sales planning now.

“We have lost three months of active trading due to the lockdown, considering June will also be partial sales, and hence (we are) cutting order book,” Arvind Fashions CEO J Suresh told ET. “We won’t be making any order for autumn while for winter season it will be 60% of the normal,” he said.

Puma India MD Abhishek Ganguly said the brand will shift some production and launches beyond the festive season.

SSIPL Group, a contract manufacturer for brands such as Puma, Asics, Lotto and Power, expects its orders to be cut or postponed by 30-40% as most retail businesses are likely to see that much drop in their revenue, its managing director Rishab Soni said.

Market tracker IDC India said it will further downgrade India’s smartphone sales forecast for this calendar from its earlier projection of 135 million against 150 million units sold in 2019. While brands expect festive season to be good, it won’t make up for the lost sales in previous quarters, IDC India research director Navkendar Singh said.

Smartphone makers Xiaomi and Realme said they will adjust their portfolio for the year, which industry executives said will affect production plans accordingly.

Xiaomi, the country’s largest smartphone brand, said Diwali will help the smartphone market resume normalcy. However, the expected increase in average selling price in the wake of a rise in GST rates and the rupee depreciation might not take place, it said.

Electronics brands, too, expect a slowdown in sales, especially in the case of premium appliances and televisions.

Carrier Midea India MD Krishan Sachdev said the company is not placing any fresh component orders for festive season since it has huge inventory with summer sales completely gone.

Liquor firms fear return of restrictions amid chaos at outlets


The Ministry of Home Affairs permitted sale of liquor in the third phase of Covid-19 lockdown starting Monday, with a caveat of ensuring a minimum six-feet of physical distancing at stores.

Alcohol firms such as Allied Blenders & Distillers, Amrut Distilleries, John Distilleries and brewers including Bira 91 fear the government could impose restrictions again on liquor retailing in the wake of overcrowding and flouting of social distancing norms on the first day of reopening of sale.

Stores selling alcoholic spirits across green, orange and non-containment zones opened Monday after 40 days of lockdown.

“Shoppers are creating serious social crowding issues and if it happens again the government may stop the sale of liquor completely,” said Deepak Roy, the executive vice chairman of Allied Blenders & Distillers that maker of Officers Choice whisky. He is also the chairman of the Confederation of Indian Alcoholic Beverage Companies.

The Ministry of Home Affairs permitted sale of liquor in the third phase of Covid-19 lockdown starting Monday, with a caveat of ensuring a minimum six-feet of physical distancing at stores.
Retailers that opened doors in Karnataka, Maharashtra, Delhi, West Bengal and Andhra Pradesh noted serpentine queues as tipplers planned stock piling after the long period of prohibition. Several stores across the country ran out of stock by 11 am, executives said. Separate queues were maintained for men and women at a few locations, apart from capping the limit of purchase for a consumer.

However, such measures did not help in containing panic buying, queuing and social distancing in many places.

“While the government may not freeze liquor sale, we fear they may impose restrictions on the timings going forward,” Amrut Distilleries managing director Rakshit Jagdale said.

Alcobev firms such as John Distilleries and Bira 91 hope crowding would ease in the days ahead, but said curtailing liquor sale was not the solution.
“There is a definite risk of the government withdrawing its decision, but in our view, that would not be prudent. More disruptions would simply mean that whenever we decide to open, a similar or even worse rush would be there at shops,” Bira 91 founder Ankur Jain said.

Extending operating hours temporarily and implementing an odd-even mechanism on the basis of Aadhar cards to reduce the number of shoppers on a given day were better options, Jain noted.

There are about 70,000 liquor outlets in the country. The government has said 319 districts are in the green zone, 284 in the orange zone and 130 in red. Interestingly, Kerala, which was rooting for liquor retail to reopen, opted to stay closed on the first day despite approval from the central home ministry.

John Distilleries chairman Paul John said: “Restriction will in turn enhance overcrowding at stores and lead to bootlegging and sale of spurious liquor which is far worse. States need revenue more than ever before.”

Alcohol firms are pushing the need for app-based home delivery with government intervention and checks in place, to avoid a repeat of the scenario in future.

Zomato targets push into alcohol deliveries


"We believe that a technology-enabled home delivery based solution can promote responsible consumption of alcohol," Mohit Gupta, Zomato's CEO for food delivery, wrote in a business proposal to ISWAI.

Indian food delivery company Zomato aims to branch out into delivering alcohol, according to a document seen by Reuters, as it seeks to cash in on high demand for booze during the country's coronavirus lockdown.

Zomato has already diversified into grocery deliveries as the restrictions on movement shuttered some restaurants and people hesitated to order outside food due to fears of catching the disease.

Alcohol stores, closed nationwide on March 25, were allowed to re-open this week, generating queues of hundreds of people outside some outlets in some cities and leading to baton charges by police to enforce social distancing protocols.

To deter the large crowds, New Delhi authorities introduced a "Special Corona Fee" of 70% on top of retail alcohol prices, while Mumbai shut its liquor stores within two days of reopening them.

There is currently no legal provision for home deliveries of alcohol in India, something that industry body International Spirits and Wines Association of India (ISWAI) is lobbying to change in conjunction with Zomato and others.

"We believe that a technology-enabled home delivery based solution can promote responsible consumption of alcohol," Mohit Gupta, Zomato's CEO for food delivery, wrote in a business proposal to ISWAI.

The legal age for drinking alcohol varies from state to state, ranging between 18 and 25 years.

Zomato would target "areas that are relatively less affected by COVID-19," Gupta wrote in the unpublished document, submitted to ISWAI in mid-April and seen by Reuters.

Zomato did not respond to a request for comment.

ISWAI's executive chairman Amrit Kiran Singh said states should allow alcohol deliveries to help boost state revenues hit by the lockdown.

"The challenge is to ensure revenue from alcohol continues to be available," he told Reuters. "...It is imperative they (states) reduce the load on the retail counter ... by encouraging home delivery."

India's alcohol drinks market was worth almost $27.2 billion in 2018, according to the most recent figures from London-based research group IWSR Drinks Market Analysis.

Backed by Ant Financial - an affiliate of China's Alibaba Group Holding - Zomato bought Uber's Indian food delivery business in January.

Its main local rival is Swiggy, which is backed by China's Tencent and which Singh said ISWAI had also contacted. Swiggy also declined to comment.

The curious phenomenon of revenge shopping in China after lockdown


Long queues, fuelled by revenge spending sprees, have been seen outside outlets of brands in Chinese cities.

The French brand Hermes’ Guangzhou flagship store in China reportedly did $2.7 million in sales on the day it reopened in April. This is the biggest single-day shopping at a luxury outlet in China.

As more people come out of quarantine, there could be a spree of “revenge spending” at least among those who can splurge but could not because of lockdown. Revenge spending refers to an overindulgence in retail therapy by consumers who have missed shopping at their favourite outlets due to the lockdown. Long queues, fuelled by revenge spending sprees, have been seen outside outlets of brands such as Apple, Nike, Gucci, Estée Lauder and Lancôme, among others, in Chinese cities.

Could we witness such behaviour in India? There is no way to know.

Nikhil Prasad Ojha, partner, Bain & Company, sees two distinct consumer trends playing out — consumption among low-income groups dropping after lockdown while high-income households remain unaffected. “There will be a flight to value — shifting to cheaper alternatives (among mass market consumers) and simultaneously an uptick in premium segments given the sustained ability of high income households to spend,” he adds.

Luxury might be a necessity for a few, but most shoppers will stick to what they need to buy and hold the urge to splurge for more predictable times.

Nitin Jain, MD of Alvarez & Marsal (India), says, “India and China consumers are not an apples-to-apples comparison. New purchases in India might get impacted.”

PwC’s partner & leader for retail & consumer Anurag Mathur sees a spree of “indulgence consumption” happening in India after the lockdown is lifted.

Malls providing rebate on rents to retailers


Following the Covid-19 outbreak in India and the closure of malls in March, shopping centres and their tenants have been fighting over whether rent should be paid during this period.

 If retailers were known for offering flat discounts and buy-now-pay-later options to customers, there’s been a role reversal during the coronavirus era, with malls now offering their tenants the same deals.

Brigade Malls in Bengaluru is extending a 50% rebate on rent to its tenants from mid-March until its two malls reopen. Phoenix High Street Mall in Mumbai is giving retailers the option of paying March-June rents together in July, according to two top retail executives.

Phoenix declined to comment. Ambience Mall in New Delhi and Gurgaon is dangling a one-month rent-free offer for those who pay rents up to May.

“All retailers who shall pay their monthly dues of rent and CAM (common area maintenance charges) during the month of March, April and May in time will be allowed one month rent free extended period on renewal or expiry of their respective leases,” Ambience mall said in an email to retailers, which ET reviewed.

Following the Covid-19 outbreak in India and the closure of malls in March, shopping centres and their tenants have been fighting over whether rent should be paid during this period.

While retailers say their sales have been zero since mid-March when various states first ordered closure of the shopping centres, the malls contend that they have bank loans that are linked to rents they get from their tenants.

So far, only a handful of malls including Lulu in Kochi, Vegas in Dwarka, New Delhi, and Brigade in Bengaluru have given concessions from discounts to full waivers for a month.

“Since it is a pain for both sides, we decided to share the burden 50-50,” said Shashie Kumar, COO of Brigade Malls. “About 40% retailers have already reverted to us and appreciated our move.”

ET reported earlier this month that about 200 retailers and restaurants including Future Group, Aditya Birla Fashion, Arvind Brands, Domino’s Pizza, Adidas and Levi’s have decided not to reopen their stores in malls that disregard their plea to move to a revenue-sharing arrangement for a few months after the shopping centres open.

Lockdown 3.0: More shops expected to re-open but confusion reigns, say retailers


In red zone all malls, market complexes and markets will remain closed in urban areas, which are within limits of municipal corporations and municipalities. However, shops selling essential goods in markets and market complexes are allowed.

Retailers and traders expect to re-open more shops from Monday under the new relaxed guidelines by the government for the extended lockdown period till May 17, although they are still seeking clarity from local authorities. Retailers Association of India (RAI) said it will have to be seen how it works out at the ground as there is confusion, and many states are yet to come up with guidelines to follow the Centre's decision. It has already stated that what constitutes market places could be misinterpreted.

Similarly, Confederation of All India Traders (CAIT) also claimed they will be in a "dilemma" as there is confusion over "what constitutes a neighbourhood shop and a standalone shop", while organised retailers such as Future Group and V-Mart Retail said they are also seeking permissions from local authorities.

"Some parts of the businesses will reopen. What we see is that there is the possibility of opening of some standalone stores...We will open wherever we can and we will talk to the local authorities to open. We will have to see how it works out.

"In any case individual states will have to come out with clear guidelines. While some states have come out with the guidelines but they are the same as what Centre has said. I think the states are also confused and they are printing the same thing that Centre is sending," RAI CEO Kumar Rajagopalan told .

Expressing similar concerns, CAIT Secretary General Praveen Khandelwal said, "The traders will be in a dilemma".

When asked whether things are expected to change on the ground with the phase 3 of lockdown beginning Monday, he said there is "lack of clarity and confusion over what constitutes a neighbourhood shop and a standalone shop".

He asserted that the "clarification should come from the right quarters. Not only the Centre, it is the duty of the state governments to issue that clarification because most of the issues are under the domain of the state governments, the law enforcement authorities also function as per their directives".

National General Secretary of the Federation of All India Vyapar Mandal, V K Bansal said, "The biggest problem with the guidelines is that it all depends on the states. The states frame their own policies and do not want to take any responsibility. The Centre wants relaxation but states are restrictive".

While wholesale markets are not allowed to open in red zones in Delhi, he said, standalone shops can open but the state government's role was crucial in implementation of the Centre's guidelines.

Bansal added that unavailability of migrant labour was a major issue faced by shop owners, restricting their operations.

According to the leading retailer Future group, the company would now start retailing other than non-essential and food items wherever allowed after the new notification.

"Inside Big Bazar, we would be now able to sell not just food and essentials only but also other items as crockery, kitchenware and general merchandise. Even at Big Bazaar, at certain places we would start selling other products apart from food," said a Future group official.

The Future Group, which operates in several formats such as large stores Big Bazaar and neighbourhood store Easyday, said that the company is in the process of obtaining permission to open the stores in the green zone.

"Wherever, we have standalone stores in the green zone, we are also figuring out with the authorities when to start operating," the official said.

According to another Future group official, most of its big format stores like Big Bazaar are in malls, which have been kept closed even during the second phase of the lockdown.

"The standalone stores of Big Bazaars were already operating. Some of our stores are in non-mall areas and we have written to the local authorities seeking permission for that," he said.

Around 80 per cent stores of Big Bazaar are operational with several restrictions such as timing, number of visiting and retailing activities limited only to essential items, the official said.

Value fashion and lifestyle products retailer V-Mart Retail also said it is gearing to open the stores in the green and orange zone but reiterated that there is a need for clarification on the difference between malls and standalone stores, specially in small towns.

"We have around 62 stores are in green zone and 98 are in orange, where there are chances that the stores would open. We are in talks with the local administration to allow the stores to open," V-Mart Retail Chairman and MD Lalit Agarwal said.

He, however, said it will be a gradual opening as initially people would hesitate to come into the store.

"We expect all our stores to be opened in phased manners and in the initial month only 20 per cent customer would visit," Agarwal said.

He sought greater clarity from the government on the differentiation between a mall and standalone retailers.

"In the small towns, there are no malls and they (local authorities) misunderstand small standalone stores like us for a mall and prohibit us from operating," Agarwal said.

Under the Ministry of Home Affairs guidelines, malls will continue to remain shut in all zones.

In red zone all malls, market complexes and markets will remain closed in urban areas, which are within limits of municipal corporations and municipalities. However, shops selling essential goods in markets and market complexes are allowed.

All standalone shops, neighbourhood shops and shops in residential complexes are permitted in urban areas without any restrictions of essential and non-essential. In rural areas all shops, excepts malls, are permitted to open without any distinction of essential and non-essential but social distancing has to be maintained in all cases.

In green and amber zones there are no such restrictions for marketplaces, neighbourhood and standalone shops.

Malls, cinemas & retail shops may be allowed at night in green zones


The government feels this will allow shopping and leisure activities to start up while maintaining physical distancing as traffic will be less than usual and easy to control. On Wednesday, Madhya Pradesh notified retail stores to open from 6am until midnight.

The government has begun internal discussions on allowing malls, cinema halls and local retail stores to open at night in green zones as part of a strategy to resume business in stages.

The government feels this will allow shopping and leisure activities to start up while maintaining physical distancing as traffic will be less than usual and easy to control. A final decision will be taken after the health ministry approves such a move, following which the home ministry may issue an advisory, government officials aware of the deliberations told ET.“Opening up will help the economic activity (get) going,” said one of them.

Some states are also keen to adopt such flexible timings. On Wednesday, Madhya Pradesh notified retail stores to open from 6am until midnight.

Making stores accessible for 18 hours would ensure there’s no crowding.

The labour ministry’s model Shops & Establishments Act 2016 has a provision to allow retail stores to stay open round the clock, but this wasn’t adopted in its entirety by all states, barring Maharashtra. Earlier this year, the latter state gave stores the choice to stay open all night, depending on footfall and security provisions.

The retail sector, which has been hit hard by the lockdown, is keen on the plan.

“It makes a lot of sense to allow malls and other retail shops to operate longer hours at night as it allows social distancing and would ensure panic buying does not happen,” said Kumar Rajgopalan, CEO of the Retailers Association of India (RAI) lobby group.

This will help curb job losses in the sector, which is facing retrenchment of at least 30% since the Covid-19 outbreak began, RAI said.

The association had estimated, before the pandemic, that opening stores for a longer duration will lead to a 10-15% increase in employment in the sector over the next three years.

Non essential e-commerce in the red even in green & orange zones


As per estimates by Forrester Research, regions in Green and Orange zones accounted for 30-35% sales of ecommerce firms prior to the lockdown.

Ecommerce leaders including Amazon and Flipkart have been able to recover only one-fifth of their pre-Covid-19 demand even after they opened up sales of non-essentials across smaller towns and cities which fall under the Green and Orange zones, as per analysts and industry insiders.

These companies said initial orders have come in for electronics, phones, kitchen appliances, even as they await the opening up of business in high-demand areas which fall under the Red zone.

As per estimates by Forrester Research, regions in Green and Orange zones accounted for 30-35% sales of ecommerce firms prior to the lockdown.

This is also because offline stores have opened and they had faced several headwinds during the lockdown, including forced cashless payments, longer delivery timelines and limited selection.

In some cases, etailers said they have not been able to open up fulfillment and sorting centres that fall in the Red zones, where infections continue to rise. “Ministry of Home Affairs (MHA) guidelines didn’t clarify the operations side of ecommerce... And, hence, confusion among local authorities for non-essential warehouses in Red zones is still there,” said a top executive at an e-commerce firm on condition of anonymity.

Non essential e-commerce in the red even in green & orange zones
A report by RedSeer Consulting also points to customers in smaller cities and lower-income groups curbing discretionary spending, which means spending on e-commerce will remain lower than normal as they largely service non-essential and discretionary categories. “The outlook for the industry looks bleak,” said Satish Meena of Forrester Research. “We have already reduced our growth forecast for 2020 to around 6%...as of now, there is limited demand plus credit is also going to be difficult,” he said. Without disclosing order volumes, ecommerce companies confirmed that people have only bought items that they deem essential in the last 48 hours, including electronics, laptops and home appliances, partly due to pent-up demand from the last 40 days.

Apparel has been hit the worst, they said. “We are seeing an increase in searches for products in categories such as laptops, consumer electronics, mobiles, air conditioners, coolers, t-shirts, and other essentials,” said Anil Goteti, senior vice-president at Flipkart.

“We urge the government to allow an expanded list of priority products in the Red zone which will not only serve urgent needs and spruce up economic activity but will also ensure citizen’s safety in a high-risk area,” an Amazon spokesperson said.