Retailers in Bangladesh are surely in for some tough time. Unlike other years, Pohela Boishakh (Bengali New Year) and Eid-ul-Fitr have failed to yield much business, thanks to COVID-19!
“Preparations for Pohela Boishakh had been on in full swing like any other year,” said Shaheen Ahmad, President of Fashion Entrepreneurs Association of Bangladesh (FEAB) and top executive of fashion house Anjan’s, adding that there had been, in fact, a bit of extra effort this year, as Eid followed close on the heels of Pohela Boishakh. Sales had already picked up from February itself on the occasion of Language Day (in February) and Independence Day (in March), with anticipation of Pohela Boishakh and Eid, being the icing on the cake. But as the days went by and it was almost the middle of March, sales started to take a nosedive and from 21 March, stores and shopping malls had to close down owing to the rapid spread of coronavirus.
As per FEAB, around 5,000 domestic fashion houses across the country, which targeted to sell products worth more than Taka 2,000 crore this Baisakhi, had to suffer losses to the tune of around Taka 1.25 billion in March itself. As per Mohammad Ashraful Alam, Chief Operating Officer, Aarong (the biggest lifestyle brand of Bangladesh), sales during Pohela Boishakh and Eid-ul-Fitr contributed to around 40 per cent of their annual turnover, which they missed and by quite some margin.
As expected and considering that social distancing had become the new norm, sales during Eid-ul-Fitr also failed to show any marked improvement, except for online channels, which even though picked up fairly well, but failed to match the overall sales volumes of previous years for most brands and retailers.
“Before the pandemic, only 5 per cent of our total sales came from e-commerce, but now it is about 50 per cent,” underlined Monnujan Nargis, CEO, Le Reve, adding, “The presence of customers in outlets is not that much like during Eids in previous years, when the shopping itself became a festival.”
It’s been around more than 2 months now that shops have opened and retailers are hoping that the upcoming festival of Eid-ul-Azha would bring some good luck. Shops have been keeping their doors open to greet shoppers, and if reports are to be believed, there’s been an improvement in customer turnout as well. Despite this, sales have been below the pre-pandemic level as consumer spending has still been mostly limited to only essentials.
“A section of people does not have enough money to spend because of job and income loss,” said Delowar Hossain Babu, General Secretary, Eastern Plaza Shop Owners Association, one of the oldest shopping centres in the capital Dhaka. “We see some sales of mobile handsets and cosmetics. Clothes and footwear sales have been dull. As weddings and other social festivals have almost been put on hold, the sales of saris and other items have been very weak as well,” he added.
Retail along with wholesale trades are important pillars of Bangladesh’s US $ 300-billion economy and are accounted for 13.92 per cent of the GDP at 2005-06 prices, as per Bangladesh Bureau of Statistics data. Further, according to the National Association of Shop Owners of Bangladesh (NASOB) and the Dhaka Metropolitan Shop Owners Association, Bangladesh has more than 2 million wholesale and retail outlets with capital Dhaka alone accounting for 2.4 lakh of them.
“It can’t be said that a lot has changed. Improvement has been very slow,” exclaimed Azharul Hoque Azad, Managing Director of clothing brand Sadakalo, adding that sales in some of the stores are too meagre to even make up for the electricity bills. Earlier too, before Eid-ul-Fitr, sales at the outlets haven’t been so good for Sadakalo, nor even the online sales.
“We are facing a devastating situation in our business. We thought online orders would be good, but it’s not,” rued Azharul.
Now to withstand the crisis, many retailers are offering discounts and giving increased thrust on boosting sales online, an area that entrepreneurs have not explored much before the outbreak of coronavirus, even though majority of consumers are still fond of shopping in bricks-and-mortar stores, and to bring in more of whom into the physical stores may have already started offering discounts like Walkar, a footwear brand of RFL Group, which has been displaying diversified products with attractive designs on the occasion of Eid-Ul-Azha. The footwear brand is also offering up to 15 per cent discount on purchasing of products. “Customers are getting 5 per cent discount on purchasing one pair of shoes, 10 per cent discount on two pairs of shoes and 15 per cent discount on three and more pairs of shoes from Walkar outlets,” claimed Kamrul Hasan, Chief Operating Officer, Walkar Footwear, adding, “Moreover, customers are enjoying 10 to 50 per cent discount on purchasing products from popular e-commerce site www.othoba.com as well.
Walkar Footwear has 70 showrooms across the country and has been showcasing wide array of offerings in ladies, gents and kids’ categories including formal and casual shoes, kid’s shoes, sports shoes besides, various fashion accessories including bag, belt, and wallets, etc.
“The extent of the crisis is such that it will not be possible to get rid of it. We are increasing our adaptability to make a turnaround,” said Khalid Mahmood Khan, a Director of Kay Kraft. Even before Eid-ul-Fitr, Kay Kraft offered 30 per cent discount if anyone ordered online.
Owing to the slump in turnout at retail outlets, many fashion houses and retailers took to revamping their web portals to be equipped to face the new reality and recover the sales lost from the bricks-and-mortar stores. “Many are still too afraid to leave their houses, let alone go shopping,” underlined Shahrukh Amin of Almira, another fashion brand.
As the unprecedented collapse in sales continues to bleed businesses, space owners expressed generosity, standing by tenants by reducing or waiving part of the rent. Even after that, many retailers are shutting stores or squeezing businesses to sustain. “We have to trim the size of businesses for a year,” said Amin, who accommodated two more brands in his space on Banani-11 to make it a multi-designer store while NASOB President Md. HelalUddin claimed that 10-15 per cent shops are closing outlets because of losses in sales and high rent.
“Businesses have been very bad. None is buying out of impulse,”HelalUddinsaid, adding that retailers are now hoping if Eid-ul-Azha (the second-biggest festival and ranked the third-biggest shopping season after Eid-ul-Fitr and Pohela Boishakh) could help regain the losses they have incurred since the outbreak of coronavirus, which was first reported in the country on 8 March.
“We expect sales will increase marking the Eid. We will be able to recover the losses to some extent if the Government allows to extend the shopping time by 2 hours,”said HelalUddin while Farhana Nazira, Owner of Farhana Fashion, said sales would increase if the Government allows them to keep the door open until 9 pm ahead of the festival.
“We will be able to recover some losses if we are allowed to keep stores open for 2 more hours,” she said, adding that in case there’s no good sale, “We will pass lean seasons for a few months after Eid. As a result, many would have to surrender spaces after Eid unless they can make some sales during the festival.”
Meanwhile, one of Bangladesh’s renowned fashion brands, SaRa Lifestyle Limited, which is the sister concern of Snowtex – an export oriented readymade garment company, has launched its new Eid collection at all its outlets in the country, as per media reports.
With Eid-ul-Adha just round the corner, activities in the SaRa outlets have reportedly gained momentum, with all safety protocols and mechanism in place, in view of COVID-19.
If women’s collection boasts of exclusive range of sarees, kurtis, printed three-pieces, party wear three-piece, party wear single-piece, denims and tops, men’s collection for the upcoming festival has cargo pants, denims and pyjamas, chino shirt, casual shirt, joggers, T-shirts, formal shirts, kabli, and panjabi, etc.
There’s also an exclusive collection of panjabi-pyjama, polo shirt, shirt-pant set, frocks, tops-bottom set, tops, bottoms, tops-skirt, three-piece, shirt, T-shirts, etc. One can also order SaRa’s collection for Eid online through its website and the social media.
Now, if Eid-ul-Azha could prove to the game changer in an otherwise dull year so far for the retailers remains to be seen.