Why Consumer Durables Sales Are Still Under the Weather?

Unseasonal rains have impacted demand for some of the consumer durable products, although lowering input costs have helped, volumes would continue to remain a challenge resulting in price pressures

- SHRABONA GHOSH

Erratic environmental conditions wherein consumers continue to struggle and adapt to the changing weather patterns have not only caused health concerns but has also impacted demands for some of the consumer durable products in the first quarter and the effect might linger long. "Unseasonal rains have impacted demand for some of the consumer durable products in the first quarter, but the industry should have recovered a bit in June given the monsoon delay. Although lowering input costs have helped, volumes would continue to remain a challenge resulting in price pressures. Apart from the cooling segments, the other durable players have been witnessing decent growth rates especially in the B2B segment, indicating a positive sentiment. A good monsoon could result in healthy rural demand and that combined with lowering inflation could translate to revival of rural demand for mass market durables," said Pallab Roy, partner, Business Consulting, KPMG in India.

Weather patterns will continue to dominate growth patterns for cooling product players. "Competitive intensity and pricing will be key elements to watch out for," Roy explained.

IMPACT ON SUMMER-CENTRIC PRODUCTS

While the overall consumer demand for small appliances has been robust, unseasonal weather in Q1 Impacted the demand for summercentric products. "The unseasonal rains pose significant challenges for various industries and can influence consumer demand patterns. Cooling products such as air conditioners, fans and coolers, might be particularly impacted as consumers might delay or reconsider purchases until the weather stabilizes. Consequently, manufacturers may face fluctuations in production schedules and inventories for such items," said Gulbahar Taurani, MD & CEO, Versuni (formerly known as Philips Domestic Appliances).