COIMBATORE: With Deepavali just around the corner, the domestic garment market is yet to see its usual festive rush, as persistent rains and steep price hikes keep shoppers away and leave traders worried.
This year, the anticipated rush at Erode's bustling EKM Abdul Gani Textile Market is missing. "Traders at Gani Market used to record an overall business of over Rs 500 crore a week during these times in the past. Over the past few weeks, however, the turnover has dropped to a mere Rs 100 crore," said K Selvaraj, president of the Erode Gani Weekly Market Association.
Traders attribute the slump to a sharp increase garment prices that was driven up by the increase in prices of yarn, dyeing and other raw materials. This is prompting buyers to cut back on purchases or postpone bulk orders in the hope of a post-festival price correction. Continuous rain over the past week has further dampened sales.
The market, known for its affordable garments and competitive prices, has around 740 weekly shops and 300 daily shops. It usually attracts wholesale buyers from across Tamil Nadu and neighbouring Kerala, Karnataka, Andhra Pradesh and Telangana. Buyers typically arrive at least a month before Deepavali to purchase garments in bulk. This year, however, demand from neighbouring states as well as within Tamil Nadu has remained subdued.
The price increase has affected garments across segments. "Hosiery products manufactured in Tirupur have become costlier, with the wholesale price of a pack of 12 underwear pieces rising from Rs 360 to Rs 420. Add a small profit margin, and the selling price rises further. Buyers are therefore postponing bulk purchases and restricting themselves to minimum quantities. Many believe garment prices have been raised for Deepavali and will come down after the festival. This time, it does not feel like a festive season at all," said V Sundaram, another trader.
Shopkeepers said that chudithars sourced from Surat and Mumbai and children's ready-made garments from Kolkata have also become 10 per cent costlier. Towels manufactured by small-scale producers in and around Salem have seen price increases of up to Rs 10, while lungis produced by powerloom units in Kumarapalayam and Pallipalayam have also become more expensive.
Nightwear has witnessed a particularly steep increase. A nightie that previously sold for Rs 150 to Rs 190 a piece now costs around Rs 250, another trader said, attributing the increase to higher dyeing charges, yarn prices and other raw material costs.
The slowdown has hit traders at a crucial time, when Deepavali purchases normally provide a significant boost to business. However, MP Muthurathinam, president, Tirupur Exporters and Manufacturers Association (TEAMA), said the manufacturing sector had been able to withstand several challenges, including the ongoing unrest in the European countries, largely because of the good domestic market.
"The purchasing power in the Indian market is currently stronger than in the export market. Domestic trade in Tirupur is worth around Rs 35,000 crore annually," he said.
Erode Gani Market turnover plunges from Rs 500 crore to Rs 100 crore weekly
Wholesale underwear prices rise from Rs 360 to Rs 420 per dozen
Chudithars and children’s garments become 10 per cent costlier; nightie prices hit Rs 250
Buyers cut bulk purchases, hoping garment prices will fall after Deepavali
Tirupur’s domestic garment market is valued at Rs 35,000 crore annually