The companies are hiring thousands of temporary workers, expanding to smaller cities and launching new products as the country prepares to celebrate its peak festive season without COVID restrictions for the first time in three years.
Many people in the country of 1.4 billion decorate their homes and buy new clothes, cars, phones and other goods en masse around the Hindu festivals of Durga Puja and Diwali between September and November. E-commerce majors Amazon and Walmart’s Flipkart have already announced deeply discounted sales.
The Confederation of All India Traders (CAIT), which says its 80 million small-and-medium-business members generate annual sales of more than $1.5 trillion, forecast sales this Diwali season will be at least 30% higher than last year.
“Consumer sentiment is very upbeat after two years of restrictions,” said CAIT Secretary-General Praveen Khandelwal, who has travelled to many parts of the country this month to urge traders to stock up and ensure they have a variety of products to compete with online players.
He said demand for CAIT members has already come back to more than 90% of pre-COVID levels.
Though annual retail inflation snapped a three-month downward trend to accelerate to 7% in August, Khandelwal said the trick was to offer customers options that suit their budget, something on which he was holding sessions across the country for businesses he represents.
Ecom Express, which delivers products on behalf of e-commerce firms, said it had doubled its parcel-processing capacity to 6 million units per day and expects volumes to soar up to 65% in the festive season, with much of the growth coming from smaller cities.
Smartr Logistics, which began operations a year ago, said it was expanding into a dozen mainly smaller cities, apart from adding new centres in many other big cities like New Delhi where it already has a presence. It cited growing demand around the time of the festivals, and its goal of connecting smaller cities.
“We aim to strengthen connectivity beyond the metro cities to bring about better accessibility and ease of doing business for smaller and medium enterprises in tier-two and -three cities,” Smartr founder Yogesh Dhingra said.
Online delivery platform Dunzo, backed by retail-to-energy conglomerate Reliance Industries, said August had been a busy month due to its many festivals and that demand during the overall Diwali season typically rises by up to 30%.
“We have planned our inventory in such a way that we stock our assortments based on the festivals that are celebrated in each and every city,” Dunzo executive Mrunmayi Oke said.
Logistics operator Delhivery Ltd said late last month it would create more than 75,000 seasonal jobs around September to cater to “significantly higher volumes during the festive season”.
Automakers like Tata Motors, Mahindra & Mahindra and Maruti Suzuki have either launched new models recently or are planning to do so soon.
Industry body Society of Indian Automobile Manufacturers said earlier this month that while a good monsoon and the upcoming festive season were likely to increase demand, high fuel prices were a concern.