Unlike the past, electronics sales down this Eid

The sales of electronic home appliances usually pick up ahead of Eid-ul-Fitr as retailers introduce new models and offer discounts and consumers are awash with cash.  

But the scenario has been disappointing for retailers so far this year as sales have been down by as low as 20 per cent since customers have tightened their belts for the higher cost of living.

Bangladesh, like many other countries, has been hit hard by the fallout of the Russia-Ukraine war as the world is reeling from deep uncertainty, the energy crisis and higher inflation. As a result, many consumers with a lower level of disposable income have cut down on non-essential spending, particularly the expenses related to home appliances.

Retailers say consumers are leery about opening their wallets to buy non-essential items amid the ongoing economic crisis and inflationary pains.

Although industry-wide data on the sales of electronic home appliances are hard to come by, the sales records of individual companies, both foreign and local, are showing a slump in demand.

Major players in the domestic consumer electronics market are Walton, Transcom Digital, Rangs Electronics, Rangs Toshiba, Best Electronics, MyOne Electronics Industries, Jamuna Electronics, Pran RFL (Vision), Esquire Electronics, Electra International, and Super Star Group.

Foreign companies such as Samsung, LG, General, Sharp, and Whirlpool are also popular among local consumers.

"People are prioritising essential expenditures instead of home appliances due to the inflationary pressures, declining disposable incomes, and a spike in the prices of electronic products," said Ritesh Ranjan, head of business at Transcom Digital.

"The sales of electronic home appliances have slightly increased after the middle of March. But it is still 20 per cent down from normal times."

Inflation in Bangladesh has been at an elevated level since the middle of 2022 owing to the higher global commodity prices and shortage of US dollars.

The Consumer Price Index jumped to a seven-month high of 9.33 per cent in March as food prices rose and the adjustment of oil, gas, and electricity prices took hold. This means the spike in the CPI was just behind the 10-year high of 9.52 per cent seen in August last year.

Besides, a 25 per cent fall in the taka's value against the US dollar in the past one year has made imports expensive.

"The price of electronic items has risen by 15 to 20 per cent because of the dollar price hike," said Ranjan.

Except for televisions, the sales of almost all home appliances, including chest refrigerators, have increased ahead of Eid, he said, adding that the sales of air conditioners have increased significantly due to a spike in temperatures.

Didarul Alam Khan, chief marketing officer of Walton Hi-Tech Industries PLC, described the demand for Walton's products as good although sales in the electronics consumer goods sector are lower compared to normal times.

He said due to adverse global conditions, the business sector across the world went through a tough time in January-February. Sales of Walton's various electronics products were lower in January-February than normal times. But sales have returned to the positive territory in March.

The sales have accelerated in April since Eid-ul-Fitr is approaching. And it is expected that sales losses in the first two months of 2023 would be recouped this month, he said.

Walton's Digital Campaign Season-17 is running now on the occasion of Eid. Under the campaign, the company is offering 101 household products free or cash vouchers up to Tk 1 lakh against the purchase of Walton fridge, TV, air-conditioner and washing machine.

Md Manzurul Karim, general manager of Esquire Electronics, the sole distributor of Japanese electronic brands General and Sharp, says usually, a buying spree is seen ahead of Eid, but that sentiment is absent this year as most people can't afford luxury items.

"The number of customers is very low," he said, adding that the sales of ACs are better and this is seasonal.

Esquire Electronics has 80 outlets and more than 400 distributors across the country. The business trend is the same in all of them, said Karim.

"In the past, people would come to us to replace their old home appliances with new ones. But there is no sign of that this time."

Referring to Esquire's assessment, Karim said the market would remain dull in 2023. So, the company has reduced the import of products.

"The sales are yet to gain momentum although Eid is knocking at the door," said Kazi Ashiqur Rahman, company secretary of Singer Bangladesh.

"The market situation is not positive for the electronic consumer goods industry due to higher inflation. Consumers are prioritising essential items such as clothes and foods for the Eid festival."

Shahriar Bin Lutfor, director and head of business of the consumer electronics division at Samsung Consumer Electronics, said Samsung is running the Eid campaign, with a range of offers and promotional prices on TVs, refrigerators and washing machines.

"We are experiencing a good number of customer footfalls in our showrooms and they are checking our innovative solutions to make their life convenient."