Delhi based Ply Mahal is known for offering diversified decorative panel. They also promote their Panel to other retailers mainly North and Eastern India. Seeing the bright future of retail business they are expanding their Showroom area. A quick talk with Mr. Pankaj Kumar, Owner, Ply Mahal on present market scenario for ‘Ply Reporter’s Retailers Angle’ column.
How was the demand scenario in Sep-Oct?
The demand is good and the market in September was very good. This time the demand is 25% higher to the normal period in previous years even before Covid time. For the decorative industry, I think this will go forward as after covid people are more inclined to have decorative products instead of using a polishing product for their interior, the reason being less time consuming. This is a decorative industry; so it will not be facing any bigger impact of price rise issues in the industry
What are the reasons of such good demand?
Due to lockdown, things which were slow moving have become much faster with ease in covid cases. There are few backlogs and upcoming work excursions are faster now. People want quick finishing of work. Still the covid guidelines are prevailing, so people want to get their work executed as soon as possible. The demand is due to that, as people want to use the time with relaxed covid cases. Today the supply is 50% faster, so the demand is definitely higher.
What effect do you see out of raw material price rise and difficulty in imports?
There is no effect on retail, but importers' investment has multiplied by 3 to 4 times. The decorative items rate has dropped by 40% to the earlier ones due to competition. When it was sold earlier, why not today? In the last six months everyone has a new range of products and we are prepared for the next six months. The decorative industry cannot go forward without innovation and the industry will never take a hold due to price factors.
In this scenario, do you think that the retailers’ margin has been affected?
Definitely not! This is a trick of the trade. In the decorative industry you can manipulate the prices whatever you want. This is a general trend that price drops due to competition and it goes up due to shortage. At present prices are going up due to shortage and raw material price hike but the demand is going down is not the case till date. Today every industry segment is observing price hikes. Then how will the demand drop? Almost all commodity prices fluctuate to a greater extent still its demand never goes down.
In 1 mm laminate price rise is approx Rs 200 per sheets by brands and the similar situation is in PVC laminate. So, what impact do you see on sales?
Those who have requirements will definitely buy and use it. The price rise scenario is everywhere, so the customers have no choice. It is a general phenomenon that when price is on the rise people remain hesitant for investment so it is happening at present. Even distributors are hesitant to purchase, but the manufacturers do not manufacture the same capacity what is being consumed, they sometimes stock. So, they are suffering at that level, not at the demand front. Today the retailers have to serve their customers with whatever the rate is there in the market. They cannot deny a particular product for what they are known for. This is happening across the segment in the building material industry.
Laminate is an interior product which is used in very less volume in an interior work. Today five sheets of laminate are sufficient for a kitchen. But the same is consuming even much costlier products like boards, hardware, and appliances, and those price fluctuations will be felt on other products also.
Don’t you think that the current higher demand will come down in December onwards?
It will go up to March. This is a general tendency of the market that it turns from March to September. After that there will be some changes and the demand may go down. The disturbance caused by COVID will take 6 to 8 months to settle down. So, the demand will be there for at least six months.
What is your suggestion to other retails?
For price rise, there is no benefit in holding the sales. On the contrary, we should accept the price as soon as possible so that we can offer the latest products and the innovations will continue. If we suppress the industry on rates, they will not be able to innovate. If the market accepts then what is the difficulty in raising the price of a product. The retailers are at an advantageous stage, as they have to ask the price after showing the product, but the manufacturers are at greater risk with stock of raw material, innovation and manufacturing, promoting and advertising then they can ask for price. The Indian industry has a lot of scopes, so there is no benefit in holding the sales at this ground.