Fear of the future freezes festive sales
Sharp rises in the prices of many goods and the unprecedented political crisis are affecting businesses at this critical sales time of Christmas and the New Year.
Shoppers say the rising cost of living and political instability have made them cautious about how they spend their money.
“I have worked here for 32 years and I have never seen a period as bad as this,” lamented K.P. Upatissa, an employee at a retail clothes shop in Pettah.
Mr. Upatissa said the shop he works at used to have 10 employees. “Now, there are only two and even so we just sit around most of the day waiting for customers to turn up.”
With schools now closed for the holidays and the commencement of the festive season, many toy vendors are setting up stalls around Pettah in any available space they can find in the narrow and busy streets.
The rapid depreciation of the rupee against the dollar has severely affected business, toy seller Zuhair Ameer, 48, said.
Pointing to some toy cars on his stand, Mr. Ameer said, “These were selling for Rs 750 only a few months ago. Their price has now gone up to between Rs 850 to Rs 900.”
Wholesale traders were charging more for the goods, saying they needed to pay more to import them. A father of three children, Mr. Ameer is worried about the future.
V. Dewakumara, 31, who sells Christmas decorations, has also been hit by the fall in the rupee.
“I sold a small a pack of Christmas tree ornaments for Rs. 550 last year but when I bought it from the wholesellers this year, it cost Rs. 750,” he said.
Mr. Dewakumara said he was forced to sell the items at the old prices because customers would not buy them at higher prices.
“There is no profit from this year’s Christmas season. There are fewer customers buying items from us in comparison to last year,” he said.
Mr. Dewakumara is the sole provider for his family – his wife, three children and uncle and aunt – and admitted he was finding it hard to earn enough to support them.
The retailers’ woes are feeding through to the wholesalers. Wholesale cloth seller Velusami Ananda, 55, who has been trading in Pettah for 20 years, said customers used to stream in from the time he opened his doors at 8am. “Now, we struggle to attract customers even by midday,” he disclosed.
V.K. Sundar, who works at a nearby wholesale shop selling children’s clothes, said there are only one or two buyers a day now whereas there used to be about 10 a day previously.
A shop specialising in women’s footwear is also doing poorly. With the railway station and the main city bus stand being so close, many shoppers from outside Colombo frequent this shop – but now they are not spending much.
“People are scared to spend a lot as the dollar rate keeps climbing,” an employee said. “A customer who used to buy three pairs of shoes is only buying one pair now.”
“Many women from the outstations come to Pettah to buy saris and other items for wed- dings and other functions. They stop here to buy their shoes, but that crowd has dwindled in recent times,” another employee added.
Another street vendor, Mohammed Fazly, 46, sells plastic Christmas trees from November until the New Year, when he reverts to selling children’s school items.
He said the cost of trees had risen by as much as Rs. 750 compared to last year. “But we sell the trees at a much lower amount,” he said. Thankfully, sales have been steady so far, and Mr. Fazly expects them to pick up as Christmas draws closer.
Customers are cautious over spending. Pushpa Subasinghe, 44, was in Pettah with her children to purchase school items such as shoes, notebooks and bags. Ms Subasinghe said they were careful about their spending and found prices of such items to be a little lower compared to last year.
Price controls and the depreciation of the rupee are not being addressed due to the political uncertainty, a husband and wife who requested anonymity said.
“People only go festive shopping if they have money with them. To celebrate there must be money” the couple pointed out.
Shoppers say the rising cost of living and political instability have made them cautious about how they spend their money. Pix by M.D. Nissanka
Pettah: Tis the season for Christmas decorations