Apparel retailers have witnessed a surge in demand for formalwear as life returns to normal and consumers flock back to offices. Retailers such as Raymond, Westside and e-commerce marketplace Myntra have witnessed a steady increase in demand for officewear since January. Myntra reported that sales in the category have doubled in the last three months. Raymond, which saw a contraction in the category as the pandemic struck the country, says sales have now recovered to pre-COVID levels.
“Pre-Diwali we were at about 65-70 percent of FY20 levels in the formalwear category and still 30 percent below pre-COVID. During the festive period, we recovered about 85 percent. However, in February, we were back at pre-pandemic levels,” said Bidyut Bhanjdeo, Head - sales, large format stores and e-commerce, lifestyle business – Raymond.
The surge in sales, said Bhanjdeo, is on account of offices reopening and also weddings, which see huge sales of men’s formalwear.
Westside, too, reported a similar trend. “Remote working in loungewear during the pandemic has left professionals yearning for new wardrobes as they embrace hybrid working. We've definitely seen a jump in formalwear for both men’s and womenswear,” said Umashan Naidoo, head of customer, Westside – A Tata Enterprise.
Formal footwear is also back in demand as consumers step out. Gunjan Shah, MD and CEO, Bata India, said the company is witnessing sustained growth in the formalwear segment quarter on quarter. “With a continued decline in COVID-19 cases and people returning to offices, we are inching closer towards normalcy. As people step out of their houses, they are looking to leave behind loungewear and update their wardrobes with suave formals,” he added.
Casualisation of ‘formals’
Even before the pandemic, apparel retailers had witnessed a consumer trend towards ‘casual formal wear’ such as chinos and cotton shirts. However, with the pandemic, as people worked from home, demand for formal clothing was wiped out entirely.
“We witnessed consumers going for athleisure wear such as shorts and roundneck t-shirts,” said Bhanjdeo of Raymond.
Several apparel retailers, especially the ones with a large formalwear portfolio, had witnessed a significant drop in sales. Raymond had reported a 45 percent decline in its FY21 revenue to Rs 3,648 crore from Rs 6,571 crore in the previous year.
Formalwear brands had resorted to launching casualwear ranges as the pandemic wreaked havoc. Aditya Birla Fashion and Retail, which has several brands positioned in the formalwear segment, launched a sub-brand, Denim Labs, under Van Heusen, while Bombay Shirt Company introduced two casualwear brands, Cityof and Korra. Raymond had also introduced a casualwear range.
The trend, however, is seeing a reversal now and brands are again adding formalwear to their inventories.
“We have revamped collections in both Men’s and Womenswear to ensure that the range is not only relevant for dress-down workwear but also smart for business,” said Naidoo of Westside.
According to Padmakumar Pal, Vice president and business head, apparel, Myntra, the e-commerce marketplace has added 5,000 new options to its workwear portfolio in the last three months.
“Right from fashion basics like white and black shirts, khakis, trousers to the latest Spring Summer collection from popular domestic and international brands, we will continue to expand the portfolio and widen the spectrum of selection and brands in the category,” he added.
After a turbulent two years, the retail industry has finally recovered. A recent report by the Retailers' Association of India said that sales in February 2022 showed growth of 6 percent from pre-pandemic sales levels (February 2020), and 10 percent compared to sales levels in the same month (February 2021) last year.
The consumer durables and electronics category grew 31 percent, food and groceries jumped 33 percent and QSR surged 38 percent compared to February 2020, and 28 percent, 19 percent and 16 percent, respectively, compared to February 2021 (Y-O-Y), the report indicated.
The Apparel and Footwear categories have also witnessed double-digit growth (Y-O-Y) with a steady decline in the rate of COVID-19 cases, the report said.According to CRISIL, after the 40 percent decline last fiscal because of COVID-19, the revenue of brick-and-mortar apparel retailers will grow 20-25 percent on-year this fiscal, driven by a strong recovery in demand despite the third wave of the pandemic.