Bengal markets hit: IT retail records 35% drop in sales

Since the time India was hit by the effects of the global slowdown last year,
the IT markets across the East have started seeing a downturn. And now, in JFM
quarter this fiscal, IT retail markets across West Bengal have recorded a drop
of 35 percent.

However, the case is acute in the Bengal upcountry markets which had been
witnessing a steep increase in the last two years. Now, backed by repeated
political upheavals across the upcountry and a drastic fall in retail purchases,
the Bengal upcountry has suffered drop in sales by 60 percent this quarter.

“Previously, the Durgapur-Asansol belt was lucrative and purchase orders were
high. With the onset of banks and expansion of branch offices in Durgapur, the
IT retail market was on a huge boom. But now, the situation is grave. With the
onset of the global slowdown, the purchases became less and the corporates
halted all orders for this fiscal. Even, the SMB segment is now refraining from
further purchases”, said Malay Bikas Sikdar, proprietor of The Computer Bazaar,
Durgapur.

Transactions in Durgapur-Asansol belt have become limited with a dip of over
65 percent sales in the end-user-SMB segment and a 60 percent drop in the
enterprise segment. What is keeping the business going in the region is the
purchases from Durgapur Steel plant and the small-scale PSUs there. In order to
revive the scenario in the region, dealers in Durgapur are planning to organise
an IT expo soon.

“We are planning to hold an IT expo to revive sales figures in the region.
Since examinations are going on this month and ICSE will soon commence, for the
time being we have hold our plans as we are looking at targeting the student
community with a message to spread IT awareness”, Sikdar elaborated.

Also, in North Bengal, coupled with the Gorkhaland agitation and the global
slowdown, Siliguri, Darjeeling, Kalimpong and the Hill Council area are direly
hit. However, Siliguri market has put up a brave show amidst the political
tension by maintaining it's stability faring a bit better then the entire state.

“Siliguri is a volatile region due to it's demography. Backed by the
political tension and the global slowdown, markets here are already down by over
40 percent. We had performed well for the last two years but now with inflation
making its way to the hills, we are only hoping that the situation gets better”,
lamented Prasanta Pandit, CEO, Mediacomp Point, Siliguri.

Speaking about the dismal condition in north Bengal, Pallav Surai, Branch
Manager - Siliguri, Rashi Peripherals said, “The condition in Siliguri is very
bad and in Darjeeling, it is worse. There has been a steep fall in sales at a
rate of 35 percent across the upcountry markets since this year. Primarily, the
global slowdown has resulted in poor orders backed by the repeated bandhs due to
the political tension here. Also, issues of dealers in the region making late
payments have surface. However, it is expected that by the end of March, things
will start moving ahead”.

The case of Bengal upcountry markets going down is similar to the situation
in Kolkata. Boasting of being one of the two A1 cities in India, markets are
sharply losing it's hold here too. Besides a steep fall in sales, small-scale
retailers here are facing a severe credit crunch in their trade.

Speaking about this issue, GK Mishra, proprietor of Jayco Exports, Kolkata,
said, “Normally the credit period offered by the distributors is a maximum of 21
days from the date of delivery. With a fall in retail sales now, it is taking
30-40 days for the stocks to clear. We have spoken to the distributors for an
extension of the credit period, but it has fallen an deaf ears.”

“Although we have seen an acute fall in sales in the OND quarter at 40
percent, this month, the situation has improved a little. Now, we are making
small-scale purchases from the distributors as footfall and enquiry calls has
decreased by over 400 percent,” he concluded.

The case is similar in the enterprise segment too. Corporate houses in
Kolkata are also showing restraint in making IT purchases and the overall
scenario is becoming gloomy.

“Markets are down by over 35 percent this quarter. To combat the scenario, we
are primarily focusing on reducing the circulating capital costs and reduce
depreciation”, commented Shyam Sunder Poddar, CEO, Netcom Infotech on discussing
steps to combat the stagflated market.

IT retail has started to lose its hold on West Bengal leaving the dealers
with a pale face. Across the state, dealers are optimistic that the recovery
phase will start soon and are opining that an IT expo can only save them from
the catastrophe of the global slowdown. In this measure, COMPASS has already
finalised the dates for their expo commencing mid-April and Durgapur is on it's
way to gear up for the oncoming expo.