No Inflation In The Lifestyle Segment
A customer at Vibe, a lifestyle store, at Race Course in the city. Soaring prices are worrying every industry as it has intensified their struggle for survival. Raw materials have never been so expensive and labour charges so exorbitant, industry sources say. However, the only business on which, inflation has had no apparent impact is the lifestyle segment.Even in a ‘developing metropolis’ such as Coimbatore, which is still acquainting itself with the concept of leisure shopping, the business of lifestyle stores remains intact. According to the people in the business, their target audience is the upper middle class, which has a higher disposable income and thereby does not compromise on buying products indicative of a luxurious lifestyle. Also, the younger crowd has a lot more money to spend and they do not hesitate to splurge.
It has also got to do with the city growing into a full-fledged metropolis. “The whole idea of a garden café was new to Coimbatore when ‘Vibe’ was launched about two years ago. Now, the demand is on the rise and the market is opening up for lifestyle products and services,” says Shankar Vanavarayar, the owner of Vibe, a lifestyle store in the city. The outlet sells materials on home décor, art and craft items and clothes. It also has a café – Atmos. Though the rates at the café have been revised marginally, the number of customers frequenting it has not declined. Since most of the items at the store are sourced from various States and the transportation costs and charges of artisans have increased, the cost of the products would have to reflect the increase, though marginally, he says.
Apart from food and clothing, mobile phones too play an indispensable role in making a style statement. According to an authorised Nokia dealer, there were people who upgraded their cell phones once in three months. This trend has slowed down a bit probably because the prices have not dropped in a long time, he says. With high-end electronic goods and branded furniture too, the story is not very different. The sales of these have not dropped phenomenally.
According to Ranjana Singhal, the owner of That’s Y Food, a multi-cuisine restaurant at R.S. Puram, the profile of an average consumer in Coimbatore is changing rapidly. People are becoming aware of luxury products and are willing to spend on them. The restaurant gets a mixed crowd, mostly upper middle class and above. “And, those who come here do not scrounge, especially the youngsters. They start with the drinks and finish up with desserts. It’s not just about eating. It’s also about enjoying the ambience,” she adds.
Even though these businesses seem to be doing well, staying afloat has become a tad difficult. “In the last six months, the prices have increased so much. I am paying Rs. 78 for a kg of Basmati rice, which was only Rs. 58 a kg. Chicken is also Rs. 76 a kg,” Ms. Ranjana says. Though not severely, revenue generation has come down a bit. The cost of food has not been increased to match the rising prices of raw materials. It is only increased by 10 per cent every year, she adds.Though not immediately, a prolonged spell of increased prices can make the going tough even for the lifestyle sector, says Harihara Subramanian, Chief Manager of Vibe.
