COVID-19 Second Wave and the Indian Mattress Industry
Slowly the Indian economy is opening up after the second wave of the COVID-19 outbreak. Just like the first wave, several sectors got affected during the second wave lockdown to varying degrees. The severity of the second wave has meant that it has caught everybody off-guard with several states across the country announcing extended lockdowns, crippling businesses. As we write this article, states like Karnataka, AP, Kerala etc are still under lockdown. This has meant restrictions in terms of the movement of most goods and services, with the mattress industry also facing the brunt of it.
SECOND WAVE AND THE INDUSTRY SECTOR
Global rating agency S & P cut its 2021-22 growth forecast for India from 11 per cent to 9.8 per cent saying that new infections were derailing a ‘promising’ recovery. Earlier Moody, another rating agency, too had cut its growth forecast from 13.7 per cent to 9.3 per cent. However, industry analysts have pointed out that not all businesses will be equally impacted due to the second wave. Sectors like ICT (Information, Communication, Technology), Healthcare, Financial Services, Consumer Goods and a few others are likely to do significantly better than others. Also, in spite of the current dark clouds, the markets have been hitting record highs indicating investor enthusiasm. Investors believe that the present troubles are a transitory phenomenon. The growth opportunities offered by the Indian market in the medium to long term continue to be high in spite of short-term hiccups. Most companies have extended work-from-home policies for the near future. This coupled with lockdown restrictions across the country has meant that most families are inevitably spending their time at home more, compared to the brief hiatus witnessed a few months back after the first wave had seemingly receded.
MATTRESS RETAIL SEGMENT
Latha Sridhar, an HR consultant says that this has meant opportunities for those selling work-from-home furniture and even mattress sellers. “Some of the companies I consult with, offer their employees some kind of monetary assistance to buy or rent necessary furniture required to enable them to work from home more productively. This has meant greater sales for the likes of those who sell tables, desks, chairs and home furniture including mattresses. This is because of the compact nature of most Indian homes. Given that the entire family is using different sections of the home too, either the kids or the parents are choosing to work even from their bedrooms which has meant upgrading their mattresses too.
This is echoed by Shafique Rehman runs multi-brand furniture and mattress outlet. “The present set of circumstances has meant that people’s sleeping cycles have gone for a toss, they spend more time in bed and they naturally want that to be more comfortable. I have seen an uptick in demand for both work-from-home furniture and mattresses.” The retailer has been emphasizing the ‘health benefits of utilizing the right mattress to enhance sales. His statement is vindicated by Anil Kumar a software architect with an Indian software services provider who resides in a typical two-bedroom apartment in Bangalore. Kumar says that their ‘master’ bedroom has become his main ‘office’ as the other room is taken up by his kids with their grandma and his wife utilizing the hall to run the house. ‘I spend most of my time working on the mattress. That is when I felt the need to have a more comfortable mattress and therefore went in for an upgrade.’
MATTRESS INDUSTRY CHALLENGES & OPPORTUNITIES
The mattress industry has also felt the impact of COVID-19’s second wave. The online sales did not pick up as expected and showed a lukewarm response despite huge discounts being offered by many brands with free home delivery. Consumer demand for the mattress is at a very low ebb. This may get reviewed only in September when the festival season begins. Apart from this, the restrictions on goods movement, rising operating costs and inability to pass on price rises to customers have hit the smaller players harder than the larger ones.
“Taking a larger view of the present COVID-19 situation, the industry needs to focus on different areas other than traditional outlets to expand the marketing strategy”, says Mr S. Sundaresan, Secretary, of ISPF.
While there are challenges, Mr. Sundaresan points out a few examples where mattress usage has increased and thus, the opportunity to target those places “There are a number of mobile hospital units that have come out with beds and other medical facilities like Oxygen concentrators etc. Many schools have temporarily offered their school buses to convert into quarantine stations for the COVID-19 patients.”
“Due to a heavy surge in COVID-19 patients, Railways (Integral Coach Factory, Chennai) has converted many coaches into hospitals. Hence there is a surge in demand for mattresses. Similarly, as the tourist traffic has sharply fallen, many hotels which are located adjacent to Large Hospitals have offered their rooms for quarantine/hospital needs. Due to overflowing crowds in the primary health centres in rural areas, the rural consumer needs mattresses only to be placed on the floor due to paucity of funds to buy cots”, he says.
Mr Sundaresan feels that the Quarantine Centers near Airports & Railway stations may also have mattress requirements since many travellers who arrive from foreign countries are advised to go for a quarantine stay of over two weeks.
He suggests that the way to address the current challenges is to stick with quality. “We have to stick to the quality. The challenge with the Indian market is that the industry has no room to capitalise on the purchase, unlike other products. The mattress is not purchased every few days or weeks. It is done once in five or eight years. We should stick to good quality and not compromise on quality”, he says.
Rehman, the mattress dealer, is gung-ho about the prospects and is upbeat about his business. Recently he invested in setting up a website for his store so that customers could browse and place their orders. “We want to be an omnichannel offering. Whether it is physical retailing or an online presence, we want to be where the customer wants us to be,” he adds.
CONCLUSION
COVID-19 lockdown is a temporary situation. Businesses will be normal in a few weeks. Once the lockdown is lifted, demand for the products will rise and it would be business as usual. Even during the lockdown, industry players are using the online medium to sell their products. After all, life is about accepting the challenges along the way, choosing to keep moving forward, and savouring the journey.