Summer product sales take a rain check as demand falls 15% in past week
Companies that make and sell summer staples such as soft drinks, beer and ice cream are rushing to adjust daily retail stocks across Indian cities, as unexpected and persistent summer rains have dampened sales.
Some companies are also rescheduling factory production to avoid excess stock in trade channels, with demand falling 15-20%in the past week-contrary to earlier forecasts and expectations.
Executives said they are moving away from predetermined stocking and instead adjusting inventories dynamically in response to local demand shifts to reduce the risk of overstocking. Some are also localising marketing campaigns in real time.
"Unexpected summer showers are challenging traditional forecasting and operations," said Angelo George, chief executive of packaged water company Bisleri International. "We are enabling
agile logistics
and
dynamic inventory management
at plants near consumption centres."
Rahul Singh, founder of the beer chain The Beer Cafe, said, "With sudden rains during peak summer, we are localising campaigns on-the-go and tweaking supplies dynamically due to unpredictable weather."
For soft drinks, sales in North India-which have been growing in double digits this summer season-took a hit over the last five days. Sales had already been under pressure in the South and East.
"Rains across the North, which is our most crucial summer market, dents sales on a daily basis significantly," a senior executive at one of Coca-Cola's largest franchise bottling partners said on condition of anonymity.
The weather disruptions come at a time when many seasonal brands had ramped up advertising and stocking in retail stores and quick-commerce platforms, anticipating strong demand amid rising temperatures.
Ice cream brands such as Amul, Havmor and Baskin Robbins have been advertising aggressively, while
Hindustan Unilever
recently introduced a new ice-cream brand, Dairy Factory, under its Kwality Walls franchise.
On Saturday, India Meteorological Department (IMD) forecasted heavy rainfall and hailstorms across East and Central India, Gujarat, Rajasthan, Punjab and Delhi-NCR over the coming week due to western disturbances and cyclonic circulations.
Over the weekend, minimum temperatures in Delhi-NCR reduced by 8 degrees Celsius after heavy rains and storm on Friday morning.
While summer product makers have been working to de-seasonalise demand through off-season consumer deals and promotions, the March-July window still accounts for over half of their annual sales.
Executives said they remain hopeful that demand will normalise in April-June quarter, with hotter temperatures expected by next month.
"We have said we will grow double digits in the year. And that is what we stick by, because each month is different and weather patterns completely change each month. Sometimes the rains are earlier, sometimes the rains are later," Ravi Jaipuria, chairman of PepsiCo's bottling partner
Varun Beverages
, said during an analysts' call last week.
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