Apparel retailers in the capital said sales are down 10-20 percent compared to last year.
“Weakening of rupee against US dollar increase our imports cost. This makes apparels dearer in the market, which will directly impact sales,” Suresh Shrestha, shift manager of Shrestha Tailoring Centre -- a renowned clothing chain in the capital, said. “Most of our raw materials have to be imported from foreign countries and we have to pay them in US currency.” [break]
US dollar was exchanged at Rs 95.25 on Monday. Exchange rate of rupee against US dollar hovered over Rs 88 in July last year.
Apparel sales are down also at United World Trade Center, according to Sandeep Hirachan, managing director of the mall. “Strong competition among retailers themselves and strengthening of US dollar vis-à-vis rupee are the major reasons behind drop in sales,” Hirachan said, adding, “Strengthening of US dollar raises import costs of traders which will ultimately lead to rise in prices.”
He further added that price of clothes might increase by 20-25 percent in the near future if rupee continued to weaken with other currencies.
According to traders, prices of apparels have increased by 10-20 percent in source country itself. Nepali traders generally import apparels from countries like China, South Korea, Italy and Thailand. In most of the countries, they have to pay in US dollar.
Bhat-Bhateni Supermarket has also seen drop in apparel sales over the past few months. “Monsoon is generally regarded as off season for clothing business. Also, the depreciation of rupee against US dollar has made apparels expensive which ultimately affected sales,” Ujjwal Gurung, assistant supervisor of Bhat-Bhateni Supermarket at Bhat-Bhateni, said. “Also competition among traders themselves has impacted sales as consumers now have more options to choose from.
Traders, however, are hopeful that sales will pick up in the near future as flow of money will be smooth with the announcement of full-fledged budget. They are also upbeat about the sales are major festive seasons are approaching.
Shrestha was also hopeful that hike in salary of government employees will lead to better sales.
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