Lucknow Discretionary Retail Struggles: Shopping Malls Take a Hit

The Lucknow’s retail sector continues to face headwinds, with discretionary retail sales remaining sluggish in August. According to the latest Fashion Herald survey, total discretionary sales in local retail category increased by a mere 1.6% compared to the previous year ( data adjusted for inflation and currency depreciation). Shopping malls were the worst hit with footfall falling by 32% overall with only Phoenix Palassio, Lulu Mall and Fun Republic coming out as positive footfall drivers. However, footfall to brand sale ratio for Lulu mall was the worst amongst the leaders.

The retail fashion industry however saw a huge surge with budget fashion brands taking the chunk of market sales, with overall sales increasing by 18% year-on-year. This rise can be attributed to factors such as expansion of budget retail brands like Zudio, revivial in IT sector job creation, and shifting consumer preferences towards Indian brands over foreign brands.

Our industry experts however expressed concern about the ongoing challenges facing brick-and-mortar retailers. We noted that despite aggressive discounting strategies, brands again willing to invest in retail expansion and rise of flea market exhibitions,sales have not rebounded significantly. With rising energy bills and mortgage rates looming, consumers are becoming increasingly cautious about their discretionary spending.

As the UP retail economy navigates a period of economic uncertainty, retailers must adapt to changing consumer behaviors and prioritize cost-effective operations to remain competitive. The upcoming month of September will be crucial in determining the trajectory of consumer spending and the future of the Lucknow’s high street.