MUMBAI/BEIJING (BLOOMBERG) – Down the street from Mumbai’s grand colonial-era Royal Opera House, Deepak Gurnaney sits in his small electronics shop in front of rows of flat screen TVs flashing Hindi-soap operas, while his four staff play with their phones. There are no customers.
The 68-year-old used to need a machine to count the cash brought in by the business his father founded, and a warehouse nearby to keep enough stock. With business down 25 per cent the past two years, he’s got rid of both.
“The car market is down, this market is down, that market is down, so people see that and think they should not spend,” he says. “Retail trade being the way it is, I cannot encourage anyone in my family to join this business. I will be the last generation.”
Nearly 3,000 miles away, in the fluorescent lighted sprawl of Beijing’s Zhongguancun Kemao electronics mall, He Hongyuan is singing a similar tune.
“These days consumers tend to be more careful with their spending,” He says from behind the counter of his glass booth, one of hundreds in the mall selling phones, laptops and other gadgets. “In the past, people changed phones as soon as the new model came out. Now they change their phones according to their need.” He said profits have fallen by half in the past two months.
Gurnaney and He are emblematic of the deepening retail gloom in India and China, home to 2.8 billion people, or more than a third of the world’s consumers. Makers of everything from cars to shampoo had pinned their hopes for growth on one or both of these Asian giants, and the effects of the double slowdown are rippling out across the world.