Karachi’s traders have expressed deep dissatisfaction with the sales performance during the Eid ul Fitr season of 2025. Although markets were bustling with customers, the sales figures fell far short of expectations. Despite a significant surge in available goods, the overall sales this year were notably lower compared to previous years, with traders reporting a decline of 25 to 30 percent in sales volume. This year, only around Rs. 15 billion worth of goods were sold, a stark contrast to the Rs. 70 billion recorded in 2015, which was considered a peak year for Eid sales in the city.
Low Purchasing Power Impacting Consumer Spending
The All Karachi Traders Union, led by President Atiq Mir, attributed the disappointing sales to the severe economic conditions that have affected consumer purchasing power. Mir emphasized that despite a 40 to 50 percent increase in the availability of goods during Eid ul Fitr 2025, low income levels among the population led to reduced spending on non-essential items such as ready-made garments, shoes, artificial jewelry, and affordable decorative goods.
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The downturn in sales this year is indicative of the broader economic crisis in the country, with inflation rates soaring and many people unable to indulge in the customary Eid shopping sprees. While shopping this Eid was limited to basic items such as ready-made garments for women and children, low-cost accessories like toys, hosiery, and cheap purses saw a spike in sales, reflecting the constrained spending power of the general public.
Decade-Long Decline in Eid Sales
The situation has worsened over the past decade, with Karachi’s Eid sales steadily declining from Rs. 70 billion in 2015 to just Rs. 15 billion in 2025. Atiq Mir lamented that the city’s retail sector has seen its sales potential dwindle, pointing out that Karachi had the capacity to generate up to Rs. 100 billion in Eid sales before the economic downturn hit. The current figures, he noted, reflect the negative impact of inflation, economic instability, and other external challenges that have affected the purchasing behavior of the city’s residents.
Impact of Inflation and Borrowed Inventory
The sluggish sales have been especially hard on shopkeepers who had invested heavily in goods in anticipation of a profitable Eid season. According to Mir, around 40,000 shopkeepers across more than 200 markets in Karachi had stocked up with approximately Rs. 40 billion worth of merchandise. However, only Rs. 15 billion in sales were achieved, leaving a substantial portion of the inventory unsold and stored in warehouses. This has left many traders struggling to repay borrowed capital used to finance their stock, further exacerbating the financial difficulties they are facing.
Struggle for Survival Amidst Economic Crisis
The economic crisis has particularly affected the lower and middle classes in Karachi, who, despite the festive season, were unable to afford luxury items and had to limit their shopping to only the most essential goods. The situation has created a challenging environment for businesses, particularly in the retail sector, where traders are now finding it increasingly difficult to meet both their operational expenses and personal financial commitments.
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In response to the ongoing economic struggles, the government is attempting to ease the burden on businesses. Prime Minister Shehbaz Sharif is set to meet with top business leaders to discuss potential reforms, including a reduction in electricity tariffs. The government, in collaboration with the International Monetary Fund (IMF), has also sought to lower electricity prices, which could provide some relief to the business community grappling with rising operational costs.