Big spenders too feeling the pinch

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It’s not just the Indian middle class that is having sleepless nights due to a stratospheric rise in the price of food and basic commodities. Inflation has gripped the consumers of high-end products too. In a first-of-its-kind inflation measure for the HNWIs (High Net Worth Individuals), a study has found that prices of high-end lifestyle products (which includes 20 lifestyle products and services, such as wine, accessories, cigar and club membership) have risen by 11.7 per cent in Asia-Pacific region, including India, in the past one year.
Generally, one would think that spending 10 per cent more on a product worth lakhs wouldn’t dent deep pockets, but that isn’t the case. Designer Ashima Singh of the label Ashii has started spending cautiously, even for her collections. “Earlier, I used to buy loads of fabric and other things just for experimentation. Now, I have cut down on all that. I try to buy things that I know I would be needing in the final designs,” she says.
While Ashima is thinking in terms of business, even buyers have started feeling the pinch. Socialite and theatre actor Bubbles Sabharwal says her entire family has become a “wise spender” since the last few months. When it comes to high-end shopping, they spend only on things that they are really crazy about. “Double-digit inflation surely affects everyone as the income growth is not in sync with the rising prices,” she says. Aware of the fact that luxury items are available in the developed countries at a much lesser price, Bubbles tries to shop for luxury products abroad.
Model Amanpreet Wahi says she waits for her half-yearly vacations to London or New York for the same reason. “Rather than spending more than double the amount on luxury products in India, I prefer to shop abroad,” says Amanpreet, who is a self-confessed “wise” shopaholic.
However, there are some who think that spending a little extra wouldn’t really make a difference to the ones who are already paying an exorbitant amount. Socialite Tanisha Mohan says, “If you are spending lakhs on a product, you wouldn’t really mind spending `10,000 extra. But yes, there’s a considerable impact. Either one buys less items or the frequency of spending has decreased,” she says.
Staying practical is the key for interior designer Navin Ansal, who owns a luxury décor label. Until now, he says, the effect of inflation has not been much on high-end products. “It’s too early to pass a verdict. But if prices continue to rise, then the luxury segment will surely be affected,” he says.
Cigar baron Manish Datt agrees and says that people have started thinking twice before buying anything and everything but the luxury market hasn’t really witnessed a loss. “In fact, even in the time of inflation, there has been a 27 percent growth in the Indian cigar market,” says Manish.