New Delhi: Inflation has been slowing down start-up businesses and it is expected that consumer demand will stay low over the coming quarter.

Consumer perception of the general economic condition continues to be pessimistic as per the Reserve Bank of India’s Consumer Confidence Survey of January 2023, where more than 50% of consumers reported it to have worsened.

According to market research firm Redseer Strategy Consultants, there is an ongoing risk of further and escalation in the war on Ukraine and the current wheat crop being impacted by hot weather conditions.

The Bharat-focused startups, too, need to look at revamping their SKU ( stock keeping unit) strategy to fit the tighter wallets of the mass-market consumers. The second strategy is to double down on the premium categories, which have lower price elasticity and have performed well against market pressures across sectors,” the findings showed.

In 2022, global inflationary pressures severely impacted consumer demand. The revenue increase was driven by higher prices, as volumes remained low across the urban and rural sectors.

The report said that with the macroenvironment challenges expected to continue, consumer demand is likely to remain subdued for the foreseeable future.

It added that they expected consumer demand over the near future to continue staying subdued, with high inflation, unemployment in the urban organised sector and falling real wages in the rural areas.

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