Chattogram ice cream business in pandemic shock

Established in 1989, Chattogram-based Panda Ice Cream closed its business in 2006. After remaining closed for 14 years, the brand resumed its business operations in March – with a capital of Tk120 crore. The manufacturer also launched its distribution network stretching from southeastern Teknaf to Feni.

It also rented a mega outlet at the Chattogram International Trade Fair in March centring the relaunch.

However, Panda Ice Cream faced closure for a second time on the eighth day of reopening when the Covid-19 pandemic shutdown began. Now that business activities have resumed, the manufacturers are concerned over their survival with the recurring losses.

Other ice cream brands in Chattogram are also facing the same future as they missed the peak sales season and people are still avoiding chilled products to avoid the risk of catching a cold.

Against the backdrop of the crisis, the port city-based ice cream makers have demanded a government stimulus package to salvage the sector.

Industry people said ice cream is a seasonal product in Bangladesh, and the peak sales period of this summer favourite frosty dessert is from March to October. Demand for ice cream decreases in November-February – during winter.

This time around, the ongoing pandemic has ruined the entire business of the item, putting the growing industry in a tight corner.

After the Covid-19 outbreak, rumours did the rounds on social media that the virus spreads through ice cream and other chilled products. This slashed ice cream consumption globally.

Sales of ice cream also started declining in Bangladesh in March after the maiden Covid-19 cases were detected. During the 66-day-long general holidays from the last week of March to May, schools, colleges, universities, offices, shopping malls and entertainment centres were shuttered. People were discouraged from coming out of their homes and movement restrictions ruined ice cream sales in the port city during the peak sales season.

Manufacturers said students are their main retail customers. Although offices and businesses started reopening gradually from June, the educational institutions are still closed with no specific reopening date anytime soon.

This also means no quick recovery from virus fallout for the ice cream makers.

We are incurring losses of nearly Tk70 lakh per month, said Md Zahidul Hasan, assistant manager, HR & Admin of Panda Ice Cream.

"Our sales are amounting to only Tk40 lakh per month while we were supposed to have a monthly business of Tk1.5 crore," he told The Business Standard. 

He said ice cream sales are not rebounding though one month-and-a-half has passed since the reopening. The chilled product brand alone lost 70% of its business.

"It is almost certain that the business will not normalise before March next year–even if the virus situation improves," he added.

Sanowara Group's sales of Quality Ice Cream is worth Tk300 crore annually. The company's Deputy General Manager (Finance and Accounts) Saiful Islam said they have already lost Tk150 crore business during the shutdown.    

"Our current sales barely reach 10% [of what they used to]. Students were the main customers for the ice cream products. The ice cream business is still dull as educational institutions are closed," said Saiful.

He added that Sanowara Group is paying its 800 workers countrywide only 20-50% of their salaries due to a funding crisis. 

The ice cream maker noted that they have sought government stimulus to offset the losses on their own is "very difficult."

Meanwhile, sales of ice cream have also declined in various cooling corners and snacks stores as the educational institutions are still closed.  

Sohel Books and Stationery at Agrabad CDA Residential Area in the port city used to sell Tk2,000's-worth of ice cream per day – which has declined to Tk400-500.

"The fear-induced parents no-longer buy ice cream for their kids," said owner of the shop Ataullah Sohel.

A private firm official Shahadat Hossain said he used to buy ice cream for his children. But he is now avoiding chilled products so that the kids do not develop flu or fever-like symptoms.

"For me, health safety comes first during this pandemic," he said.       

Meanwhile, though the number of shoppers has increased at Chattogram shopping malls, ice cream parlours still remain deserted.

Sub Zero Ice Cream outlet at MA Aziz Stadium in Chattogram used to sell Tk10,000's-worth of ice cream a day before the pandemic situation.

The outlet Manager Mamunur Rashid said though they reopened on August 1, their daily sales still hover around Tk1,500-2,000.

"People are still afraid of infection," he said, adding they are incurring a Tk3 lakh loss per month.   

Mamunur Rashid said, "The situation at other ice cream outlets in the city is almost the same. I do not think the sales will bounce back this year."