Mumbai: Consumers appear to be cutting back on discretionary spending, allocating more budget towards essential items and value shopping as a mix of war-induced uncertainty and layoffs has led people to tighten their purse strings and save more. Even though the US and Iran agreed to a two-week ceasefire last week, prospects for a peace deal remained bleak as talks held in Pakistan between the two countries failed to yield the desired results. Analysts said caution would be exercised until there is clarity on complete de-escalation. “After mid-March, discretionary offtake slowed down,” said Satyaki Ghosh, CEO, Raymond Lifestyle, pinning his hopes on the upcoming wedding season to support demand. “We are running some value-based offers but no direct discounts yet,” Ghosh said. Tarun Arora, CEO and whole-time director, Zydus Wellness, maker of brands like Complan and Glucon-D, said consumers are not only curbing overall spend at stores, but are also looking towards affordable options and value-driven choices, prioritizing essentials over luxuries, considering smaller and more accessible formats where relevant. Shankar Prasad, CEO of D2C beauty brand Plum, said people are not necessarily doing less business, although there has been some reduction in spending due to simpler routines and less impulse buying. “What we are seeing is a gradual shift in consumer preference towards essential categories, with relatively higher spend on everyday need-based products, while discretionary and indulgent purchases have softened a bit, which usually happens during periods of uncertainty,” said Mayank Shah, chief marketing officer, Parle Products. Shah said, for now, the company is focusing on pushing the value pack of premium products so that even casual purchases remain accessible. The war-induced surge in crude oil has already raised costs, with companies pointing to inflationary pressures and looking to impose price increases. Many companies in sectors like edible oils, bottled water, beverages and consumer durables have already increased prices slightly, putting pressure on middle-class families. Nuwama analysts expect inflation to rise across the country after the elections. “Footwear players may face margin pressure as about 30% of their raw material output is linked to input raw materials. QSRs may also experience cost reductions from increased energy, packaging and secondary input expenses,” he said in a recent note. Along with rising prices, the job market may also see a slowdown as some companies put hiring on hold amid uncertainty, while AI-led tech layoffs are troubling the salaried class. For example, Unilever halted global hiring for three months because of the war.