They say the first thing that someone notices about you is your feet and your footwear, so why not invest in the best pair of footwear that would enhance your personality to the very best. Footwear has evolved from being just a mere necessity as a protection for your feet to an important accessory that ups your fashion game right away. According to Businesswire, India is the second largest global producer of footwear after China, accounting for 9 percent of the annual global production of 22 billion pairs. Presently about 90 percent of the footwear produce in the country is consumed by the domestic market and the rest is exported. The growing Indian fashion and lifestyle market has given an impetus to the footwear industry as well.
Footwear industry in India is very optimistic right now with growing awareness about the latest trends and consciousness among consumers. Affirms Ishaan Sachdeva, Director, Alberto Torresi, “Be it men’s category or women’s, footwear have now become a necessary style statement for everyone. A lot of western influence can also be noticed these days where people are inclined towards styles like Oxfords taken from Europe and Brogues from Ireland.” This industry has seen a tremendous growth in the last few years. The demand for footwear products in India is increasing with each passing day. Harkirat Singh, Managing Director, Woodland, says, “Indian footwear industry is approximately between Rs.30,000 crores to Rs.40,000 crores. And this can grow up to 100 percent by next 5 years provided the right policies and tax structure. This market is shared between organized and unorganized segment. The organized segment caters to about one third of the market while unorganized players fetch the remaining 70- 75 percent market which essentially falls under micro, mini, small and medium enterprises.” With the rising disposable incomes of the customers, India’s domestic footwear market is booming. Rising incomes, advent of globalization, improved employment and living standards in the country has led to the expansion in the size of this market. Anupam Bansal, Executive Director, Liberty Group, agrees and says, “Also, consumer’s increased exposure to plastic money and imposition of GST is going to provide more organized retailing and trade transparency in long term. Government of India has already commenced the “Make in India” campaign which has been proving beneficial in boosting manufacturing in India. Secondly, due to the ever increasing internet penetration and adoption of internet and the overall ecosystem for e-commerce falling in place, the last decade has been the best for this industry.”
Evolving Shopping Behaviour
Instant awareness and aspirations for the latest global trends with the advent of technology has resulted in frequent shopping behaviour of consumers. According to Farah Malik, MD and CEO, Metro Shoes Ltd., demand for footwear is expected to remain strong over the forecast period. The category is anticipated to register a retail value CAGR of 7 percent at constant prices, with sales reaching Rs.778 billion in 2021. Farah Malik further elaborates, “The way consumers are spending their money on various items has changed in recent years. With the ever-increasing penetration of internet and social media, the purchasing behaviour of Indian consumers has changed dramatically. Urbanization is taking place in India at a dramatic pace and is influencing the life style and buying behaviour of the consumers. The factors that affect buying behaviour and draw customers to the shopping centers include space, ambiance and convenience and moreover an array of choice under one roof. The growth of integrated shopping malls, retail chains and multi-brand outlets is evidence of consumer behaviour being favourable to the growing organized segment of the business in the metros. Also, global fashion and lifestyle brands have suddenly started betting big on small cities of India.” Also, footwear now is an integral part of the outfit. It can make or break an outfit. The consumer in the present era is no longer the same simple, subtle and single- minded consumer he used to be a decade ago. Now, they prefer having a variety of footwear options. “The consumer has become more technological savvy, extensively prone to digital marketing and practices, fashion conscious, demanding the latest trends and contemporary styles and voguish in a certain manner. The growing footwear segment along with the rising brand consciousness, rising discretionary incomes which consequentially leads to higher propensity to buy along with rising fashion consciousness and increasing share of organized footwear market led to an enormous growth in footwear consumption,” maintains Anupam Bansal.
There has been a shift from being constraint to only a few types of footwear styles to a craze of owning different types of footwear for different occasions. Harkirat Singh feels, “Unlike earlier times when people used to own lesser number of shoes because they preferred wearing the same pair to office, to parties, for tea, etc., people today need different kinds of shoes for different occasions. For example, a fitness enthusiast would need running shoes for jogging or exercising, formal shoes for office, trendy and stylish shoes for parties and casual shoes for a casual outing, etc. Secondly, with trends changing very fast, brands are offering varied collections for varied seasons. So, when people visit shopping centers, they see a wide variety of footwear from different brands and that induces them to buy more. Furthermore, promotional offers, discounts, etc. also contribute in making their shopping more easy and convincing.” He further maintains that the advent of footwear retail in apparel stores, the later being a bigger sector, has lead to a massive growth in sales of footwear and thereby growth in this industry. While Ishaan Sachdeva asserts, “With an increased contribution in household income and change in spending patterns, the footwear sector is experiencing a great boom. Footwear is not just a part of wardrobe but has become a huge status symbol these days.”
Furthermore, talking about different categories in footwear, Farah Malik asserts, “At present, men’s category contributes around 60 percent of sales in the footwear segment as against women’s share of 30 percent. Men’s footwear market is growing at a CAGR of 10 percent. The women’s segment, however, is growing at a much faster CAGR of 20 per cent.”
Indian market, especially the footwear market, has a lot of scope. The Indian footwear industry is gearing up to leverage its strengths towards maximizing benefits. Resource strength of India in the form of materials and skilled manpower is a comparative advantage for the country, among other things. Ishaan Sachdeva says, “The increasing significance of footwear is leading to an upsurge in the demand of footwear day by day which is further leading to higher growth prospects of footwear industry. The easy availability of varied styles is also increasing brand loyalty amongst the customers. The advent of such huge varieties of footwear is growing the potential of footwear industry even in tier-II and tier-III cities as the people are becoming more and more brand centric in these cities as well.” As said many times, rural areas are where the real India lies. The organized sector has definitely realized that and is now moving towards the hinterlands of India. Anupam Bansal affirms, “India has a lot of potential in tier-II and tier-III cities and towns and therefore, Liberty is constantly entering these towns and tapping the potential market. Approximately two-third of the consumer market is dominated by the urban market and rest is located in the rural areas. It is something that needs to be worked upon.” Harkirat Singh from Woodland points that the Indian retail sector is set to grow substantially over the next few years, as the reach of organized retail would gradually spread to smaller towns and under penetrated areas. “Today consumers in tier-II and tier-III cities are aware about the domestic and international brands across categories. The market has evolved and there is a lot of potential. Currently, tier-II cities contribute a large percentage in the total sales; however, tier-III cities are catching up in terms of sales and are expected to grow exponentially by FY 2020,” he says. Furthermore, talking about online market share in the hinterlands of India, Farah Malik from Metro Shoes, apprises, “Mobile technology is revolutionizing the tier-II and tier-III markets and an online retailer must not ignore this segment. Women are the driving force in tier-II and tier-III online retail markets.”
Also, with a considerable rise in consumption of trendiest and most comfortable pair of footwear, consumers today do not mind paying higher for quality products as they now understand that ‘higher price definitely means better quality’. Harkirat Singh agrees, “India is a price sensitive market. But today consumers do not hesitate in paying more for quality, innovation and technology. We offer tech footwear which are water proof, anti- microbe shoes, non- skid shoes, etc. and people actually pay for these premium tech collections happily.” Apart from quality, people also look for good customer service which ultimately makes their store visit more satisfying. Farah Malik explains, “Customers remain loyal if the brand delivers on quality and a good customer service experience and are willing to pay extra for superior customer service. If you look at the millennials, they are the first generation who is willing consciously to spend more for better quality, for sustainability, for traceability. I think there is a change. Moreover, delivering excellent customer service experience along with consistent quality is imperative for any brand to retain customers.”
While the footwear industry is set for an exponential growth in the times to come, there are many challenges that are continuously erecting roadblocks in the process. “The industry is already working towards consolidating the growth. This has seen technology being the key element in making things possible to enhance growth. Many institutes have blossomed to provide retail professionals to the industry which will help in the long run. The government initiatives to taper down the real estate demands and make the pricing more pragmatic will also give a boost to the retail industry and push it to a higher growth path,” says Anupam Bansal. Talking about other challenges facing the industry right now, Farah Malik maintains, “The unorganised retail market is the most dominant and popular mode of retailing and purchase destination for the majority of India’s 1.3 billion population. Like food habits, footwear fashion changes every 100 kilometers. For example, the shortest heel preference in Chandigarh is the longest preferred in Kolkata. Hence, fashion footwear has always been dominated as well as successfully managed by local retailers. The unorganized footwear industry also enjoys the advantage of the passion and zeal of its business owners that is difficult to replicate across employees and store personnel. Also, footwear retailing primarily involves touching the feet of our customers as part of service and hence the front end does not attract the best manpower in terms of education, technical expertise and sophistication.” Apart from these, Harkirat Singh point out that product counterfeiting is another big challenge for the organized footwear industry. “Organised sector is something we cannot avoid because it’s the bigger chunk of the market. But the real problem lies in stopping the counterfeit products; its easy to sell fake shoes for the unorganized retailers but that ultimately hampers the brand image as consumers start associating the quality and performance of a fake product to the brand. We try to curtail that through legal processes where we conduct raids, seize counterfeits and apply to some suit in the court, etc. But that still possess as a big challenge for us, especially in a country like India where we don’t have too many laws against counterfeit, he asserts.
In-Trend And Forthcoming
Footwear trends as such are difficult to forecast as they tend to change frequently with every season. Furthermore, its also true that in fashion, trends have their way of repeating themselves over time and footwear sue is no exception. According to Ishaan Sachdeva, “A drastic shift has been witnessed from the mainstream lace-ups and slip-ons to styles such as monk straps, oxfords, brogues and tassels. Then plimsolls that are inspired by the British culture are another shoe style that have gained massive acceptance in the recent times. Not just by the younger generation but plimsolls are preferred by celebrities as well. Talking about the women footwear trends, boots are always preferred by them. Women are investing in stylish ankle and desert boots. Boots with block heels are also quite in vogue these days. Another shoe style, sneakers makes an ideal choice for daily wear.” In the past, comfort was the most important factor during the selection of footwear. However, with the advent of media and increased global travel, Indians have become style conscious. “Fashion footwear with comfort is now the trend in the market. Consumers have also started shopping for shoes that compliment and accentuate their clothes,” maintains Farah Malik.
According to Singh from Woodland, trends keep changing because every season now has new colours, features, etc. coming up and Woodland brings in trends from its fashion houses in Italy and Hongkong. For the forthcoming season, “Woodland is coming up with technology driven footwear and apparels”. While Alberto Torresi is soon launching its new collection which is a “sweet hybrid of Italian and Indian footwear”, Liberty’s Autumn/Winter collection is going to transform the idea of being elegant and sensational without compromising on comfort. Meanwhile, Metro Shoes have launched its new evening and bridal shoe collection.
The Way Forward
Going forward, with expansion in retail sector and technological advancements, footwear market is amongst the fastest emerging sectors in the fashion industry. According to Ishaan Sachdeva, “The demand for footwear products in India is to expand in the coming years as the customers do not compromise both with comfort and style.” Farah Malik further asserts, “I believe the footwear industry has been recognised by the Government of India as a focus sector in the ‘Make in India’ mission whether we do it for India or we do it for the world. The challenge for Indian footwear industry is lit large but anticipating India to become amongst top 5 superpowers by 2030, our consumption rates can reach as high as 7-8 pairs. In such a scenario, India would need to produce anywhere between 8-10 billion pairs considering yearly population growth. With global integration of Indian industry, rapid change in lifestyle, income growth at bottom of the wealth pyramid, footwear industry is expected to grow by leaps and bounds. For the Indian footwear to explode and deliver, favourable government policies, infrastructure, removal of high doses of taxation, infrastructural support in capacity building, skill education and technology up gradation, brand building exercise should be initiated expeditiously no later than now.”
Perpule, an Omni-channel retail-tech company and announced the launch of its next-gen Point of Sale (POS) billing solution called UltraPOS. Perpule’s UltraPOS is a platform independent, form factor independent POS billing system which can enable anytime, anywhere billing. It is a cloud-based SaaS product which eliminates the need of bulky servers and computers in the store. UltraPOS will enable offline stores to reduce billing counter size by up to 40% and help increase sales and revenue through an AI/data-driven approach to dynamic offers, cross-sell and upsell. It is currently being used by retail brands such as Vishal Mega Mart, Big Bazaar, Foodhall and many more.
Perpule UltraPOS can render traditional billing systems obsolete with in-built features such as analytics, inventory and staff management tools. Retailers can update product prices, stocks, offers, etc. consistently across platforms. The cloud-based solution seamlessly operates in online as well as offline modes which is perfect for India where connectivity is still a challenge. This solution also gives omni-channel players a platform to manage order and inventory for both e-commerce as well in-store sales from the store itself. The UltraPOS solution can work with any device such as handhelds, mobile, desktop and tablets. It allows cashiers to scan barcodes, generate receipts and accept payments without any hassle. Retailers can also opt for the accompanying hardware (a handheld device) at no additional cost and a flexible monthly rental fee. Retailers can also opt UltraPOS for their existing infrastructure or try out a combination of both handheld and traditional billing modules.
A major challenge for retailers is the lack of display area and suboptimal customer flow. UltraPOS tackles this by reducing the size of billing counters, allowing for more space to showcase merchandise and increase footfall. Due to the mobile nature of the device, users can save significantly on IT capex, opex and manpower costs. Retailers will be able to get more than 50% reduction in POS technology spend (eg. store server, computer, printer, scanner, EDC/payment, networking, etc) and 95% reduction in paper saved from digital receipts. Perpule also provides value-added services for retailers to increase revenue such as bill payments, recharges and ticket bookings.
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