Harkirat Singh, Managing Director, Woodland, talks to Indiaretailing about the challenges and growth prospects of the Indian footwear industry.
Q. What is the size of the Indian footwear market?
Indian footwear market is estimated at about Rs 19,900 crore with a growth rate of 8 to 10 percent. It has substantially grown and matured rigorously. The domestic footwear market is comprised of casual, formal, semi-formal, and sports shoes along with sandals for men and women. At present, men’s segment dominates the category with 59 percent of the market share, whereas women’s segment contributes 41 percent. Furthermore, kid’s footwear segment is one of the fastest escalating segments in India.
Q. What is the share of men’s and women’s segment in your total sales in India?
Our footwear caters to the adventure enthusiasts across the globe. Around 80 percent of our customers would be male and 20 percent female. At present, men’s segment dominates the category with 59 percent of the market share, whereas women’s segment contributes 41 percent. Furthermore, kid’s footwear segment is one of the fastest escalating segments in India.
Q. What is your targeted turnover for this fiscal?
We cannot disclose a specific figure, but we have been growing at a steady rate of 20 to 25 percent.
Q. What is the share of exclusive-brand and multi-brand outlets in the Indian footwear market?
The share of multi-brand outlets in Indian footwear market is 28 percent whereas exclusive-brand outlets hold 50 percent of the market.
Q. What is the average spending on footwear by Indian consumers?
Indian consumers are slowly coming out of their frugal mindsets due to an increment in their disposable income. Brisk growth and expanding urbanization have given birth to a new category of consumers with more money to spend. The propensity of Indian consumers is inclining more towards branded footwear due to a swing in their buying habits. People are becoming more fashion conscious and wish to buy tasteful and stylish branded products now.
Q. What are your views on organized vs. unorganized footwear retail in India?
Men’s footwear segment is comprehensively more organized than women and kids’ segments in the country. The principal reason for this is the complex buying behavior of Indian women.
Q. High-street markets or malls, which out of the two is more suitable for footwear retailing?
At Woodland, we don’t ignore the high-street market as it is more proficient for “youth” targeted products. The Woodland stores are very accessible and products are available globally with its over 300 exclusive stores. Indian footwear retailers are discerning that while malls offer higher footfalls, high-street markets have several benefits. The cost of maintaining a high-street market is 40 percent lesser than a mall outlet which comes with the overhead costs of parking, energy, etc. High-street market has enormous potential for footwear retailers as it can endow them with more opportunities.
Q. What are your expansions plans?
Woodland has currently allocated Rs 50-60 crore on product development and technology enrichment for its manufacturing facilities. Woodland currently has 300 plus company-owned, company-operated stores and has presence through 3,000 plus multi-brand outlets globally. As a rule, we always go slow in our expansion, our focus has always been customer satisfaction rather than expansion.
The company is looking at opening 60 to 70 large-format stores of an average size of 4,000 sq.ft. by the end of this financial year. We have already done a soft launch of our e-commerce store which is currently under test run and we willl soon have our e- commerce store in place.
Q. Are your expansion plans targeted at metro cities only?
We are not only focused on metros but also present in Tier II and III cities like Saharanpur, Patiala, Kota, Lucknow, Nagpur, Goa, Bilaspur, Ujjain, Bhopal, Surat and Baroda. Around 40 percent of our stores are in Tier II cities and 60 percent are in metros. Soon, this ratio will be 50:50.
Q. What are the challenges the Indian footwear market is facing?
The biggest challenge today is high-quality product manufacturing facilities. With the increasing demand of quality fashionable footwear, a facility for making such footwear needs to be enhanced proportionately. Also, the scarcity of skilled labor for manufacturing the perfect footwear is another challenge.
The major challenge at present would be "counterfeits." All big brands today are facing problems with counterfeits, which are growing in smaller units.
Q. What are the emerging trends in the Indian footwear market?
The emerging trends in the Indian footwear market are eco-friendly initiatives and e-commerce. We have always been an outdoor brand and very much in tune with nature. Whatever we do, it will never be against the environment but rather in consonance with it. Following the same direction, we have recently launched biodegradable shoes. The product was developed after extensive research and is made of crepe rubber (natural raw rubber), vegetable tanned leather and cellulose.
