Indian Footwear Industry Overview

Indian leather industry is the core strength of the Indian footwear industry. It is the

engine of growth for the entire Indian leather industry and India is the second largest

global producer of footwear after China.

Reputed global brands like Florsheim, Nunn Bush, Stacy Adams, Gabor, Clarks, Nike,

Reebok, Ecco, Deichmann, Elefanten, St Michaels, Hasley, Salamander and Colehaan

are manufactured under license in India. Besides, many global retail chains seeking

quality products at competitive prices are actively sourcing footwear from India.

While leather shoes and uppers are produced in medium to large-scale units, the

sandals and chappals are produced in the household and cottage sector. The industry

is poised for adopting the modern and state-of-the-art technology to suit the exacting

international requirements and standards. India produces more of gent’s footwear while

the world’s major production is in ladies footwear. In the case of chapels and sandals,

use of non-leather material is prevalent in the domestic market.

Leather footwear exported from India are dress shoes, casuals, moccasins, sport

shoes, horrachies, sandals, ballerinas, boots. Non-leather footwear exported from India

are Shoes, Sandals and Chappals made of rubber, plastic, P.V.C. and other materials.

With changing lifestyles and increasing affluence, domestic demand for footwear is

projected to grow at a faster rate than has been seen. There are already many new

domestic brands of footwear and many foreign brands such as Nike, Adidas, Puma,

Reebok, Florsheim, Rockport, etc. have also been able to enter the market.

The footwear sector has matured from the level of manual footwear manufacturing

methods to automated footwear manufacturing systems. Many units are equipped with

In-house Design Studios incorporating state-of-the-art CAD systems having 3D Shoe

Design packages that are intuitive and easy to use. Many Indian footwear factories have

also acquired the ISO 9000, ISO 14000 as well as the SA 8000 certifications. Excellent

facilities for Physical and Chemical testing exist with the laboratories having tie-ups with

leading international agencies like SATRA, UK and PFI, Germany.

One of the major factors for success in niche international fashion markets is the ability

to cater them with the latest designs, and in accordance with the latest trends. India,

has gained international prominence in the area of Colours & Leather Texture

forecasting through its outstanding success in MODEUROP. Design and Retail

information is regularly made available to footwear manufacturers to help them suitably

address the season's requirement.

The Indian Footwear Industry is gearing up to leverage its strengths towards maximizing

benefits.

Strength of India in the footwear sector originates from its command on reliable supply

of resources in the form of raw hides and skins, quality finished leather, large installed

capacities for production of finished leather & footwear, large human capital with

expertise and technology base, skilled manpower and relatively low cost labor, proven

strength to produce footwear for global brand leaders and acquired technology

competence, particularly for mid and high priced footwear segments. Resource strength

of India in the form of materials and skilled manpower is a comparative advantage for

the country.

The export targets from 2007-08 to 2010-11 as tabulated below reflects the fact that

footwear sector is the most significant segment of the Leather Industry in India.

The export targets from 2007-08 to 2010-11

(In Million US$)

Product 2006-07 2007-08 2008-09 2009-10 2010-11

Actual Export

Leather 688.05 726.85 785.00 847.80 915.63

Footwear 1212.25 1967.88 2597.60 3428.83 4526.05

Garments 308.98 358.53 372.87 387.78 403.30

Leather Goods 690.66 733.34 798.69 870.06 948.04

Saddlery &

Harness

81.85 105.66 127.85 154.70 187.19

Total 2981.79 3892.26 4682.01 5689.17 6980.21

 

India has emerged in recent years as a relatively sophisticated low to medium

cost supplier to world markets –The leather industry in India has been targeted

by the Central Government as an engine for economic growth. Progressively, the

Government has prodded and legislated a reluctant industry to modernise. India was

noted as a supplier of rawhides and skins semi processed leather and some shoes.

In the 1970’s, the Government initially banned the export of raw hides and skins,

followed this by limiting, then stopping the export of semi processed leather and

encouraging local tanneries to manufacture finished leather themselves. Despite

protestations from the industrialists, this has resulted in a marked improvement in

the shoe manufacturing industry. India is now a major supplier of leather footwear

to world markets and has the potential to rival China in the future (60% of Chinese

exports are synthetic shoes).

India is often referred to as the sleeping giant in footwear terms. It has an installed

capacity of 1,800 million pairs, second only to China. The bulk of production is

in men’s leather shoes and leather uppers for both men and ladies. It has over 100 fully

mechanised, modern shoe making plants, as good as anywhere in the world (including

Europe). It makes for some upmarket brands including Florsheim (US), Lloyd

(Germany), Clarks (UK), Marks and Spencer (UK).

India has had mixed fortunes in its recent export performance. In 2000, exports of

shoes were US$ 651 million, in 2001 these increased to 663 million but declined

in 2002 to 623 million dollars (See Statistics).

The main markets for Indian leather shoes are UK and USA, which between them

take about 55% of total exports.

India has not yet reached its full potential in terms of a world supplier. This is due

mainly to local cow leather that although plentiful, has a maximum thickness of 1.4

– 1.6mm, and the socio / political / infrastructure of the country. However, India

is an excellent supplier of leather uppers. Importation of uppers from India does not

infringe FTA with Europe or the USA.

The potential is set to change albeit slowly, but with a population rivalling China for

size, there is no doubt the tussle for world domination in footwear supply is

between these two countries.

Few Interesting Facts:

- The Indian footwear retail market is expected to grow at a CAGR of over 20% for the

period spanning from 2008 to 2011.

- Footwear is expected to comprise about 60% of the total leather exports by 2011 from

over 38% in 2006-07.

- Presently, the Indian footwear market is dominated by Men's footwear market that

accounts for nearly 58% of the total Indian footwear retail market.

- By products, the Indian footwear market is dominated by casual footwear market that

makes up for nearly two-third of the total footwear retail market.

- As footwear retailing in India remain focused on men's shoes, there exists a plethora

of opportunities in the exclusive ladies' and kids' footwear segment with no organized

retailing chain having a national presence in either of these categories.

- The Indian footwear market scores over other footwear markets as it gives benefits

like low cost of production, abundant raw material, and has huge consumption market.

- The footwear component industry also has enormous opportunity for growth to cater to

increasing production of footwear of various types, both for export and domestic market.

In a Nutshell:

There are nearly 4000 units engaged in manufacturing footwear in India. The industry is

dominated by small scale units with the total production of 55%. The total turnover of

the footwear industry including leather and non-leather footwear is estimated at

Rs.8500-9500 crore (Euro 551.3-1723.1 Million) including Rs.1200-1400 crore (Euro

217.6-253.9 Million) in the household segment.

India's share in global leather footwear imports is around 1.4% Major Competitors in the

export market for leather footwear are China (14%), Spain (6%) and Italy (21%).

The footwear industry exist both in the traditional and modern sector. While the

traditional sector is spread throughout the country with pockets of concentration catering

largely to the domestic market, the modern sector is largely confined to select centres

like Chennai, Ambur, Ranipet, Agra, Kanpur and Delhi with most of their production for

export.

Assembly line production is organized, and about 90% of the workforces in the

mechanized sector in South India consist of women. In fact, this sector has opened up

plenty of employment opportunities for women who have no previous experience. They

are trained to perform a particular function in the factory itself

Indian Footwear Industry – A Status

The footwear sector is a very significant segment of the leather industry in India; rather

it is the engine of growth for the entire Indian leather industry.

 

India is the second largest global producer of footwear after China, accounting for 13%

of global footwear production of 16 billion pairs. India produces 2065 million pairs of

different categories of footwear (leather footwear - 909 million pairs, leather shoe

uppers - 100 million pairs and non-leather footwear - 1056 million pairs). India exports

about 115 million pairs. Thus, nearly 95% of its production goes to meet its own

domestic demand.

 

The major production centers in India are Chennai, Ranipet, Ambur in Tamil Nadu,

Mumbai in Maharastra, Kanpur in U.P., Jalandhar in Punjab, Agra, Delhi, Karnal,

Ludhiana, Sonepat, Faridabad, Pune, Kolkata, Calicut and Ernakulam. About 1.10

million are engaged in the footwear manufacturing industry.

.

Footwear exported from India are Dress Shoes, Casuals, Moccasins, Sport Shoes,

Horrachies, Sandals, Ballerinas, Boots, Sandals and Chappals made of rubber, plastic,

P.V.C. and other materials.

 

Brands sourced from India:

Footwear

Acme, Ann Taylor, Bally, Charter Club, Clarks, Coach, Colehann, Daniel Hector,

Deichmann, DKNY, DoubleH, Ecco, Elefanten, Etienneaigner, Florsheim, Gabor,

Geoffrey Beene, Guess, Harrods, Hasley, Hush Puppies, Kenneth Cole, Liz Claiborne,

Marks &Spencer, Nautica, Next, Nike, Cole Haan, Nunn Bush, Pierre Cardin, Reebok,

Rockport, Salamander, StacyAdams, Tommy Hilfiger, Tony Lama, Versace, Yves St.

Laurent, Zara, Johnston & Murphy, Docksteps,Timberland, Armani, Geox, Diesel, Ted

Baker, Lacoste, Kickers, Calvin Klein, Sioux, Brasher, Zegna, Massimu Dutti, Buggatti,

Lloyd, Christian Dier, Salamander, Camper, Bata, Espirit, French Connection, Legero,

Mercedez, H & M and many more famous brands

Besides, major brands are sourced from India, MNC brands are sold in India and

Indian brands sold in India.

MNC Brands Sold in India Indian Brands sold in India

Aldo, Bally, Clarks, Ecco, Florshiem,

Ferragammo, Hush Puppies, Lee

cooper, Lloyd, Marks & Spencer, Nike,

Nine West, New Balance, Reebok,

Rockport, Stacy Adams

Red Tape, Bata, Liberty, Khadims,

Lakhani, Metro, Action

 

US Retail giant Wal-Mart has also begun sourcing footwear from India since the last two

years.

 

The Footwear sector is now de-licensed and de-reserved, paving the way for expansion

of capacities on modern lines with state-of-the-art machinery. To further assist this

process, the Government has permitted 100% Foreign Direct Investment through the

automatic route for the footwear sector.

 

Conducive Investment climate towards attracting overseas investments and increasing

cost competitiveness.

 

The Government of India is setting up dedicated Footwear Complex and Footwear

Components Part where footwear clusters are located.

 

There has been active interest in collaborating with Indian Footwear companies from

European countries like Italy, Spain and Portugal.

 

Footwear Imports Global Trend:

Major Importing Countries of Footwear (Leather and Non-Leather)

    (Value in Million US$)    

Country 2004 2005 2006 2007 2008 2009

USA

17071.

97

18548.

37

19835.

93

20039.

13

20104.

41

17904.

13

Germany

4691.1

4

5238.9

7

5591.7

7

5966.9

9

6529.3

3

6037.7

3

France

4199.8

5

4500.2

2

4778.0

7

5473.0

4

5714.0

0

5379.7

8

UK

4492.0

2

4694.9

4

4950.4

9

5281.5

5

5213.0

0

4772.5

9

Hong Kong

4674.1

7

5098.2

4

4984.5

9

4881.6

7

4944.4

0

3974.3

0

Italy

3209.9

8

3621.0

6

4047.3

7

4529.7

7

4810.2

5

4457.8

8

Japan

2998.8

5

3300.2

8

3509.8

3

3750.0

4

4112.9

9

4077.5

8

Spain

1431.7

5

1734.2

4

2036.2

1

2388.7

4

2917.9

7

2464.3

4

Belgium

1804.0

3

1993.7

7

2057.3

9

2543.0

4

2892.6

2

2554.5

0

Russia 284.37 543.12

1121.6

8

2067.8

2

2843.8

1

2149.4

2

Netherlands

1459.1

0

1772.2

2

1978.3

3

2297.9

5

2570.8

6

2481.3

5

Canada

1183.9

1

1321.9

9

1507.2

1

1674.0

4

1747.9

4

1645.2

0

         

Major Exporting Countries of Footwear (Leather and Non-Leather)

    (Value in Million US$)    

Country 2004 2005 2006 2007 2008 2009

China

14626.

36

18433.

69

21014.

63

24181.

69

28115.

96

26571.

20

Italy

7791.3

1

7652.9

3

8246.5

1

9712.9

4

10218.

75

8142.9

2

Hong Kong 5374.0 5828.4 5692.8 5639.6 5666.0 4502.4

4 0 5 4 5 9

Vietnam

2691.8

3

3039.1

7

3595.9

4

3999.4

8

4769.8

7 NA

Belgium

1929.2

2

2509.3

4

2960.2

8

3375.6

3

3680.8

0

3464.1

0

Germany

2022.6

1

2316.3

0

2607.8

9

2999.1

9

3611.9

0

3194.6

9

Spain

2175.3

5

2041.3

7

2147.7

4

2440.4

7

2670.3

5

42487.

12

Netherlands

1328.9

5

1493.6

1

1577.0

3

1811.9

6

2240.7

0

2235.8

0

France

1325.7

8

1376.5

2

1535.2

1

1840.5

1

2015.1

3

1800.7

0

Brazil

1814.0

1

1891.5

5

1863.1

1

1911.7

4

1881.3

0

1359.9

8

Indonesia

1247.2

3

1348.4

6

1514.6

3

1567.0

5

1828.4

4

1688.3

5

Portugal

1562.5

9

1413.7

1

1465.1

1

1695.8

8

1797.0

0

1552.7

4

Romania

1061.8

3

1175.7

0

1272.9

7

1394.3

2

1350.7

8

1054.9

3

         

Footwear – Global Scenario and India’s share

 

The global import of Footwear (both made of leather as well as non-leather) increased

from US$ 67.15 billion in 2005 to US$ 77.36 billion in 2009, growing at a CAGR of

3.60%. During 2009, the India’s share in the global import is 1.95%.  

 

        (In Million US$)

  2005 2006 2007 2008 2009

Global import of

Footwear

67151.8

6

73086.4

3

80943.6

1

87839.6

8

77360.6

0

India's export of

Footwear

& Footwear Components 1045.24 1236.91 1489.35 1534.32 1507.51

% Share of India 1.56% 1.70% 1.84% 1.75% 1.95%

 

Source: ITC, Geneva & DGCI &S, Kolkata

Global Footwear import includes leather & non-leather

India’s Footwear includes – Leather, non-leather and uppers

 

Footwear is the engine of growth of the leather industry in India. India’s export of

Footwear touched US$ 1732.04 million in 2010-11, accounting for a share of 45.05% in

India’s total export from the leather sector of US$ 3844.86 mn.

 

India’s Footwear export (leather, uppers & non-leather) is growing at a CAGR of 8.78%

in the last five years ending 2010-11 

India’s export of leather footwear had increased from US$ 974.33 million in 2006-

07 to US$ 1460.42 million in 2010-11.

India’s export of footwear components had increased from US$ 219.84 million in

2006-07 to US$ 215.03 million in 2010-11

India’s export of non-leather footwear has increased from US$ 42.74 million in

2006-07 to US$ 56.59 million in 2010-11

India’s Footwear Export Growth over the last Four Decades

 

Export of footwear from India increased manifold over the last four decades. Today,

India’s footwear export is valued at US$ 1732.04 million, constituting 45.05% share in

total export of leather & leather products.

 

Footwear exports has increased from US$ 99.77 million in 1980-81 to US$ 1732.04

million in 2010-11

 

Major Markets:

 

During 2010-11, the main markets for Indian Footwear are UK with a share of 19.16%,

Germany 16.15%, Italy 12.46%, USA 8.04%, France 8.93%, Spain 6.45%, Netherlands

4.51%, Portugal 1.41%, U.A.E 2.45% and Denmark 0.97.%. These 10 countries

together accounts for 80.53% share in India’s total footwear export.

 

Nearly 90% of India’s export of footwear goes to European Countries and the USA.

Future growth of Indian footwear in India will continue to be market driven. The

European countries and the US are major consumers for the Indian footwear.

Footwear Exports – To major markets – 2010-11

EU – 79.15%, USA – 8.04%, Australia – 0.72% and others Others – 12.09%

A Statement showing India’s Export of Footwear to different countries:

    (Value in Million US$)    

Country

2005-

06

2006-

07

2007-

08

2008-

09

2009-

10

2010-

11

%

Share

Germany

170.9

7

217.2

3

246.8

4

229.6

5

224.2

7

279.8

0

16.15

%

UK

195.7

8 208.2

241.3

7

247.0

6

296.4

5

331.9

2

19.16

%

Italy

134.3

5

186.1

1

229.8

1

221.0

9

209.9

5

215.8

1

12.46

%

USA

131.0

7

127.1

5

136.9

2

163.0

3 123.6

139.2

1 8.04%

France 74.48 99.81

116.0

3 119.2

144.4

5

154.7

2 8.93%

Spain 63.7 64.57 76.69 91.86 95.99

111.7

4 6.45%

Netherland

s 32.96 48.57 72.91 76.2 65.13 78.19 4.51%

Portugal 22.15 35.03 37.34 28.21 22.63 24.38 1.41%

UAE 25.78 34.64 39.23 39.4 39.61 42.36 2.45%

Denmark 18.37 14.65 17.48 14.78 17.02 16.74 0.97%

Australia 11.58 10.11 12.52 13.34 15.49 12.54 0.72%

Sweden 6.77 7.99 12.04 12.64 12.2 13.76 0.79%

Canada 11.95 10.91 10.41 8.96 9.3 10.40 0.60%

South

Africa 8.26 12.11 8.52 8.49 9.87 11.07 0.64%

Japan 3.17 3.07 4.63 8.23 5.45 7.17 0.41%

Others 133.9

156.7

6

226.6

1

252.1

8

216.3

7

282.2

3

16.29

%

Total

1045.

24

1236.

91

1489.

35

1534.

32

1507.

51

1732.

04

100.0

0%

Source: DGCI&S          

 

Future Trends: - Keeping in view its past performance, current trends in global trade,

the industry’s inherent strengths and growth prospects, the footwear industry aims to

augment production, thereby enhancing its exports from the current level of US$ 1.73

billion.

 

Partnerships that spell success

 

Formas Kunz Brazil - This facility is coming up in the Footwear Component Park.

Chennai, India.

 

Feng-Tay Enterprises Co. Ltd., Taiwan - This is an SEZ-proposed facility in an area of

275 acres, coming up in SIPCOT Industrial Estate, Cheyyar (TN). Feng Tay is a

manufacturer of sports shoes, skate shoes and casual shoes for Nike and other global

brands.

 

Apache Footwear, China - This FDI is coming up in Tada Mandal, Nellore (AP), in an

area of 340 acres. Apache is a supplier of shoes for Adidas and has manufacturing

facilities in China.

 

A few other examples are, Mondial (Italy), Suolificio Malaspina (Italy), Fagus(Germany),

Zahonero Virgili SL, (Spain), Top Fondi (Italy), Xie Zhan Moulds (China)

 

Indian footwear industry poised for growth

 

India has state-of-the-art manufacturing plants. The footwear sector has matured from

the level of the manual footwear manufacturing method to the automated footwear

manufacturing systems. Footwear production units are installed with world class

machines. Manned by skilled technicians, these machines help to turn any new

innovative idea into reality. Support systems created for the sector have indeed served

the footwear industry well. India has a well developed footwear component

manufacturing industry. The future growth of the footwear industry in India will continue

to be market-driven, and oriented towards EU and US markets. With technology and

quality of the footwear improving year after year, Indian Footwear industry is stamping

its class and expertise in the global footwear trade.

Swot Analysis

 

SWOT Analysis of Indian Footwear Industry

STRENGTHS: -

Existence of more than sufficient productive capacity in tanning.

Easy availability of low cost of labour.

Exposure to export markets.

Managements with business background become quality and

environment conscious.

Presence of qualified leather technologists in the field.

Comfortable availability of raw materials and other inputs.

Massive institutional support for technical services, designing, manpower

development and marketing.

Exporter-friendly government policies.

Tax incentives on machinery by Government.

Well-established linkages with buyers in EU and USA.

WEAKNESSES: -

Low level of modernisation and upgradation of technology, and the

integration of developed technology is very slow.

Low level of labour productivity due to inadequate formal training /

unskilled labour.

Horizontal growth of tanneries.

Less number of organised product manufacturers.

Lack of modern finishing facilities for leather.

Highly unhygienic environment.

Unawareness of international standards by many players as maximum

number of leather industries are SMEs.

Difficulties in accessing to testing, designing and technical services.

Environmental problems.

Non availability of quality footwear components

Lack of fresh investment in the sector.

Uneconomical size of manufacturing units.

Competition among units vying for export orders leading to undercutting.

Little brand image.

The patriarch started this commendable journey in 1966 with the inception of Lakhani

Rubber Works, a small venture to manufacture rubber

components. His hardship and commitment made Lakhani

Rubber Works an acclaimed name in the industry. Eight

years later, he expanded his vision further when the group

diversified into the manufacturing of Beach Slippers and

that signaled a new dawn in the history of Indian Shoe

Industry. And three years later, the Canvas Shoes followed.

His endeavor and systematic approach helped the group expanding its horizons to

sports shoes manufacturing in the year 1982.

This never ending saga of success continued with their tie-up with Adidas India for the

manufacturing of sports shoes.

The Present

Today, the group is the largest manufacturer of beach slippers in India with a production

capacity of 40 million pairs per year. Also, it is the largest manufacturer & largest

exporter of canvas and vulcanized shoes in India, with a production capacity of 3.5

million pairs per year.

Lakhani Armaan group is the largest producer of Sports Shoes, PU Injected Sports

Shoes, PVC Injected Sports Shoes and Leather Shoes with a total capacity of 5.4

million pairs per year. It also manufactures high fashion ladies and gents leather shoes

for the European Union Market.

The eminence of the company, in the International Footwear Industry, is apparent from

the fact that it has been manufacturing sports shoes for the global sports apparel

manufacturing giant, adidas.

For over 80 years the adidas Group has been part of the world of sports on every level,

delivering state-of-the-art sports footwear, apparel and accessories. Today, the adidas

Group is a global leader in the sporting goods industry and offers a broad portfolio of

products.

Lakhani Armann group has been manufacturing sports shoes for adidas for the last 10

years and it is the only suppliers in India. The group is manufacturing more than 1

million pairs per year for the brand adidas including all the latest high tech shoes.

Beside this, the group also has the distinction of being the largest suppliers of

rubberized auto components to major automobile players in the Indian market. Year of

tracking key industries extensive experience and knowledge coupled with primary

research has enabled the group to deliver specified products to their customer.

Some of the names, Lakhani Rubber Work is supplying to, are :

Maruti Udyog Limited, Honda Siel Cars India Pvt. Limited, GKN Invel Transmission

Limited, Sona Koyo Steering Systems Limited, Escort Limited (Tractor Division), Escort

Limited (Farmtrac Division), Escort JCB Limited, Escort Construction Equipment

Limited, LML Limited, New Holland Tractors Ltd, Subros Limited, Ford India Limited,

Krupps JBM Ltd, Fiat (India) Ltd, Motherson Sumi Systems Ltd and QH Talbros etc.

The company has been awarded by the President Giani Jail Singh for its commitment to

quality.

Today, after this success in domestic market Lakhani Armaan has expanded its horizon

by, exporting its range of quality products to the international market in UK, Germany,

France, Spain, Switzerland, Holland, Italy, Mexico, Japan and South Africa.

The company has also been awarded by the Prime Minister Mr Atal Bihari Vajpai for its

Export Excellence.

The group very well understands its responsibilities towards its employees, environment

and society at large. It maintains social and environmental compliance to the prescribed

international standards and pays due attention towards the needs of its human

resources.

The future holds more promises to those who believe in themselves, who possess the

attitude to fulfill their goals and aspirations. The same holds true for Mr. Gunjan

Lakhani, director of the group. A man with a vision, Mr Lakhani is committed to putting

the group at the vanguard of the footwear industry.

Each member of Lakhani Armaan Group is committed to follow the vision put forth by

Mr. K. C. Lakhani. A vision to be the industry leader. A vision of growth and prosperity

for all. A vision for a better future…

Brands

» Red Label

Red Label

 

L-21 L-22 L-22A

L-23 M-01 M-01A

M-01B M-02 M-02A

» Touch Gold

102 102A L-22A

103 103A 103B

104 104A 105

105A 106 106A

106B 107 107A

» XYLO Sports

Energy-1A Energy-1B Energy-1C

Energy-2A Energy-2B Energy-2C

Energy-2D Energy-2E Energy-2F

Energy-3A Energy-3B Energy-3C

Energy-3D Energy-4A Energy-4B

sandals & slippers

JR- SD-31 JR- SD -041 DLX SD -01

DLX SD -01 C-101 SL-153

SD-908 SD -911 SD -912

C -102B SD -161 SL -152

C-821 C-821 C-903

  SLIPPER

SAILOR-405 SAILOR-406 SAILOR-701

SAILOR-501 SAILOR-407 SAILOR-501

Hawai

 

RUSTOM DELUXE HAWAI  DOUBLE PLUS 

HEALTH PLUS KANCHAN LC-01

LC-LA NICKY NICKY

Classic

C-DLX-07 C-DLX-13 C-DLX-21

C-DLX-21B C-LA-13 C-LA-14

C-DLX-25 C-DLX-51 C-DLX-51B

kid wear

K-52 LC-01 LC-02

LC-03 LC-04 LC-04B

LC-06 PK-10 PK-F2

School shoes

PT  TENNIS - DLX CLASSIC -999  

GOOD TIME S TOPPER SCHOLAR T

GOOD TIME T - 188 SCHOLAR TOPPER

CLASSIC DLX - 04 GENIUS GOOD TIME -V

CLASS MATE (V) TENNIS DLX CLASS MATE

Lakhani Armaan Group is the largest producer of Sports Shoes, PU injected Sports

Shoes, PVC Injected Sports Shoes and Leather Shoes with a total capacity of 5.4

million pairs per year. It also manufactures high fashion ladies and gents leather shoes

for the European Union market. The eminence of the company in the international

footwear industry is apparent from the fact that it has been manufacturing sports shoes

for the global sports apparel manufacturing giant, Adidas. Lakhani Armaan group has

been manufacturing sports shoes for Adidas for the last 10 years and is its only

suppliers in India. Also, it is the largest manufacturer of beach slippers and the the

largest manufacturer and the largest exporter of canvas and leather vulcanized shoes in

India, with a production capacity of 3.5 million pairs per year.

Lakhani Leather Export Division is regularly participating in the Leading Leather

Footwear Fair in the Europe:

  GARDA ITALY

  GDS GERMANY

  MICAM ITALY

At these fairs, we exhibit the company's range of finished leather footwear based on

MODEUROP. Our interaction with customers at these fairs helps us farecast fashion

trends and we offer Spring-Summer and Autumn-Winter collection to our customers

accordingly.

Sports

The sports Shoes manufacturing facility is equipped with high end machinery for

producing top of the line sports shoes. Skilled manpower and superior technology has

enabled the company to produce shoes known for comfort and better performance.

Over the years, the company has immensely upgraded itself in terms of quality and

production capacity.

Leather

Lakhani Armaan has world-class facilities at its leather shoe

manufacturing unit. It’s a perfect blend of man & machines

to achieve world-class quality standards. At Lakhani

Armaan, special care has been taken to ensure that the

leather footwear developed at its manufacturing facility

combines the right balance of fashion and comfort.

Canvas

At Lakhani Armaan canvas Shoes are manufactured in the state of the art facility. The

facility is well equipped to manufacture premium-quality Premoulded Canvas Shoes,

Rolled Sole Canvas Shoes and Unlined Vulcanized Shoes. The division is producing

more than 11000 pairs per day for the domestic and export

market.

EVA

Lakhani Armann has ultra modern facility for the

manufacturing of EVA and Beach Slippers. The group has

made the best use of the EVA injection technology by substantially increasing the

product line and the production capacity. The company is again geared up to install two

color EVA injection machines in its facility.

Research & Development

Footwear is no longer just a functional necessity, but rather, something that is flaunted

as a fashion statement. A good shoe should have both, Comfort and Style and it should

adjust to your feet with every step. To survive this test of time, it is always necessary to

keep abreast with the changing market trends and to innovate new and fresh.

Therefore, Research and Development is a key area of operations at Lakhani Armaan.

Latest trends and technological innovations are researched extensively in the process

of creating new products and designs.

The Quality

The VISION inspired Lakhani Armaan Group ensures strict adherence to quality

standard at each and every stage of operation. The group has translated its

commitment to quality into clear objectives where strategies and plans are shared by

the entire organization.

Technology

Footwear Technology is evolving at an amazing speed. Better and updated technology

is the key to the quality and enhanced productivity. Lakhani Armaan Group blends

premium material and advanced technology to produce footwear of international

standards. The group has pioneered in latest footwear technologies like PU, EVA etc.

Marketing of Lakhani Brand

BRAND STRATEGY of Lakhani BrandBranding in essence is effective brand strategy. It's the application of sound research into brand communications, analytical techniques, and the development of an improved strategy for your brand.

Strategy is all about brand positioning. It identifies the key elements of product brand and develops a branding action plan to implement it.

BRAND STRATEGY DECISIONLine extension

brand extension Extending the brand

Line extension

Reaching out to a new category

Brand relaunch

Multibrands

New brand name

Marketing of Lakhani Brand of Wootwear

Adidas histiory

A history of innovation…

adidas’ history of innovation and firsts in the field of sports performance is a testament

to the belief that impossible truly is nothing. The founder of adidas - Adi Dassler was

inspired by a single idea when he made his first shoes in 1920 at the young age of 20.

His vision was to provide every athlete with the best footwear for his/her discipline.

Since then, the brand has become synonymous with innovation and passion for sports.

From creating the first football shoe in 1929, the first tennis shoe in 1931, to the

revolutionary introduction of football shoes with removable studs in 1954, adidas has

never let impossible get in the way of its relentless quest to give athletes the technology

and products they need to excel. adidas’ vision is to bring its passion for sport, the

athlete and the product, to anyone who comes in contact with the distinctive three

stripes.

The Indian team…

Established in 1996, adidas India Marketing Pvt. Ltd. is the Indian subsidiary of adidas-

Group AG. For over 80 years the adidas Group has been part of the world of sports on

every level, delivering state-of-the-art sports footwear, apparel and accessories. Today,

the adidas Group is a global leader in the sporting goods industry and offers a broad

portfolio of products. Products from the adidas Group are available in virtually every

country of the world. Headquartered in Herzogenaurach, Germany, in India, adidas

products are available in all key cities. Having almost completed a decade in the

country, adidas today has more than 400 stores across the country. The current focus

of the company is on building a strong supply chain and a group of franchisees that

share the brand’s passion and vision.

Personifying Impossible is Nothing…

adidas has a firm belief in supporting and working with leading athletes who bring the

passion behind Impossible is Nothing to life everyday through excellence in their field.

From football legends David Beckham, Kaka and Messi, basketball greats Tim Duncan

and Kevin Garnett to tennis champion Novak Djokovic and the swimmer known as the

Thorpedo – Ian Thorpe, adidas’ brand ambassadors battle the impossible in every

sporting discipline. adidas’ brand ambassadors in India include the country’s most

famous sporting icons and god of cricket Sachin Tendulkar, one of the most destructive

openers Virender Sehwag, young and exciting cricketer Suresh Raina, the 1st Indian

Global Brand Ambassador- Sania Mirza and the young tennis sensation and the winner

of Junior Australian Open Tennis Tournament 2009 Yuki Bhambri.

Image of Adidas & (Income group target)

Mens

Men's Products (Footwear Clothing Accessories )

A clean look for graceful players who know how to play with finesse. The adidas football

adiCORE 3 IN boot features adiPRENE® cushioning and fine Superleague leather for

inspired indoor play.

Huge verities for sport wear and sneakers (color also)

Questioneers

Q. How the footwear market has changed in the last few years as seen by you?

A. See, footwear industry is no exception when you take into account that the overall

market has changed in the last decade. Everywhere the supply is more than the

demand in the market. So consumers are flooded with optional offers from different

brands. So the overall supply has gone up but the consumer spending per se has not

gone up as per the expectations of the marketers.

Globalization has also changed the market quite dramatically creating a cut-throat

competition especially with China emerging as a big threat. But any overseas player

finds India a tough market as India is a very vast country with diverse tastes, demands

and culture. And Liberty is firmly entrenched in the Indian market fully knowing the pulse

of the consumers.

Q. How Lakhani emerged as a forceful brand in the footwear market?

A. See, we started our business in (Haryana) way back in 1944. We made a beginning

as a small retailer sourcing shoes from small local manufacturers. In 1948, we started

manufacturing our own footwear.

However Lakhani as a brand name came into existence in 1954. We catered mostly in

domestic market in neighboring areas like Haryana, Himachal Pradesh, Punjab and

some parts of Pakistan till 1964. Thereafter, export market caught our fancy and by

1968, we completely switched onto exports. And till 1983, we were 100% exported

oriented unit in terms of sales. In 1983, we turned our attention towards domestic

market again. We introduced a new technology of PU (Polyurethane) based sole shoes

in the Indian market as we were exporting these kinds of shoes to our international

customers. At the same time, the second generation of our family also entered the

business.

Q. Since you were not in the Indian market for long, you must have had to

establish Lakhani as a brand among the Indian consumer as well as trade?

A. Yes, because of our absence for a long time in the domestic market, our immediate

task was to create awareness for the Liberty brand name in the Indian market. Our

advertising and promotion strategy over the years has consistently aimed at positioning

Liberty as a complete family footwear brand. Initially, we focused on the upper class

segment as our core target market. Later on, we shifted our attention towards the

middle and upper-middle class segment also.

Q. Why this change of target group?

A. See, the premium segment does not offer volumes. The market up there is very

small and there are too many players in fray. Therefore, in order to grow by gaining in

volumes, we have moved towards catering to the middle and upper-middle class

segments, which offer a far higher off-take of footwear.

Q. How Lakhani positioning has changed with the changing market dynamics?

A. Till few months back, the customers perceived Liberty as a comfortable, durable and

great value for money brand. We are trying to enhance that perception by positioning

Liberty as a more vibrant and contemporary brand too. The new positioning does not

mean that we are moving away from the comfort, durability and value planks. Those will

always be there associated with Liberty. So Liberty as an umbrella brand has become

more fashionable in tune with the changed market needs now.

Q. What kind of footwear range is offered by the Lakhani brand?

A. In 1991, we took a stock of the long-term view of our business and marketing

strategy. Thereafter, the Lakhani product range was divided into number of categories

with their own sub-branding under the umbrella Lakhani brand .'Fo 10', fashionable

sports shoes (not performance sports shoes) was the first sub-brand launched by us.

We have 'Fortune' for men's formal and 'Windsor' for executive range mostly for the

people who are on the move. So we have three ranges in men's shoe category. We

have 'Coolers' which is a sandal for both men and women. For women, we have

'Senorita' for more fashion conscious women and 'Tip-Top' for married women who look

for more comfort. Then we have 'Gliders' which caters to the entire family from 4-years

to 50-years plus. It is positioned as a young brand. In Gliders, we have three categories

- Glider C for children, Glider P for teenagers and Gliders A for adults. We also have

'FootFun' for children and 'Prefect' which is children's school shoe. We also have

'Warrior' which is a shoe for industrial applications with a safety benefit used primarily in

factories and army. Besides these 10 sub-brands, we also have a brand called A-Ha

which is a hawai chappal, catering to the lower class segment market. But A-Ha is not a

sub-brand of Liberty as we do not cover it under our branding.

Q. Which one is your best performing sub-brand?

A. In terms of number of pairs, Gliders is the No.1 sub-brand in our portfolio as it is

catering to a wider age group range and offers the maximum choice.

Q. What is the share of Liberty brand in the overall footwear market in India?

A. In terms of number of pairs, it is very difficult to analyze because 75% of the industry

is in the unorganized sector. But according to certain Govt. agencies, India produces

about 1.1 billion pairs of footwears. In value terms, the industry size should be around

Rs.8,000 crore including exports. In the organized sector, we are second to Bata with a

turnover of about 350 crores.

Q. What makes Lakhani different from other competing brands?

A. I would say the brand personality of Lakhani is different from other brands like Liberty

Action etc. Unlike others, we are catering to the entire family. Bata is the only other

company which offers the complete family range of footwear like us. Other players are

catering to certain niche markets only such as Lakhani is more into rural segment or

Action which is more into teenagers and kids only. So Liberty is catering to a very large

segment of the market through its wide range of sub-brands whereas others are single

brand entities.

Q. What role advertising has played in creating a distinct personality of Lakhani

brand?

A. We strongly believe that advertising for a brand is the fuel for the growth of the

company. See, consumers react to the advertising which results in a demand for a

brand translating into sales for the company. Thanks to our advertising consistently over

the years, Liberty has been perceived as a brand which is young, modern and offering

new and international range of footwears. But in the last two years or so, we felt that

ads irrespective of the TV, press or outdoor mediums were not adding any value so we

toned down our ad spend.

Q. But don't you think this drop in advertising affected the consumer's mind as he

finds the brand less visible then before raising doubts in his mind?

A. Yes certainly, low visibility does affect the brand's share in the consumer's mind. But

business was low and we tuned down the advertising to a minimal level. However, we

took stock of the situation and as business has improved, we have again upped our ad

budget. This financial year we plan to spend around Rs.12 crore on our advertising. We

have changed our ad strategy also by opting for advertising in the peak seasons only

instead of advertising through out the year. Even our advertising creatives have also

undergone major change. Our ad campaign has become more youthful and catchy

communicating the new fashionable appeal of Liberty brand in a more effective manner.

Q. How loyal are the Lakhani customers to the brand?

A. We fare very well on the loyalty parameter among the customers, However, as I said

earlier, in the last few years brand loyalty among Indian consumers has eroded and

foreign brands/products are perceived to be better than Indian products/brands. But our

experience shows that customers are now realizing that among the footwear

products/brands Lakhani is still the best brand in the country and Liberty customer

loyalty is further improving.

Q. Which are the major channels of sales of Lakhani footwears?

A. Well, we sell through 350 exclusive Liberty showrooms and more than 4000 multi

brand stores spread all over India. But the retail stores are neither owned nor managed

by us.

Q. There has been a trend to push sales through factory outlets. What do you

think about it?

A. The trend of pushing sales through factory outlet has been borrowed from Western

countries in India. However, I feel that Indian markets are not as matured as Western

markets. Neither we have high street shopping concepts in whole of India nor the

customers are short of time. Yet percentage of factory outlets is very high and they are

very very visible on main highways. The customers, to take advantage of discounts,

prefer to buy the products at factory outlets which erode the value of the brand and

business shifts from prime outlets to secondary outlets. I feel that Indian companies

should not push factory outlet concept in the prime markets highly visible sites for at

least next 10 years.

Q. What are your plans for the future?

A. I think Indian consumer is now more aware of international trends and shopping

standards as our markets are becoming an important part of the global market. Being

associated with exports for last more than 40 years, we have an advantage of providing

international quality products to Indian consumers and in terms of technology and

styling, we are not behind international trends. However, we do not provide international

shopping experience to Indian consumers and therefore in the last 3-4 years, we have

made conscious efforts to upgrade the standards of our retail outlets and we shall

continue to do so to make the shopping enjoyable for the Indian consumers. Moreover

we shall continue providing the latest high quality products to Indian consumers at

affordable prices, which are not only comfortable but durable too.

CONCLUSION

To conclude, it can be said that through the global sports outfit retail industry

has reached its maturity, but the Indian sports retail industry is still at its infancy.

But with the huge potentiality existing in the Indian market, it is expected to

grow in leaps and bounds in the future.

For a start, retailers need to invest much more in capturing more specific market.

Intelligence as well as almost real time consumer purchase behavior

information. The retailers also need to make substantial investment in

understanding/acquiring some advance expertise in developing more accurate

and scientific demand forecasting models. Re-engineering of product sourcing

philosophies-aligned more towards collaborative planning and replenishment

should then be next on their agenda. The message, therefore for the existing

small and medium independent retailers is to closely examine what changes are

taking place in their immediate vicinity and analyze weather their current market

offer a potential redevelopment of the area into a more modern multi-option

destination. If it does, and most commercial area in India do have their potential,

it would be very useful to form a consortium of other such small retailers in that

vicinity and take a pro-active approach to pool in resource and improve the

overall infrastructure. The next effort should be to encourage retailers to make

some investment in interior of their respective establishment to make shopping

an enjoyable experience for the customer.

Finally, it is important to note that these strategies are not strictly independent of

each other; value is function of not just price, quality and service but can also be

enhanced by personalization and offering a memorable experience. In fact,

building relationship with customer can by itself increase the quality of overall

customer experience and thus the perceived value. But most importantly for

winning in this intensely competitive marketplace, it is critical to understand the

target customer’s definition of value and make an offer, which not only delight

the customers but also difficult to competitor to replicate.

Bibliography

BOOKS REFERRED:

1. Marketing – Ravi Shankar

2. Marketing – Rampal Gupta

SITES VISITED:

www.historyoffootwear.com

www.fotwear.com

www.datamonitor.com

www.addias.com

www.lakhani.com

Annexure -1

Indian Footwear Market Forecast to 2012

India is standing on the threshold of a retail revolution and witnessing fast changing

retail landscape, with footwear market is set to experience phenomenal growth in

coming years. Besides, the ongoing financial crisis is unlikely to have any significant

impact on the Indian footwear market as the demand for Indian footwear will continue to

grow, according to our recent report, “Indian Footwear Market Forecast to 2012”.

Demand for high quality footwear produced in Europe and other parts of the world is

expected to slowdown as people will look for medium or lower priced products. This is a

good sign for the Indian footwear industry since India along with China is the main

supplier of low-priced footwear. However, Chinese producers are facing serious

problems due to rising labor cost, which has risen by around 40% since January 2008,

and currency appreciation. Chinese products, which used to be cheaper by around 10%

compared to the Indian products, are no longer cheaper. Implementation of the

European Union (EU) anti-dumping duty .

Under these circumstances, India is the only major source for supplying medium and

low-priced footwear. Moreover, most of the global footwear manufacturers, particularly

European manufacturers who were sourcing from China, have now turned to India.

Nike, Addidas and Puma are some of the footwear majors are expected to route parts of

their production and purchase out from China to India.

This report provides extensive research and in-depth analysis on the Indian footwear

market. The detailed data and analysis given in the report will help the client to evaluate

the leading-edge opportunities critical to the success of the footwear market in India.

The forecasts and estimations given in this report are not based on a complex economic

model, but are intended as a rough guide to the direction in which the market is likely to

move. This forecast is based on a correlation between past market growth and growth

of base drivers.

Our report also provides forecasts on

-Indian Footwear Market (2009-2012)

-Men’s Footwear (2009-2012)

-Children’s Footwear (2009-2012)

-Women’s Footwear (2009-2012)

-Casual Footwear (2009-2012)

-Mass Footwear (2009-2012)

-Sports Footwear (2009-2012)

-Premium Footwear (2009-2012)

-Footwear Export (2008-09 to 2010-11)

Key Players

This section provides business overview and SWOT analysis of key players in the

footwear market. The key players discussed in the report are Lakhan, Bata India

Limited, Adidas AG and NIKE, Inc