Is Lack Of Innovation A Big Roadblock For Footwear Retail In India?

Sep 23, 2020

The footwear sector in India has come a long way from those days when it only met utilitarian needs. Today, thanks to the ever-increasing number of fashion-conscious millennial shoppers and a growing love for brands, India is using almost 16 billion pairs of footwear annually, emerging as the second largest global producer. Owing to such consumption and demand patterns, the footwear market is expected to grow rapidly in future.

However, the sector has some challenges to overcome and must embrace innovation to make better headway. So, let’s see what lies ahead of the Indian footwear retail industry.

What are the challenges?

The pandemic is likely to impact the footwear sector’s performance in the FY2021 Also, due to online channels, offline sales have dropped by 30%. Hence, the retail industry needs to gear up. The problems faced by the Indian footwear retail sector are:

· Tough competition from unorganized players

Nearly 85% of the Indian footwear industry comprises of unorganized players. These players sell their products at unimaginably low prices as they bear lower sales tax, lower overhead cost, lower labour cost and there is no research and development (R&D) involved.

· Importing cheap leather hurts Indian manufacturers

63% of the leather that is imported comes from India’s neighbour, China. This hurts the Indian footwear manufacturers as Chinese leather is cheaper and is sold in the unorganized retail market, creating a loss for the economy.

· Consumer expectations have also increased

Since many suppliers are offering their products online these days and technology has made it easier to view and order shoes via mobile devices, consumers expect better services, instant product availability and fast delivery.

· Inefficient supply chain management

Slow product development and manufacturing are often caused by scarcity of skilled artisans (as customers want more variety in designs), dependence on imports (especially China and Taiwan), and taxes affect the flexibility, cost and availability of shoes. Hence, supply chain management needs to be more efficient

So, what to do?

Footwear retailers have to innovate and come up with robust strategies to survive. Here are some suggestions to take a footwear retail business to the next level.

· Market your products to a robust customer database regularly, via monthly emails maybe.

· Create a rewards program for your best customers.

· Utilize your sales counter space, or make it bigger to offer accessories and impulse buy items.

· Set up a Facebook and Instagram account and add your store to Google Maps.

Innovative trends to attract customers

Many leading retailers are improving their in-store shopping experiences and offering value-added services like 3D foot-scan for crafting customized shoes and innovative insoles that cradle your feet and soothe aching muscles. Technological advancements like virtual reality now make it possible for those with foot problems to go for stylish shoes that are comfortable and functional too.

 

Some other trends in the footwear retail market include -

· Automation to keep up with customer needs

Forward-thinking footwear brands are embracing automation to make the production process simpler, efficient and faster than before. This way, they can come up with designs that customers currently want.

 

· More variety (especially in sports and athleisure shoes)

While sports, stylish, formal, and casual are the main categories of shoes on offer, top brands are providing more options in the form of subcategories. Like, you can choose different shoes for running, walking, exercising, golfing, and adventure sports or outdoor activities like hiking, trekking and climbing. The athletic and athleisure sections have witnessed rapid diversification especially. Light and breathable materials are being used and there is ample variety in colours too.

 

· Smart in-store display

When customers walk into a branded store, they can check out the entire collection easily and can make a choice after comparing their favourites. Also, many brands are regularly changing in-store display shelves and windows to bring in repeat customers who look forward to and track new arrivals.

 

So, for the Indian footwear industry to explode and deliver, favourable government policies, better infrastructure, lenient taxation, technological innovation, and brand building exercises are some of the things that need to come together seamlessly.

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