Stepping into Style: India's Thriving Footwear Industry
India's footwear industry strides confidently on the global stage. As the world's second-largest producer, contributing 13% to global footwear, India's potential is undeniable. While exports hold a 2.2% share, the domestic market is the true powerhouse, valued at $26 billion in 2024 and projected to reach $90 billion by 2030, boasting a robust CAGR of 4.85%. Production is equally impressive, with a volume of 2064 million pairs expected to hit a staggering 2 billion units by year's end, reflecting an 8% CAGR.
Let’s get into Market Dynamics and Competition
The Indian footwear industry is a competition powerhouse. Leading brands like Relaxo and Bata (holding market shares of 7.64% and 6.95% respectively) battle it out alongside domestic players like Liberty Shoes and international giants like Nike and Adidas. While some smaller players struggle, the industry thrives on constant innovation, efficient supply chains, and effective marketing strategies.
Leather vs. Non-Leather Footwear: A Changing Tide
Traditionally, leather footwear has dominated the Indian market, holding a 70% share and generating a volume of $18.08 billion. However, a noteworthy shift is underway, with the non-leather segment emerging as a formidable player. In 2021, non-leather footwear constituted a significant share of the total market, with a market size of $4.3 billion, producing 1056 million pairs compared to 909 million leather pairs. This flourishing segment, encompassing sports shoes, running shoes, casual wear, and sneakers, is anticipated to capture a substantial 75% market share by 2030.
This transformation is driven by changing consumer preferences, a greater emphasis on sustainability, and a shift from small-scale, cottage industries to large-scale corporate production.
Sustainability: Eco-conscious consumers are turning away from leather.
Changing Preferences: Fashion-forward trends favor non-leather options.
Shifting Production: Small-scale leather production is giving way to large-scale, non-leather manufacturing.
A Younger Generation Steps Up
India’s rapidly growing youth population is a key demographic for the footwear industry. This segment is more fashion-conscious, prefers non-leather options, and has more disposable income, driving demand for diverse and high-quality footwear products. Rising disposable and per capita incomes have transformed consumer spending habits on apparel and #Footwear. A larger segment of the #IndianPopulation, spanning tier I and II cities as well as smaller towns, now enjoys significantly greater purchasing power. This surge in spending is driving rapid growth and widespread expansion in the footwear market.
E-commerce vs. Offline Sales: The Digital Shift
The Indian e-commerce industry, especially in footwear, has been on an upward growth trajectory. It is predicted to reach US$5,071.0 million by the end of FY 2024 and accounts for 25.9% of the fashion eCommerce market in India. It is expected to increase at a CAGR of 11.7% (2024-2028), resulting in a projected market volume of US$7,890.3 million by 2028. The online footwear market has grown significantly over the past several years as e-commerce serves as a link between premium footwear businesses and potential end users in cities with limited infrastructure for retail setup. In August 2024, the Indian #OnlineFootwearMarket generated US$430 million, marking a 1% increase from July. This growth is fueled by the rise of digital payment systems, boosting convenience, and the adoption of omnichannel retailing, offering seamless shopping experiences across both online and offline platforms.
Offline channels currently account for most sales of footwear in the Indian market, supported by well-established retail infrastructure and consumer preference to test products for fit and feel before purchase. However, the sales of footwear in India via online channels are projected to increase at a robust pace over the coming years.
Unorganized Footwear Market Dominates in India, But Organized Players Gain Ground
In India, unorganized players dominate the #FootwearMarket, accounting for 85% of the total, benefiting from lower taxes and labor costs. However, as consumer preferences shift, organized retail is gradually carving out its space. Around 90% of footwear produced in India is consumed domestically, with the remaining 10% exported, primarily to European countries like the UK, Germany, Italy, and France. Within the organized sector, Relaxo Footwear leads with a 3.23% market share, followed by Bata India at 2.34%.
Alpha Opportunity: Revolutionizing Midsole Technology
Shoes are made up of several key components: the upper, insole, midsole, and outsole. Successfully entering the footwear market requires a deep understanding of these technical aspects. Often, the molds for outsoles are produced in China, Taiwan, Europe, Indonesia, Vietnam and then imported to India, while other parts are assembled domestically. Innovation in materials and product design has been crucial for the success of some top global brands.
In India, there is substantial potential for innovation in midsoles. These components, typically crafted from foam materials like EVA or TPU, provide cushioning and enhance performance by efficiently returning energy. Leading global footwear brands have developed unique midsole technologies, such as Nike’s ZoomX and Adidas’ Boost foam. Newer brands are also advancing with cutting-edge designs.
Government Policies and Support
The #IndianGovernment has implemented various policies to boost the #FootwearIndustry, including support for the leather sector and initiatives to improve manufacturing infrastructure. These measures aim to enhance production capabilities and foster a conducive environment for both domestic and international players.
Manufacturing Powerhouse: India as the New "China + 1"
India's strategic location and skilled workforce make it an attractive manufacturing destination. India has positioned itself as a new China+1 destination, with Tamil Nadu emerging as a significant #ManufacturingHub. The iconic Crocs are now being manufactured in Tamil Nadu, proudly bearing the label ‘Made in India,’ with manufacturing operations centralized in the footwear park in Perambalur, Tamil Nadu.
Ensuring Quality: BIS Compliance and Supply Chain Excellence
On the supply front, the Bureau of Indian Standards (BIS) compliance requirements are poised to transform the industry. This regulation mandates that all foreign manufacturers secure a BIS certificate for their imports, aiming to curb sub-standard products and promote local manufacturing. With access to essential materials like EVA, TPR, and PVC—sourced both domestically and internationally—alongside its expanding manufacturing expertise, India is well-positioned to lead this transition.
A Look Ahead: Future Full of Promises
The Indian footwear industry is poised for continued growth, fueled by a young, fashion-conscious population, a growing e-commerce market, and a thriving manufacturing sector. The key to success lies in innovation, embracing technology, and catering to evolving consumer preferences. As the industry navigates this exciting journey, some players may stumble, but others will rise, ensuring a vibrant and ever-evolving footwear landscape in India.
We are excited about the innovation and growth opportunities in this sector!
Missing - Demographics - we need to check -
New Data Included:
We have included the demographics of how the footwear industry market has been expanding in India due to the digital payments system etc.
We have included the data for organized and unorganized footwear sector
More countries (other than China) who produce molds for outsoles have been added.
Sources:
