Client: India’s second largest shoe retailer, with three retail brands, 240 company-owned shops in 73 cities, and sales of Rs. 700 cr, growing at 25% per year.
Promoter’s Dream: To grow at least five times larger – to become the dominant player in Indian footwear – bigger than Bata with sustained, profitable, growth.
The Avenues of Opportunity Recommended by OPENMIND
Start With Small Towns: OPENMIND recommended that the client open shops in 1000 towns in a phased manner, through the franchising route. The client has already built nationwide brand awareness, but is not monetizing it, because of its presence in only 73 cities. OPENMIND MD, Mr. Richard Rothman urged the client to tap the huge latent demand in smaller towns, helping them to uncover an enormous opportunity for sustained, profitable growth.
In the Value Segment, Create a Product Brand, Not a Store Brand: The client created a successful model for a nationwide store brand in the value segment, but lacked the bandwidth to scale it. OPENMIND recommended that the client transform this store brand into a product brand, which it can distribute through thousands of shoe retailers nationwide. By converting a store brand into a product brand, Mr. Rothman helped the client to recover a huge opportunity for sustained, profitable growth.
Create E-Commerce Infrastructure: Shoes comprise a whopping 30% of online sales, but nobody makes money. OPENMIND recommended that instead of selling shoes online, the client should provide comprehensive services to other online shoe retailers for sourcing, fulfillment, and more. By providing the marketplace infrastructure for online shoe retailers, the client can benefit from the growth of this market, while developing needed skills in inventory and logistics management. Through this recommendation, Mr. Rothman helped the client to discover a new opportunity for sustained, profitable growth.
Actions Taken: The client appreciated and accepted the OPENMIND recommendations and is now into the implementation phase. There was promoter participation and involvement in the entire process and decision making.
The OPENMIND Advantage
Industry: The retail footwear industry is projected to grow at a Compounded Annual Growth Rate of 12-16% over the next five years.