Skechers, the leading international sports and lifestyle footwear brand is bracing for wider presence with 100-125 stores in India in the next 3-4 years.
Unveiling the future strategies David Weinberg, Chief Financial Officer, Chief Operating Officer, Executive Vice President, Director of Skechers USA, Inc spoke to TFW Bureau in detail.
How optimistic are you about the Indian market?
We are very optimistic of Indian market as our brand is performing well in retail which is a great sign. Our retailers and partners are happy and are looking for growth. India is a mega market place for inexpensive footwear and that’s what brings us to the marketplace. Brands like Nike is doing $120- $150 million business in India, they are growing significantly, have a great presence and that’s where the middle class consumer does watch sport. This is the trend growing in India and that’s where we fit in.
What are your plans of expansion in India?
We will continue to expand in India. Along with exclusive brand outlets (EBOs), we will continue to expand through Multiple Brand Outlets (MBOs) and franchisees and this is what we do everywhere in the world. Presently we have 35 stores of Skechers and probably in the next three or four years the count will grow to 100 to 125 depending upon the number of franchisee partners will join us. Simultaneously, we are selling through 700 MBOs and planning to increase the count significantly. These stores will be spread across metros to tier IV cities in the country. Overall we are present in 40 cities across India.
The average area of stores varies from 1000 sq. ft to 1200 sq. ft and ultimately as we will bring our more products and the brand gets accepted, we will probably double the size of the stores. Around the world we have 1000 sq.ft to 30,000 sq.ft of stores. We want to expand across south, west, east, north region of the country.
After expanding our capacity in the metros we will move to tier I to IV cities. We start in the bigger cities first and that’s how we started in China as well.
Have you finalised the franchisee partners?
No we haven’t yet. We are going to look at. We have to establish the model first and we have to establish the profitability and acceptance before selecting the franchisee partners to jump on board.
What are your marketing and promotion strategies?
We do whatever we can. We are promoting the brand through online, social media and print media marketing, campaigning through TVC and big promotions in store.
How Indian consumer is evolving to the international styles of footwear?
Indian consumers are evolving like every place in the world. Here consumers want upward mobility, worldwide brands, quality and more styles. They see style when they travel, they see style on the internet, on TV and aspires to be well dressed and comfortable. I think consumers around the world and in India are growing more alike than ever in the past.
What is your global turnover and how much India contribute?
We are now 22 year old company and have clocked the revenue of $3 bn internationally this year and we anticipate doubling the revenue in the next five years. Our biggest growth comes from international markets. India is still one of the smaller markets for us and can become one of the significant markets over the next two or three years, simply because in India 300 million middle class consumers for footwear can double in the coming 10 years. Our goal is to be in the top three or four brands in India. We have just established the brand here and it has the potential to grow. Large part of our sale comes from metros.
Internationally we are growing by 30-35 percent annually and we anticipate growing by 20-25 percent next year. In the next five years we see Indian market equivalent to the China market. In China, we will have 1500 franchisees this year so, we understand what the model is and how it works very differently, because they all have shop-in-shop. In China we will be going from 200 million to 400 million consumer base this year.