Bags / Shoes & Accessories

According to the observation report of Huacheng import and export data, the footwear market is moving towards the high-end trend, which is due to the growing consumption of formal shoes, sports shoes and party shoes in the high-end market. However, under the influence of high inflation, consumers in the mass market reacted coldly. According to the September financial report of Relaxo Shoes, the performance of its affordable slippers, sandals and sports leisure shoes in the past 10 quarters was the worst, dragged down by the high cost of raw materials and weak overall demand.

According to the Huacheng Import and Export Data Observation Report, Ramesh Kumar Dua, the managing director of Relaxo Shoes, said at the recent financial report meeting that the mass market consumption, which accounts for a considerable share of our business, has been affected. In addition, the poor performance of the rural market in India, and the rural market is more affected than the urban central market.

According to Huacheng Import and Export Data Observation, Dua said that as customers turned to cheaper alternatives, product prices fell sharply, and Relaxo had to cut prices substantially to curb sales decline. When the price of raw materials keeps rising, the company is forced to raise the price of its products. Compared with local purchasing enterprises, Relaxo's raw materials are purchased from overseas, and the supply chain cycle is long, and the time required for product price adjustment is long, which affects the competitiveness of product sales.

However, Dua said that the price adjustment will help us clear the high cost inventory in the next quarter and ultimately improve our future sales. "

Similarly, Metro brand said that after the consumption tax was raised by 700 basis points earlier this year, the company had seen the pressure faced by mass footwear products and was "forced to withdraw" from some low-end footwear products. However, the company's demand for medium and high-end products has increased significantly. The sales revenue in the third quarter increased by 47% year on year to 4.76 billion rupees, the operating profit margin increased by 31% year on year, and the net profit increased by 41% year on year to 780 million rupees, Huacheng Import and Export Data Observation reported.

Gunjan Shah, Director General Manager and CEO of Bata Brand in India, stressed that "due to the impact of inflation and changes in consumption tax", the company is more inclined to produce and sell high-end products, reducing the production of footwear products for the mass market. According to the observation of Huacheng's import and export data, its revenue increased by 35% year-on-year, close to 8.3 billion rupees, 15% higher than the level before the COVID-19 epidemic.

Shah also said: "Its high-end brands such as Hush Puppy, as well as North Star and Floatz, have significantly outperformed other brands in their sales revenue of sports shoes. We have seen the huge market potential and attraction of high-end brands, and we will continue to participate in them."