Crocs India To Quadruple The Number Of Retail Stores By 2020
Encouraged by its continued profitability for the past four years, the Indian arm of US based manufacturers of patented plastic shoes, Crocs, wants to quadruple its presence in the retail market by expanding to over 250 stores from the current 58 stores by the end of 2020.
Crocs India operates via the franchisee route with presence across a mix of standalone and multi-brand outlets in tier-1 and tier-II cities. Going forward, the company plans to expand its presence in large-format departmental stores like Lifestyle, Shopper’s Stop, Pantaloons and multi-brand stores like Metro, Inc.5 and Regal.
Crocs which has positioned itself as a premium casual lifestyle brand, claims to have cornered over 10 per cent share of the total market size in the organized non-leather, non-sports casual footwear segment.
Speaking to BW Businessworld, Deepak Chhabra, Managing Director of Crocs India, said, “Crocs has been consistently growing over the past 5 years. We grew by 73 per cent year on year in 2016. This year we are again eyeing a high double digit growth.” On expanding its presence in the online platform he said, “Online remains an integral part of our business but we expect it to stabilize in the coming years to about 10-12 per cent of our overall business.”
The total footwear market size is pegged at about $5 billion or around Rs 32,000 crore in India, with per capita consumption of 1.2 pairs. Men footwear dominates over the women footwear. Crocs clocked $1billion or over Rs 6,400 crore in annual global sales last year. So far it has been able to sell 350 million pairs globally since its inception in 2002. Crocs is among the top 10 non-athletic footwear brand with distribution in over 100 countries. It sold 55 million pairs last year, the average selling price (ASP) being Rs 2,800.
The brand started its operations in 2007 in the country. Its sales have been growing over the last three years. It sold 900 thousand pairs of shoes in the year 2015, 1.5 million in 2016 and are expecting to sell 2.0 million pairs this year. It is a franchise model and largely with single pan India partner, Metro Shoes- Footwear Retail Company.
Impact of GST:
Talking on the effect of the Goods and Services Tax (GST) on the sales of shoes in India, Chhabra said that their products attract 18 per cent rate under the tax reform and their sales have remained unaffected by the implication of the tax law. He said, rather it has helped them to expand their business.
Crocs is available through both retail and online channel. Retail has been more profitable for the brand, also strategically more important as online channel is mostly driven by deal seeking customer whereas brick and mortar is where the consumer gets to experience the brand as a whole.
“There is a conscious effort to restrict discounted online sales and grow our retail footprint,” added Chhabra.
