India’s footwear market is expected to experience double-digit growth, reaching a market size of INR 191K crore by FY 2028, according to a report from the market research firm 1Lattice.
According to the report, the footwear market stood at approximately INR 123.5K crore in FY2024.
“The footwear industry finds itself at a pivotal juncture, shaped by evolving consumer tastes, swift technological progress, increasing calls for sustainability, and the rise of the resale market. With a projected Compound Annual Growth Rate (CAGR) of approximately 13%, the industry is set to soar, reaching INR 191K Cr by FY28. Looking ahead, there exists immense potential for substantial growth and expansion, benefiting both newcomers and established brands,” remarked Ashish Dhir, Senior Director at 1Lattice.
The surge in growth can be traced back to pivotal factors such as escalating disposable incomes, advancements in technology, the upscale trajectory of the industry, evolving consumer preferences, and the expanding scope of urbanization.
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Observing the trend towards premiumization, the report indicated that a focus on elevating quality would propel the premium footwear market share from 47 percent in FY2021 to 49 percent by FY2025. Furthermore, it anticipates that the Consumer Price Index (CPI) will drive footwear prices upward, consequently fostering growth within the footwear industry. Over the past three years, India has experienced an average CPI of 5.5 percent, according to the report.
Regarding challenges, factors such as counterfeit products, inefficient inventory management, low margins, and labor-intensive manufacturing processes serve as key growth barriers for retailers.
According to the report, approximately 70 percent of the footwear industry operates in an unorganized manner, presenting challenges for organized retailers to effectively compete in terms of pricing and market presence.
Furthermore, intense competition from established brands and the influx of new entrants result in price wars and exert pressure on profit margins.
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Shedding light on emerging trends within the footwear sector, the report underscored a growing consumer awareness regarding the environmental repercussions of their purchases. Consequently, footwear companies are actively investigating the utilization of recycled materials, vegan leather, and sustainable manufacturing techniques to mitigate environmental harm. Notably, there’s a discernible shift towards non-leather footwear, attributed to its cost-effectiveness, durability, and adaptability.
In terms of technology, brands are actively exploring the integration of virtual try-on and augmented reality (AR) technologies to enhance the online shopping experience.
Additionally, the report underscored the growing trend of collaborations between fashion and luxury brands with athletic footwear companies, alongside the flourishing sneaker culture, resulting in the proliferation of limited editions and the resale market.