Shoe Industry

Topics: Athletic shoe, Shoe, Footwear Pages: 3 (552 words) Published: October 12, 2008
Shoes Industry – PEST Analysis
Political
Recent merger between Adidas and Reebok
Use of leather to make shoes by Bata, Red tape
India is not a sporting Country and hence lesser demand for sports shoes. •home market lobbying/pressure groups
Very few sporting events apart from cricket fixtures to attract customers
Economic
Marginal share of 2.44 percent in global trade worth US$ 97.606 billion •Estimated target of 12 bn $ (7bn $ export + 5 bn $ domestic) trade by the year 2012overseas economies and trends •The Indian footwear retail market is expected to grow at a CAGR of over 20% for the period spanning from 2008 to 2011. Footwear is expected to comprise about 60% of the total leather exports by 2011 from over 38% in 2006-07 •Growing middle class and growing buyer power leading customers to look for branded shoes. •seasonality issues – sports is more of a rage in summers •Lack of targeting of market segments for kids and women Social

lifestyle trends – upward shift
demographics
consumer attitudes and opinions changing favourably towards branded shoes •media views
consumer buying patterns
fashion and role models
buying access and trends
advertising and publicity
Technological
Competing technology development
India offers benefits like low cost of production, abundant raw material, and a huge consumption market •research funding in design and requirements
manufacturing maturity and capacity
information and communications
consumer buying mechanisms/technology
innovation potential
technology access, licencing, patents

Porter’s Five Forces in the Indian Shoe industry

Reebok or Nike operates in the ‘upscale’ segment of the Indian footwear industry. This segment was analyzed using the Porter’s Five Forces model. For this, the five forces in the industry were identified: -Buyers – The buyers are sportsmen,...
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