Top Italian shoemakers eye India for production base

Keeping the high product costs incurred by their production

houses in Europe, many high-end and super-expensive Italian shoemakers are looking at India to shift their production base. What’s also egging them on is growing demand and low cost of production in India. These premium luxury Italian footwear brands are also scouting for domestic partners.

Leading brands such as Baldinini, Loriblu, Giovanni Fabiani, NeroGiardini, Janet & Janet, Fabi and Fratesi are increasingly finding the Indian market more lucrative than their home market. The brands find demand growing in India for their footwear which may cost anything between Rs 29,000 to Rs over a lakh a pair.

They find labour costs in India lower compared to the West. They are also exploring markets in BRICS (Brazil, Russia, India, China and South Africa), where the raw material cost is lower than the European countries. Analysts say China could give competition to India in this respect, but India has advantage in terms of cost of labour.

Around 40 high-end European leather and footwear brands, including those from Italy, Germany, France, UK, Spain and Austria are going to showcase their brands in the upcoming international shoes and leather accessories show – Expo Riva Schuh India from July 4-6, 2013 in Delhi.

The overall, Indian footwear market is estimated at about Rs 19,900 crores with a growth rate of 8-10 percent. The market includes casual, formal, semi-formal and sports shoes along with sandals for men and women. Men’s segment accounts for 59 percent of the market, while women’s segment contributes 41 percent. The overall share of organised retail is 20 percent and is expected to reach 25-30 percent by 2015. Of the total market, super-rich market may constitute only a small portion, but Italians believe that it would still be higher than demand for their products in Europe, facing low economic growth.