NEW DELHI: Indians are spending more on shoes with the average price point increasing 10-15% in the last one year, said Rajat Khurana, Managing Director, ASICS India and South Asia.
The Japanese sportswear brand, which competes with Adidas and Nike, has 111 outlets across the country and expects this number to go up to 200 by 2026.
“The average price point of our shoes when I compare it with 2023 has increased by 10-15% despite no major uptick in retail prices. It is consumers who are shifting to the premium segment,” Khurana told TNIE.
Bullish on India, ASICS expects its sales here to grow by 26-27% in 2024 and then at a CAGR of 30% over the next 3 years. “The global management believes in India, because of its growing population, high disposable income and growing culture for fitness,” Khurana, adding it is a very promising market.
The MD also informed that ASICS has now achieved 30% local sourcing norms and as per existing FDI norms they can now open company-owned outlets here. The first of such outlets will come in the next 24 months.
“We plan to take localisation to 35-40% in the next 2-3 years. This 30% of the production caters to the low to the medium price point and our more premium products are still imported. We hope India will soon get the technology to produce high-end shoes,” said Khurana.
He added that they won’t be increasing their prices in tandem with an expected GST rate hike. The Group of Ministers (GoM) recently proposed to increase the GST rate on shoes costing over R15,000 from 18% to 28%.
“If the proposal is implemented, we will take some hit and not pass all the price hikes to the consumers. Our lowest price point is R4,999 and goes as high as R21,999,” he said.
On demand coming from tier 2 and tier 3 cities, Khurana said that he could have never imagined 9 years back getting such a strong demand beyond metro cities. About 60% of ASICS stores opened in the last one year are in tier 2 and tier 3 cities.
Khurana also said that performance-oriented running shoes are growing at a faster pace than the industry and account for 55% of their total sales. The company recently reintroduced the SportStyle Skyhand OG sneakers after a gap of 30 years to increase its presence in the sneaker segment.