SPORTS RETAILING

By:Bhupendra Singh

Introduction• The sports goods industry in India is nearly a century old and has flourished

due to the skills of its workforce. Being labour-intensive in nature, the industry provides employment to more than 500,000 people

• India’s sportswear market has evolved from a niche segment, which was exclusively aimed at sportspersons, to a burgeoning consumer sector. The industry has witnessed rapid growth over the past few years, driven by growth in income levels, changing lifestyles and the entry of foreign players after liberalization.

• The ever-increasing popularity of cricket, combined with the growing interest in sports such as football, hockey and tennis, has contributed to the growth of the functional sportswear market in the country.

• In addition to this, the trend of using sportswear as casual wear has expanded the definition of target consumers for leading brands. Some brands also offer collections to cater to this demand for casual wear.

Market Overview • The sportswear retail market in India is estimated at INR365.8 billion and

is expected to grow at 33% during 2010–2014. The market includes sports apparel, footwear and accessories, with footwear being the largest segment, accounting for around 60% of the total market.

• The country’s sportswear segment is largely unorganized with organized players constituting only around 30% of the market. Franchised exclusive brand outlets (EBOs) and multi-brand outlets form the core retail channels for sportswear in India.

Overview of Sport Sector in India

• Constitute 6% of total retail market• In total sports market around 30% is organized • Manufacturing growing at 10%-12% • India ranked 1st among 30 emerging markets for sports in 2009• Among largest sports goods manufacturers In Asia after China and Japan • Sports retailing under went massive change since1995• Developed countries: negative growth • Fastest growing markets: Middle-East, Africa and Asia • Focus is China and India

Cont…• India is hosting international sporting events • Retail sector in India is undergoing change • Government is considering allowing FDI in less sensitive sectors like

Sports • High growth sector • Growing interest among foreign sports retailers

Sports Retailers

Online Retailers

• Today, the organized sportswear market in India is dominated by the “big four” (Adidas, Reebok, Nike and Puma) global players, which have over 80% market share of the organized market, with several others such as Fila and Lotto ramping up their presence.

• Amazon is the world’s biggest online retailer for sporting goods department where all the equipments and goods can be ordered online.

• Difficult to estimate market size • Small part of total retail –niche market • Organized sector share in total sports retailing (30%) is much

higher than organized sector share in total retailing (6%) • Sports shoes has highest share –around 60% • Premium branded sportswear market: Rs.40-50 billion –

Reebok largest player• Bulk of the corporate retailers concentrate in large cities but

established players such as Reebok and Adidas are now penetrating into Tier II and Tier III cities

How International Sports Markets Work?

Why India and China?• Large unsaturated markets • Positive and high growth of GDP • Growing middle class and the young population • Two countries are organizing major sporting events since 2008 -increased

the government and private sector focus on this sector focus on this sector • Growing health and fitness awareness, brand awareness • Sourcing by foreign retailers • Conducive policy changes

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