The surge in demand for fitness wear and sports equipment due to recurrent COVID outbreaks is boosting Puma’s revenues in India.
Last December, the brand’s revenues surpassed that of footwear brand Bata India. Sales surged ahead of sports retailer Decathlon and apparel brands Hennes & Maurtiz (H&M) to Rs 2,044 crore, as per the latest filings with the Registrar of Companies.
Puma also expanded its retail network, product portfolio and local supply chains last year. In all, it sold 1.2 lakh pairs of footwear and opened a new store every week to take the total outlet count to 411. Puma’s e-commerce sales too increased to 43 per cent of total sales from 25 per cent in 2019.
COVID disrupts production, supply chain
India is one of the largest markets for Puma Group however, the brand’s operations in the country were affected by the mandatory shutdown of factories in July-October due to a surge in COVID-19 cases. The surge in COVID cases also created a supply crunch for Puma as manufacturing hubs remained closed, fuel costs increased and laborers migrated from their workplaces. This further fuelled the company’s operating costs.
New partnerships to boost local sourcing
Puma has also been investing in local manufacturing that helped the brand increase its local sourcing to 40 per cent last year. It has built strong partnerships with Indian manufacturers to reduce dependence on global supply chains, says Abhishek Ganguly, Managing Direcfor, Puma India.
For footwear brands like Puma, Adidas and Nike, India is one of the fastest-growing and largest international markets. They have grown their business by partnering cricket and other sporting activities. However, many of these brands have also shifted focus to lifestyle and regular athletic wear.
Fashion demand from smaller cities to surge
Sports culture in India is growing faster compared to a few years ago. The country has a huge population below 25 years and it is likely to see an increase in demand for fashion products, especially from smaller cities, opines Ganguly.
Interest in traditional sports like Kabaddi, soccer, volleyball, hockey and badminton has also been rising.
The country now hosts professional leagues in most of these sporting disciplines. It has also partnered with cricketers KL Rahul and Virat Kohli besides making investments in Indian hockey, athletics, and soccer.
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