The company is aiming to open six exclusive stores and over 20 shop-in-shops by the end of calendar year (CY) 2024
Bengaluru:Â European shoe-making company AstorMueller is aiming to launch upto 50 retail stores in two to three years in India with an ultimate goal to reach out to the top 20 cities of the country with exclusive brand outlets (EBO) and shop-in-shops, a top company official told IndiaRetailing.
AstorMueller’s journey began in 1928, in a workshop in Schwelm, Germany. Today, It has a transcontinental administrative presence with offices in Switzerland, Romania, and India and has a 400-people strong team. The company has a presence in 40 countries across the world. It has more than 15,000 points of sales worldwide and is selling 7 million pairs annually.
AstorMueller owns brands including women’s footwear brand Bagatt, sneaker brand Nubeat and the sustainable shoe brand Elwin as well as holds the exclusive license for shoe brands such as Bugatti, Daniel Hechter and Salamander.
The company acquired the exclusive global license for Swiss brand Bugatti shoes in 2000, Paris-based Daniel Hechter shoes in 2014, and German-based Salamander in 2023.
Presently, AstorMueller retails Bugatti, Bagatt, and Nubeat brands in India.
It brought Bugatti and Bagatt to the Indian market in June 2023. Today, Bugatti has six stores in the country located in Hyderabad, New Delhi, Gurgaon, Pune, Indore, and Bengaluru. Some of these stores also retail Bagatt products.
Recently, AstorMueller’s exclusive sneaker brand Nubeat, came to India in partnership with e-commerce giant Myntra, in April this year. AstorMueller also retails its brands through multi-brand retailers such as Centro, Regal Shoes and Folio.
In an interview with IndiaRetailing, Sandip Kanti Baksi, chief operating officer of AstorMueller, discusses the footwear specialist’s strategies tailored for the Indian market, long-term targets, insights into the industry outlook, and various other topics.
Edited exerpts…
How does AstorMueller’s market in India differ from global markets?
There are two major differences between our primary European market, which is our home, and the Indian market. First is the age bracket. European customers are far higher in terms of age, where we typically target customers beyond forty, whereas in India it’s about ten years lower – around the bracket of early thirties, early to mid thirties.
Second is the climatic conditions. Since Europe has a cold environment, we sell a lot more boots or closed shoes there compared to India. The demand for open shoes, such as sandals and thongs, is significantly higher in India due to factors such as the country’s warm climate and the practicality of such footwear in everyday life.
Where are the products designed and manufactured?
The headquarters of AstorMueller is situated in Switzerland. The company operates manufacturing setups in Portugal, Romania, China, Taiwan, Vietnam, and India.
In India, the company has two manufacturing units located at Ambur in Tamil Nadu and Agra in Uttar Pradesh. We also has tie ups with a couple of sourcing factories and partners across South and North India. Some of the designing takes place in India, though the majority of our design team is based in Europe.
How do you incorporate tech in business?
Our tagline is ‘tech meets shoe excellence’. The usage of technology is in every part of the business right from the design phase. Today we have even started using artificial intelligence (AI) to design our shoes because it helps us come up with new versions of our very successful products.
We also are using 3D printing for our soles, which helps us to save cost and come up with multiple versions of the same products without actually getting into the molds and the entire architecture that is required. On the retail side, we are seriously exploring virtual retailing, though not launched as of yet.
Where is your primary investment directed within India?
Our primary focus for investment will be on expanding our retail footprint. Each of our stores requires a considerable amount of investment.
Current retail expansion goals for India?
In terms of expansion, we would like to reach out to the top 20 cities of the country as quickly as possible with our exclusive stores and shop-in-shops. Within the next three years we definitely would have stores in all top cities of the country. Primary focus is on metro cities because the brand is strong there compared to tier 2 cities.
Our current network consists of over 50 shop-in-shops along with our six mono-brand stores. We are aiming to increase this number by 50% over the next quarter.
In terms of multi-brand retailers in India, we are in the process of collaborating with Shoppers Stop. Although the business has not yet commenced, it is in the works and will be launched very soon.
We aim to open an additional five to six stores by the end of this year, and to increase our shop-in-shop count to about 70. Moreover, we plan to expand our e-commerce reach, as this sector has been performing exceptionally well for us.
For the time being, we are committed to open stores in malls. We anticipate having around 40 to 50 stores within the next two to three years. Our future plans also include opening stores exclusively dedicated to Bagatt.
Will you be bringing more brands to India?
We are in the planning stages to introduce the 120-year-old German leather footwear brand, Salamander, to India likely within the next fiscal year.
Any plans to enter new global markets?
We are presently exploring Southeast Asian markets, including the Gulf Cooperation Council (GCC). Our operations have already commenced in Bangladesh, and we are in the process of planning to enter Nepal and several Gulf countries soon.
Do the store sizes in India differ from those in the global markets?
Globally, our stores tend to be slightly larger compared to India, ranging from 1,800 – 2,000 sq. ft. In India. Our store size in India currently averages around 1,000 sq. ft.
Considering our product portfolio, we aim to have slightly larger spaces ranging between 1,200 – 1,500 sq. ft. However, the challenge lies in securing the right locations with availability.
Financial expectation for FY25?
The European market is currently facing numerous challenges, leading to a muted outlook. Therefore, our focus is on maintaining our position in India. Looking at the recent quarter, our performance has been robust, and we anticipate delivering a growth rate of at least 50% compared to last fiscal year, if not, higher.
As of now, we are selling about 100 to 150 pairs on a normal day in India, which marks a substantial increase compared to last year when we were not even selling ten pairs a day on average. This jump reflects our growing success and market penetration.
Where do you see the Indian footwear market in two to three years?
The past seven to eight months have been lackluster for the industry. Last Diwali didn’t see a significant boost in sales, which is unusual for the typically strong sales period from September to December. This year’s responses have been similar. Sales saw a slight increase in mid-March and April but have slowed down again. The market is currently experiencing fluctuations.
After the upcoming elections, I expect the new government to implement measures to stimulate the economy. There is substantial potential for growth for our brand and the market as a whole, considering that the number of footwear pairs per capita in our country is less than a tenth of that in any major economy.
One major advantage for the industry is local sourcing in footwear. As the Bureau of Indian Standards (BIS) increases shoe production domestically and importing from China becomes increasingly impractical, it’s leading to a resurgence of production within India. This should substantially boost domestic manufacturing.
