Future Group has exited its joint venture with US lifestyle and footwear brand Skechers, which will now run the Indian operations independently. Though the company didn’t disclose the deal size, it is believed that Skechers paid nearly Rs 580 crore for the 49% stake that it doesn’t hold in the JV.
Skechers, which entered India in 2012, has been doubling its business with plans to add its own manufacturing units and newer categories. Globally, the retailer sells watches, apparel, socks and sunglasses, among other merchandise. The brand has about 223 stores, including 61, which are company owned. An additional 80 to 100 stores are planned for 2019—of which approximately 20 will be company-owned, company-operated.
“The effort of our team has resulted in significant growth as illustrated in our year-over-year numbers — 2018 saw double-digit increases in wholesale and retail sales and an 80% increase in pairs sold, reaching 2.7 million,” said Michael Greenberg, President of Skechers in a statement. The company believes that combining the experienced team and Skechers’ proven sales and marketing capabilities will allow it to grow the brand and its presence in a faster, more efficient manner, ultimately meeting its fullest potential. The Skechers India subsidiary will continue operating under its existing structure and from its existing headquarters location in Mumbai. “Skechers is still a relatively young brand in this country, having been in India for less than a decade, yet in the last five years, we have seen significant growth through our joint venture,” stressed Michael. “The substantial existing retail network of over 200 stores, a strong wholesale business, and a recently launched e-commerce site is a solid foundation that we can build upon. These accomplishments, as well as opportunities we see to increase the brand’s exposure and drive sales, give us great optimism and confidence for the growth of Skechers in India.”
According to Rahul Vira, CEO, Skechers South Asia, “Skechers in India has achieved great success over the past few years. As we look into the future, we are delighted to be a wholly-owned subsidiary of Skechers. This development will enable us to amplify our growth plans, accelerate the expansion of our operations and build a stronger network to further gain market share in India.”.
According to David Weinberg, chief operating officer of Skechers, few markets match the potential for growth of India, which is why the company entered the market initially, and why it recently decided to purchase the minority stake in the joint venture. “The effort of our team has resulted in significant growth as illustrated in our year-over-year numbers—2018 saw double-digit increases in wholesale and retail sales and an 80 percent increase in pairs sold, reaching 2.7 million. We believe the strength of our diverse product and our marketing insight will help expand our product offering in India. As a subsidiary, we will be able to leverage our capital, product, logistics, and business model to better maximize our brand exposure to the 1.3 billion consumers in this country,” added Weinberg. Skechers is a $4.64 billion global leader in the performance and lifestyle footwear industry, Skechers USA, Inc. designs, develops and markets more than 3,000 styles for men, women and children.