Footwear

(India)
REVIEWING SALES & DISTRIBUTION
MANAGEMENT FOR PERFORMANCE
IMPROVEMENT
Submitted by
Aman Pasari 15BM60052
Tushant Juneja 15BM60006
Sidhartha Sankar Nanda
15BM60007
 Introduction

Leader in footwear industry

5 factories, 2 tanneries located throughout India
Current market share 40%
Products Shoes, Chappals, Sports shoes, Sports sandals, Hawai
chappals and other accessories
Multi-brand retailing

Problem Statement: Suggestions to arrest the dwindling market

shares (60% to 40%) and reverse the trend
Approach to the Problem

The Profitability of Footwear (India) Ltd. could be restored

and market share increased via

Profit can be increased by reducing expenses and increasing

sales
Market share must increase to increase the profit
Suggestions (1/4)
The existing fixed commission of 2.25% of sales of a retail store for everyone
should be removed and new commission system must be put
Implement quota system to push sales people achieve their targets
Thus, we suggest the implementation of a salary plus incentive system
to make sales people work harder for incentives
Under this system, there shall be a fixed commission a variable
commission of thereby increasing earning opportunity and hence helping
boost motivation
This would increase the morale of the sales people as they would get their
due incentives for the efforts they put in
Suggestions (2/4)

Each store would have to prepare a quarterly profit and loss statement
exclusive to the store
Based on the profits and loss statement as well the customer feedback, each
store will be assigned a rating
A leader-board of stores will be maintained and displayed in the back office of
each store
Employees of the highest rated stores in each state will be given non-
monetary perks
The employees of the highest rated store on the national level will be given a
special award and monetary benefits
This shall motivate the salesforce and induce a healthy spirit of competition
Suggestions (3/4)

Footwear India must follow a differential channel strategy.

The network structures A and B indicate that network A has a higher fixed cost
component in comparison to network B. Thus, using network A in rural areas puts
immense pressure on the already slim profit margins on the cheap low end
products, often returning a net loss
Thus, we suggest that low margin and cheaper products must be sold
through Distribution Network B to rural markets and higher margin
products through Distribution Network A to urban markets
To ensure that wholesalers push our product to the lower tiers, relationship
marketing or partnerships must be considered.
Store-wise focus Premium brands like Nike, Reebok etc. only at Main and
Commercial stores and push own mid to low level products at family and discount
stores
Suggestions (4/4)

Footwear India should consider creating a premium private label for its high-
end footwear.
A premium private label would certainly have a higher profit margin than
other premium footwear brands.
The salesforce must be trained so as to push the in-house brand over the
other brands.
Detailed in-store premium branding of the private label must be done,
positioning it as an elite product in the minds of the affluent urban customer
Customers loyal to the private label would become definite repeat purchasers

*
THANK YOU!