Mumbai, June 10:

Footwear major Liberty Shoes has decided to stay away from the premium market and plans to target its brand for the masses primarily in the non-metro markets.

It had tried to enter the premium segment in 2004 through its format Revolutions. It was also planning to tap into the premium segment through its joint venture with the Future Group through the Pairs format, which subsequently got dissolved.

Anupam Bansal, Executive Director, Liberty Group, said, The potential of the premium footwear market is not that large even today. We realised that spending power was missing beyond the big metros such as Mumbai and New Delhi. While Liberty continues to have its Revolutions format, the merchandise mix is skewed towards the mass segment. Having experimented with certain premium formats, we have decided to be in the value segment with a special focus on tier 2 towns which are more developed markets for this segment.

Steep rentals in the metro markets have also forced the footwear company to venture into smaller markets. Even in a big metro such as Mumbai, Liberty has leased out its store in prime properties such as South Mumbai and is restricting its stores to malls in the suburbs.

Being a pioneer in the franchise model, today the Liberty Group has three retail formats: Liberty Revolutions, Liberty Exclusive stores and Liberty Factory Store.

However, it is not in a hurry to rope in a partner with FDI in retail being allowed. We have spoken to a few brands but have been slightly cautious regarding a partner. We do not want an MNC piggybacking on us unless there is a missing gap in our portfolio where it can add value in terms of fashion or technology, said Bansal.

Currently, the Liberty Group is in the process of restructuring its operations with its retail company (Liberty Retail) being merged with the flagship manufacturing company Liberty Shoes. Since most players are losing money in retail, there is going to be significant cost saving through the merger of these companies as we will now only manufacture what we sell, said Bansal.

It has roped in Vector Consulting, a Mumbai-based consulting company, to work on a low inventory model to reduce costs significantly for the footwear company.

The 30-year-old brand has been restricted to the northern markets. Almost 70 per cent of our sales still come from northern markets. It is not easy for footwear retailers to penetrate regional markets even in the west where there are already strong brands such as Regal and Metro shoes which continue to dominate, said Bansal. The organised footwear category is estimated at Rs 20,000 crore and growing at 15 per cent.

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Being a ‘mass’ brand fits our size, says Liberty Shoes