Research Team: Arpita Mukherjee, Tanu M. Goyal, Ramneet Goswami, Divya Satija & Amrita Gupta
Commencement: April 2009
Completion: November 2009
Funded by: Italian Trade Commission
India is a sourcing hub for sports products for a large number of foreign brands. At the same time, with the high GDP and per capita income growth, India has become one of the fastest growing markets for sports goods retail. The country is hosting a series of international sporting events, which will provide a further impetus to this sector. The government is examining the possibilities of liberalising the FDI regime for sports product retail.
In this context, this study examines the sports goods sector in India, focusing on the opportunities and constraints for foreign, especially Italian, retailers and brands. It provides an overview of sports policy, the role of federations, the production structure, distribution, trade, retail and consumption patterns. It also looks at the practice of sport in the country, existing facilities, fashion and branding, fairs and promotional events etc., to assess the market potential for Italian and other foreign companies in India. A primary survey of over 371 stakeholders including different government departments, federations, sports manufacturers, retailers, wholesalers, and consumers forms the basis of the study.
The study finds that sports goods retail is a niche retail segment in India, expected to grow at 20-25 per cent annually over the next three years. Although this market offers immense opportunities for foreign players, they need to reorient their products and marketing strategies by associating themselves with popular sports for greater market penetration. The present FDI restriction is not an entry ban it only constrains the ability of foreign retailers to choose the most preferred mode of entry. Indian manufacturers have also focused on exports, almost to the exclusion of the domestic market. The study emphasises the need to develop strong brands and an integrated supply chain that would help exploit scale economies and market them globally.