It would be seen from the above statistics that India's export of footwear and sub-components has increased from Lire 3174 million in 1990 to Lire 12706 million showing an increase of 300%. Apart
from a considerable decrease in 1994, there has been a constant increase in Indian exports of
footwear to Italy. Latest statistics for the period Jan - Oct. 98 further reveal an increase of
14.80% over the same period in 1997.

VII ITALIAN TRADE ASSOCIATION

ASSOCIAZIONE NAZIONALE CALZATURIFICIITALIANA (ANCI)

VIA DOGANA, 1

20123 MILANO

TEL 0039 2 809721

FAX 0039 2 72-20112

VIII. DISTRIBUTION AND MARKET CHANNELS

Importers / agents / wholesalers / department stores import directly and sell through the retailers and specialised shoe shops.

There are over 16000 outlets to sell footwear in Italy. These are scattered all over Italy. However, larger concentrations of outlets are in the following regions of Italy.

IX. MARKET INFORMATION

Since, Italy is well known for tanning of leather. The locally tanned leather is basically used for
manufacture of up-market shoes that are in turn exported, of course a small percentage do
find its way into the Italian market. Among the Asian countries, South Korea, Indonesia and
Thailand are three major exporters of footwear to Italy. Due to low cost labour , some Italian
manufacturers of footwear have shifted their production plants to countries like Indonesia and
Thailand with buyback arrangements. This factor has resulted in much larger exports from
these countries as compared to India.

Based on studies and discussions with Italian dealers / agents, it has been found that India is
known for export of raw leather and semi finished leather, but it is not considered a reliable
supplier of shoe uppers due to problems related to quality control, leather tanning methods
adopted and delays in delivery schedules. Of course of late there are a number of Indian
companies that have graduated to supply to the quality conscious Italian importers. Italian
importers pay lot of attention to the selection of raw material to be used for footwear. Next in
priority comes production methods adopted. Tanning and finishing is another area that Italians
are not ready to compromise. In our interactive with some of the importers/agents the following
points emerged:

• High degree of craftsmanship is expected and Indian exporters should strictly adhere to importer's samples and design.
• After tanning , the leather should be softened in a softening machine.
• Actual supply should match the samples and designs approved by the importers / agents.
• Countries like Indonesia and Thailand offer better quality products at cheaper rates than India.

1. Some Italian and India companies have joint venture collaborations in the field of footwear.
   Since Italians enjoy high reputation internationally in this field such tie-ups should be further encouraged so that our products could benefit from the Italian technology, design and high
   quality standards.
2. Indian manufacturers and exporters should also participate in Italian trade fairs to get acquainted
   with the latest fashions and designs .
3. Our exporters should also stick to the delivery schedules and quality standards as agreed at
   the time of signing the contract.
4. It may be worthwhile to study the experience of Indonesia and Thailand for possible emulation
   in India.
5. Those Indian companies that are keen in penetrating the Italian market are requested to visit
   the industrial clusters in Marche, Toscana, Veneto and Lombardia. The Chamber of Commerce
   in these Provinces can assist Indian exporters in arranging visits to major companies.

XII. RECENT TRENDS IN THE ITALIAN MARKET

1. Amongst the young generation shoe uppers made out of fabrics and canvas is quite-popular.
2. Sale of Study and heavy soled leather footwear as compared to traditional Italian crafted
   shoes is catching up.
3. An increase in demand for casual shoes at the cost of traditional Italian walking shoes has
   been noticed of late.
4. Italian consumer has become cost conscious and is ready to buy cheaper shoes.
5. Sales of sport shoes are enjoying a boom both with leather and synthetic uppers.
6. Slippers and other indoor footwear with all kinds of upper and soles including cloth, jute,
   straw, rubber, plastic and cork are also becoming increasingly popular.

THIS REPORT HAS BEEN PREPARED BY THE EMBASSY OF INDIA , ROME , COMMERCIAL WING.