SIMRAN RAWAT

TABLE OF CONTENT Pg No.

01 Acknowledgement (01)

02 About the brand (02-03)

03 Rationale, Marketing Mix, SWOT (04-06)

04 Retail and Management (07-34)

05 Customer Relationship Management (35-46)

06 Leadership and OB (46-49)

07 Economics (50-63)

08 Conclusion (64)

09 Referencing (65)
ACKNOWLEDGEMENT

In the competition of this project successfully,

I would like to express my special thanks and gratitude to all
my teachers Ms. Sunita Konwar, Ms. Gargi Datta, Ms. Priyanka
Aggarwal, and Mr. Anshuman, for giving me the exposure and
opportunity to do this wonderful project on the international
brand Steve Madden, which helped me enhance my
knowledge by practically implementing the concepts taught
to real-life examples around me. Not only collecting
secondary data but also gathering primary data and most
importantly analysing it for better outcomes and possible
profitable solutions. I would also like to thank my friends
who helped me stay motivated.

01
 Segment: Competitors:
Target Group: Lifestyle ALDO, GUESS
18-35 and Retail Macy's
Young individuals
from upper middle Positioning:
and upper class. Category:
Delivering trend right
designs to customers
Footwear and
consistently Accessories

ABOUT THE BRAND

CEO: Edward R. Rosenfeld
Creative Director: Matthew Ellenberger
With Madden currently serving as the founder and design chief.

Vision
INSPIRED BY ROCK AND ROLL AND HIS NEW YORK ROOTS, STEVE MADDEN’S VISION
IS TO PROVIDE ON-TREND SHOES THAT EXPRESS THE WEARERS’ INDIVIDUALITY.

Mission
“OUR MAIN MISSION IS TO CONSISTENTLY DELIVER TREND RIGHT DESIGNS TO OUR
CUSTOMERS. TO FURTHER BUILD OUR BUSINESS, WE WILL LEVERAGE OUR
TREMENDOUS BRAND EQUITY, DOMINANT POSITION IN FASHION-FORWARD
FOOTWEAR, AND INDUSTRY-LEADING DESIGN TEAM AND WILL WORK TO ENSURE
THAT STEVEN MADDEN, LTD. EMERGES AS A GLOBAL LIFESTYLE BRANDED COMPANY.”

USP
INNOVATIVE COLLECTIONS WITH INNOVATIVE MARKETING

02
Currently, the business is utilizing  the
influence of fashion as a worldwide force for
good by pioneering the development of
sustainable products. Even though this
project is still in its early phases, we
are committed to using superior materials in
our shoes and  minimizing  carbon emissions
CSR
across our supply chain, packaging chain, and
recovering used goods after they have
completed their intended use.

03
 1990

Madden started the

RATIONALE
company with $1100 by
1991 selling shoes out of the
trunk of his car.
Steve Madden
introduced the chunky
1993
platform shoe whic
Marry Louh The company went public,
raising about $5.6 million in
net proceeds by selling 1.725 Why Steve Madden?
million shares at $4 each.
He opened his first retail Steve Madden, the brand was born
1996
store.
with passion. The twisted turns and
Steve Madden printed
his first ad. history the brand arise from is
1997
definitely something worth knowing.
Madden and Belfort had had a
falling-out in 1997, and their Steve Madden has revolutionized the
1999
disagreement mushroomed into
a lawsuit.
shoe industry, merging years of
Net sales rose to $85.78 experience with unique and creative
million and then nearly
doubled to $162.04 million. designs. The brand excels in
2000
innovation. Each pair has its own
Founder's Arrest.
unique name. What doesn’t sell gets
2001
marked down quickly. The brand
Steve Madden Men's
collection was launched started coming together in the
in this year. 2003 1990s, The time of Fashion and Music
The new ad campaign
(Grunge).
2005 was released.
I consider Steve Madden a brand that
Steve Madden went global!
Steve Madden opened his comes with Boldness and excitement.
100th store in the US. Madden
Girl was launched. 2011 First big investment in Madden's was
Entered the Indian made by Jordan Belfort, the wolf of
Market.
the wall street.
2015
The founder Steve Madden works one
The company
reported net sales of on one with ex convicts as a mentor
$1.4 billion for 2015. 2021 and employer.
the company continues to
show growth year-over-year
reporting $1.9 billion in revenue
for FY2021.
04
Product
sells its products under 5 broad categories, and each of
these serves as separate product lines.
Variety: The option to select different colors on one style of
shoe.
Design: Every shoe is composed of different elements and
has its own “identity” that is exuded through the look of the
shoe.
Features:The brand produces a wide array of styles ranging
from slippers to high heels covered in sparkling gems. All of
the different styles provide different benefits to the
customer (comfort, style, fashion, warmth, protection, etc.
Promotion
It uses traditional media, which includes an advertisement on
television. It uses online and social media advertising, which is
cheaper and beneficial due to the increasing usage of the
internet.
It advertises on various social media platforms with a focus on
YouTube, Facebook and Twitter due to the high monthly
usage of these.
undergoes various sales promotion taking part in various trade
exhibitions and events around the year.
undergoes personal selling, with a large sales force to increase
its presence in retail stores.
Price
The current pricing strategy to set the price level that
follows is a competitive based pricing strategy.
sells its products at a higher price than competitors. It
currently uses product bundle pricing as well
List Price: Steve Madden uses decent list prices to attract
customers who value high quality shoes but do not feel the
need to spend extraordinary amounts of money at the same
time.
Discounts are often used by the Steven Madden company as
incentives for the consumers to buy.
Payment Period: For Steve Madden, the payment period is
immediate and there are no other options.
Place
Sells its products through two marketing channels. The first is
where it sells directly to its customer through its online
website. The second is where it sells to wholesalers who then
sell to different retailers located all over the country. These
then sell to its customers.
has a substantial amount of online sales with frequent traffic
on its websites.
It follows an omni-channel distribution system.
05
 STRENGTHS
Track record of innovation
High margins
SWOT
Talent management at Steven Madden and skill
development of the employees
Loyal customers and Good return policy
Operates out of stand-alone stores, alone
Seen as a fashion forward line
High brand awareness.
Its products have maintained
WEAKNESS
quality over the years and are still
valued by customers.
01 Niche markets and local monopolies
High cost of replacing existing experts
Intense competition & low global
presence means limited market share
Brand positioning in consumers mind as
dated or too expensive.
Business Model of Steven Madden can be
easily imitated by the competitors in the
03 Footwear industry.

02
OPPORTUNITIES
Global expansion especially growing
economies
Celebrity endorsers can give a boost to the
brand
Increasing product placement
Differentiating men’s line
Online expansion
Trend of customers migrating to higher end THREATS
products
Customer preferences are fast changing
Competitive pressures.
Kenneth Cole, Jessica Simpson, not
being able to save the brand from
decline.
Competitors catching up with the
product development
No regular supply of innovative
products

06
RETAIL FORMAT
One or two distinct categories are the emphasis of a specialty store. Their product selection
is quite limited. The benefit of a specialty store, though, is that you will find numerous items
linked to that specialty there that you may not find on the open market.

SPECIALITY STORE
Steve Madden falls under the category of a specialty retailer which has a limited selection of
products but a broad range of those products. Footwear (men, women and Kids) is the main
category it caters to along with accessories. It engages in adjacent and complementary
product areas.

07
 PRODUCT EXPERTISE

ADVANTAGES
Retail establishments can provide their workers with in-depth training
that equips them with thorough product knowledge if they concentrate
their sales on a certain product category (Footwear Handbags), in the
specific segment, these staff act as trustworthy sources of information.

PERSONALIZED CLIENT CARE

Specialty shopping is regarded as an upgraded experience that is
thrilling and rewarding. Specialty shops provide an unrivalled level of
client attention in addition to a welcoming atmosphere. Customers who
are passionate about a certain product are drawn. Customer demands are
addressed with genuine interest, which encourages customer loyalty.

HIGHER-QUALITY MERCHANDISE
Specialty shops target a niche market and offer a constrained selection
of goods. These stores concentrate on compiling a selection of top-notch
goods as a result. Customers view specialty stores as places to purchase
well-made, unique goods.

08
 SEASONAL SWINGS
DISADVANTAGES
Specialty shops may see major changes in demand, depending on the
nature of their product offers. When a product is out of season and hence
in low demand, there is more of a disadvantage for store owners than for
customers.

PRICIER PRODUCTS
Specialty shops are seen as being more expensive because they sell
things of a better standard. This is sometimes true since speciality shops
don't frequently order goods in large quantities at the same rate that
discount retailers do, resulting in greater costs that are then passed on
to the customer in the form of a higher price.

LESS CONVENIENT
Due to a lack of selection, speciality stores cannot satisfy all customer
needs, forcing customers to make purchases from other merchants to
finish their shopping lists. Some customers may decide to forego visiting
a specialist store in favour of a general goods retailer because they find it
inconvenient and not worth their time to shop there for just one specific
item. In addition to being harder to locate and taking longer to get to
than mass merchandiser locations, specialty stores are less common,
which may put off potential customers.

09
 PRICING
Premium pricing: Above competition pricing
A great way to boost sales and get a high profit margin to finally acquire a competitive edge
is by using premium pricing.

The marketing manager must choose how to position a new product in the market and what
price plan to employ when a company launches it. The target market, the product's price
point, its psychological reputation, and the amount of funding allocated for promotion all
play a role in the decision. One tactic would be to enter a market at a low price in the
beginning to gain a footing. On the other end of the scale, the premium price strategy
charges a high price for the good.

In order to establish its goods as a

high-quality product in consumers'
thoughts, a corporation could utilise a
premium pricing strategy.

When businesses aim to price their goods more than those of their rivals, they employ a premium
pricing approach. The idea is to make consumers believe that because the products are more
expensive than similar ones, they must be of greater quality. The business is making the assumption
that the customer won't do any research to determine whether the product is really of superior
quality. Marketing executives want consumers to think that the brand name alone is sufficient to
convince them that their product is superior to that of the competition.

A premium pricing plan offers the benefit of improving profit margins, strengthening barriers to
entry for rivals, and raising the brand's value across the board for the entire company's products.

Premium pricing pros Cons of premium pricing

Higher margins of profit Depending on the inelasticity of prices

Increases value and brand perception Limits the market's potential (the masses)
Create a moat around your company. Reduces price competitiveness

10
 CATCHMENT ANALYSIS
Catchment Analysis and recommendation:
Vasant Kunj is a posh area, so the high-
income group falls under the target
customers which is the high-income
class which is an advantage for the brand
store.
The store is not a stand-alone outlet
rather, it is situated in a mall. Moreover,
not only one mall but three malls
together increase footfall which is again
an advantage for the mall.
Even though having 3 malls can
contribute to higher footfall, this case
also increases the number of
competitors in the same vicinity.
Indian customers are price sensitive.
More substitutes and options for the
customers will be available. This will
increase the difficulty of customer
acquisition for the brand as there are
cheaper options of similar styles.
11
Operates out of stand-alone stores, alone
Fun and innovative promotions.
Its products have maintained quality over the years and are still
valued by customers.
High margins.
Talent management at Steven Madden and skill development of the
employees.
Loyal customers and a Good exchange policy.

14
STORE LAYOUT
Area: 500-600 sqft
COMBINATION OF FREE FLOW AND LOOP LAYOUT
PLANOGRAM

Sneaker grid wall Limit: 24 pairs each side since one box is for signage (unique styles)
with LED Screen in between and
handbag wall shelves below led. Limit: 3 bags in each row
And Inventory room door on the right.

REFERENCE PHOTOS

26
SIGNAGES

PROMOTIONAL
SIGNAGE

NEW COLLECTION

27
INFORMATIONAL SIGNAGE

28
 CLEAR
COLLECTION

INFORMATIONAL SIGNAGE

FALL COLLECTION
2022

29
STORE FACADE

30
COMPETITOR'S FACADE

31
ONLINE RETAIL PRESENCE

32
33
RECOMMENDATIONS
Signages:
More outdoor signages could be used to atrract the existing foot fall using these
LED advertisements spread across the promenade mall:

Since Indian Customers are price sensitive, so sorting styles based on price will
help customers to filter out and choose according to their budget.

Online Retail Presence:

Introducing their own app. Putting their products on more famous platforms.
Advertising their website to increase direct sales from the producer, leading to
fewer mediators and higher profit margins. This could also be done by launching
discounts exclusive to the website ONLY.
They could also run ads to cater to the Indian audience specifically. so the Indian
consumers can relate more to the brand.

34
CRM
SEGMENTATION

Market segmentation for consumers 

The two basic approaches to market segmentation criteria from a
research perspective are as follows:

1. People Oriented
2. Product Oriented

35
PEOPLE ORIENTED:
We may categorize  clients based on a variety of factors, including demographics,
location, and psychographics. The consumer market is segmented using these
variables. Here are some people-centered strategies:

Demographic: Geographic:
8-45 years old Urban areas
Gender: Women, Men, Kids Tier 1 cities
Income: High income group Climate/Weather: Since the
Fashion Enthusiasts merchandise consists of boots
Social Class (SEC): Middle as well, so both summers and
class to High class winters.

Psychographic:
Lifestyle and Personality

36
Majority will consist of Early adopters (in terms of boots) and early
majority to Lagards because a lot of designs of Steve Madden are sort
of knock offs of famous collections of high end luxury brands like
balenciaga, New Balance, Nike, Aquazzura, etc.

Here are some examples:

Steve Madden's

37
Steve Madden's

38
2. PRODUCT ORIENTED APPROACH
It is also known by the names buyer-behavior traits
or customer reaction approach. It could be taken
into account in regard to product advantages,
product applications, and brand loyalty. The
psychology of consumer behaviour includes
elements including attitudes, preferences, and
purchase motivations. These are briefly described
in this strategy as follows:

The readiness stage: Under this
step, we examine the degree to
which a customer is willing or
eager to purchase the good.
Buyers  may be interested in,
desirous of, or wanting to
purchase the product.
Product usage: The market may be divided into
segments based on usage trends. Users, non-
users, ex-users, potential users, and regular
users are all different types of buyers. Buyers
can be divided into three categories according
to volume and user status: heavy, medium, and
light.

Benefits sought: Benefit seeking is another crucial consumer behaviour trait. This
segmentation places a focus on the needs and wishes of the consumer. The existence of a
market sector is due to the benefits that consumers want. Buyer satisfaction is mostly
influenced by the advantages of the product, such as affordability, style, durability, taste,
quality, performance, warranty status, etc.

Loyalty Status: Market segmentation may be based on customer loyalty. The ability to segment
clients based on their level of loyalty allows marketers to create promotional materials and
products that will appeal to existing loyal customers, draw in new ones from competing
companies, or turn non-loyal customers into loyal ones. Measuring brand loyalty is a
challenging task for marketers. By having a thorough grasp of their customers' needs and
purchasing habits, manufacturers may build brand loyalty.

Market segmentation may be based on factors

related to marketing. It comprises the
product's cost, its quality, retail advertising,
etc. As a result, these criteria may be used to
determine market segmentation.

Attitude: A company may divide the market

into several segments based on consumer
attitudes. Enthusiastic, optimistic, neutral,
unfavorable, and hostile are examples of these
mindsets.

39
CRM STRATEGIES
Understanding the potential clientele of Steven Madden Ltd is essential for creating marketing
mix techniques that work. If the business comprehends the demands, expectations, and attitudes
of its customers, the strategy will be more successful. The thorough investigation results in the
classification of various client profiles or segments. Return and Refunds: No returns.
Exchange policy of 180 days.

Steps that can be followed by Steven Madden Ltd.

To start, Steven Madden Ltd needs to be very clear about who its existing and potential clients
are. At this stage, a large group of clients is discovered in order to categorize them into various
groups according to their goals, qualities, and attributes. Finding new clients can be more
difficult than finding existing ones.
The customer analysis ought to provide details on how distinct groups' needs and expectations
differ from one another and what factors may be at play.
As the last step, Steven Madden Ltd must examine how its products and services meet the
needs of various client segments and determine which of these segments has the greatest
potential for growth and profit. Steven Madden Ltd will use this information to create
consumer personas and profiles.

CAN I EXCHANGE MY ORDER?

We do not currently offer exchange of products. You may return the product by placing a return
request. But in India, they only exchange and dont take returns.

HOW DO I RETURN MY ORDER?

You may place a return request on the website or by contacting the customer care. A return
request needs to be placed within 30 days of receiving the order. For more details, refer to the
Return Policy

CAN I RETURN MY ORDER TO A STEVE MADDEN STORE?

No, we currently do not have this facility available. For all return requests, kindly place a return
request. For more details, refer to the Return Policy

HOW LONG WILL THE RETURN TAKE?

Please allow 7-10 working days from receipt of your goods at our warehouse for the return to be
processed. You will receive a confirmation email once your return has been processed with a new
tracking number for exchanged goods or a refund receipt.

40
OTHER FASCILITIES

STRATEGIES AND RECOMMENDATIONS

Competition to the cheapest price vs. loyalty
When you provide excellent customer service, you build a base of devoted customers who are willing
to pay more for the same goods.
Also, Steve Madden used to provide loyalty points but stopped after covid lockdown. They must
resume the same for better customer brand relationship.

While online shopping provides people with the resources to choose the merchant offering the best
bargains, Steve Madden discovered that pricing isn't a key consideration among their brand devotees.
Even if there were cheaper options available, customers would still purchase from Steve Madden D2C
because to an enhanced on-site experience and effective search optimization.
In the past, the business attempted to compete on price by giving out significant discounts. They now
only conduct promotions during significant shopping holidays like Black Friday or Labor Day,
emphasising relationship-building over price reductions. They need to increase since they get a huge
footfall with the help of sale in case of Indian Customers.

Customers prefer buying directly from Steve Madden because their wants are catered to  in the
consumer experience. On-site evaluations from previous customers are instructive; free and premium
loyalty  programs give interesting benefits, such as free two-day shipping and appealing discounts;
and desktop and mobile checkout are simple.
Thus, They should launch their own app. To increase brand experience using appropriate UI/UX.
Introducing their own app. Putting their products on more famous platforms. Advertising their
website to increase direct sales from the producer, leading to fewer mediators and higher profit
margins. This could also be done by launching discounts exclusive to the website ONLY.
They could also run ads to cater to the Indian audience specifically. so the Indian consumers can relate
more to the brand.
Additionally, Steve Madden changed the way it interacted with clients online, choosing to focus on
building long-term loyalty rather than short-term sales. "Gross margins on the site rose
considerably" after they switched their primary call to action from an email list sign-up to a loyalty
program.

41
HOW STEVE MADDEN RAISED IT'S SALES REVENUE BY TARGETING AND
ACQUIRING MORE CUSTOMERS THOUGH THE APP FYND IN INDIA

Customers visited the Steve Madden stores in large numbers. Top designs disappear from stores more
quickly than ever. Any #MaddenGirl you speak with will express her dismay at not finding that
particular style. Because of frequent stockouts of bestseller styles, stores were losing sales. There was
potential for a 6-8% untapped business. Although a certain size may not have been available in one
store, it probably was in at least two or three other locations. Processes for transferring between
stores were laborious. Customer satisfaction and experience were declining.
The issue was how to increase sales in the stores. The company had two options: it could have
streamlined the inventory, which would have taken a lot of time, effort, and money; or it could have
teamed up with a tech company.

‍ olution
S
Protect the Sale
On the Fynd Store app, Fynd integrated every item in every store's inventory. The entire Indian
inventory could then be practically stored in every store. If a consumer could not locate the
appropriate size or fit within the store, the goal for retailers was to save the transaction by making
purchases on the Fynd Store app. Therefore, whenever a store ran out of a specific SKU or other SKUs
that were not assigned to them, they would locate the closest fulfillment store of their preference
and place an order on the customer's behalf through the app. Additionally, improved knowledge
sharing amongst Fashion Consultants from various stores was made possible by teamwork on the part
of store workers.

42
OFFLINE CRM
VM PRODUCT FIXTURES SIGNAGE

Interaction with the brand representatives

(Staff/Employees).
From greetings and welcoming to identifying personal
product choices. Desired products are displayed.
According to the staff of Steve Madden stores in Delhi.
They lose customers once the price is conveyed as it is
higher for Indian Customers.

43
ONLINE CRM
WEBSITE
Attractive interface of the website.
Displays a separate category of best
sellers.
Supports to buy d2c. (Probably because
of high margins gained per product).

Steve Madden App: Not available.

Otherwise, negative reviews in terms of
service and exchange.

AJIO: TATA CLIQ Fynd:

Discounts, Cash on Delivery,
Easy Returns, and Exchange.
(Total products available:
1608)
TATA CLIQ LUXURY. This itself
says how Steve Madden in
India is considered but
worldwide it isn't.
Fashion e-commerce platform
Fynd has contributed 8-10% of in-
store sales to Steve Madden in
India.
(Total products available: 1100)

44
 EMAIL
MARKETING

FACEBOOK ADS, INSTAGRAM ADS, SMS MARKETING

GOOGLE ADWORDS (occasions and festivals)

45
INSTAGRAM

Instagram store shop

Collaborations to create
more brand hype.
Giveaway: Increased engagement

Software used for CRM by Steve Madden:

Steve Madden now uses

Bluecore to aggregate
both its customer and
catalog data into
meaningful campaigns.

46
LEADERSHIP AND OB
Name: Chris Age: 21
Been working at Steve Madden, Select City for
the last 5 Months.
Started as an intern and now works as a full-
time Fashion Consultant.

STORE RESPONSIBILITIES
OPENING DUTIES
Store Timings for the staff are 10;00 am to 11:00 pm.
Individual staff is assigned the duty of opening and
closing separately.
They can't open the store themselves, they have to wait
for the LPA who checks everything is going well, the
books are kept clean, and regulations are being followed.
Collecting keys. So the person handling the opening will
go inside while the shutter is half opened just for her, Get
the Visual merchandising ready, and the guard switches
on the lights.
She will access Steve Madden's system computer in the
backroom. The target for the day, informs others. At 11 am
the second person joins and that's when the shutter
opens completely

CLOSING DUTIES
Being handled by Chris and the store manager. 11; 00 pm
to 11:30 pm max. Collect the data of the day, post it in the
group, and analyze what they achieved and where they
lacked. The month's target gets updated. Similarly for the
weekly target. Data is recorded in the DSR (Modelling tool
for every store to track the performance.
Once done everything, before leaving the bags are
checked of the staff to make sure no one is stealing
anything. The keys are handed to the guard to close the
store.

47
 Group health insurance Appraisals given based on
(GHI) to 5 lacs. performance.

UNO Discount: 40% discount

on the merchandise upto
50,000
JUNO Discount: 60% discount
in the month of June
They work on base +
PERKS, COMPENSATION AND incentive/commission
REWARDS. based salary.

Provident funds: whatever incentives they have

that goes above 20k goes into provident funds,
some of it goes to their pocket.

Roles:
Handling Visual Merchandising
Checking the stock inventory
Getting rid of old collections
Even getting a shoe fixed on their end
Handling the billing counter themselves.

Membership and Loyalty Points:

No such membership.
Loyalty points were there before covid,
but they stopped it after covid.

48
RECOMMENDATIONS
Steve Madden is considered to be no.1 at Select City mall amongst it's
competitors like Charles and Keith, Dune London, etc. in terms of highest
sales. This I believe is the result of proper motivation. To give responsibility,
they must also give the authority and accountability for the tasks and targets
that the store and brand sets.

Employee turnover is a big drain for fashion retailers. Steve Madden must
inculcate more approaches to reduce the same. One of the biggest factors
for any employee is a consideration, monetary aspects, and validation. After
talking to Chris (as he was transparent about the people he works with and
procedures), I learned that his superior Shashank (store Manager) is inclusive
of his subordinates. Although I felt the salaries were lower than expected.

Comparative Analysis:
Charles and Keith send their employees (designers) to USA and Europe for
training. This is something that should be implemented at Steve Madden.
This will not only give better exposure but will also help employees
accomplish and connect their personal objective and organisational
objectives.

Better Workforce Management using faster Onboarding:

I noticed that a lot of employees' educational background was not of the
fashion business. Even though it is not wrong to choose the candidates who
are chosen based on their passion and interest in the industry, but this
increases the onboarding process by increasing the time of on-the-job
training because that is how they adapt. This can lag the sales of the brand as
a whole.

49
IMPACT OF INFLATION

As 2022's second half approaches,

garment companies are taking a beating.
As inflation is rising, industry leaders see
higher-than-anticipated operational costs
as having an impact on profits. A
challenging May earnings season
throughout the industry has been
followed by the reality of sustained
inflation, a more vulnerable consumer, and
the possibility of even more unstable
economic conditions as the Federal
Reserve works to control inflation. 1 Price
are increasing along the entire value chain,
including labor, commodities, and
transportation.
For instance, inflation in the US reached 9.1
percent in July, marking the highest 12-
month rise in more than 40 years.
India: The country's retail inflation, which
is measured by the Consumer Price Index
(CPI), dropped to a three-month low of
6.77% in Oct. 2022. CPI in the month of
September was 7.41% and 7% in Aug 2022

50
The Consumer Price Index for apparel and
footwear nationwide in March 2022 was 171.1,
up around 71 percent from the previous year
(2012). In urban India, the index for the same
products that month was 164.9.

Inflation's impact on the

fashion industry:
Since their pricing adjustments are more
elastomeric and their products are marketed
to consumers who have less disposable
income for discretionary spending,
mainstream fashion companies may be more
likely to experience the negative effects of
inflation in raw material costs, transportation
costs, and supply-chain disruptions.
The "primary issue" of the industry was "a crisis
in demand because individuals don't have
enough income" to spend on non-essential
items like footwear or leather goods, which are
the key clients for the industry.
The cost of fibres and technologies may climb
further as a result of the fashion industry's
inflation, creating a significant imbalance
between supply and demand.
Since Steve Madden imports a big portion of
the raw materials they use, the cost price will go
up by 9.8% as a result of the rupee's
devaluation, which has declined by around
9.8% since the year's beginning.

51
 The majority of nations have been exhibiting signs of rising prices since last year,
despite the Russian invasion of Ukraine having fuelled the inflation fire.
International food and fuel prices were rising throughout 2021, as seen in Figure 1,
as assessed by global oil prices.
According to current projections, inflation will rise even more in 2022, primarily as
a result of increased commodity costs and supply disruptions around the world.

The enormous pressure that inflation places on household disposable earnings is

one important factor. As indicated in Figure 2, the budget proportion of food and
energy costs in the consumer basket in LAC is over 40%, with Peru, Mexico, Brazil,
and Paraguay having the greatest amounts.

52
REVENUE CHUNK
This graph shows the total revenue of Steve Madden
USA
worldwide from 2014 to 2021, by geographic area. In Majority Chunk
2021, the total domestic revenue of Steve Madden
amounted to about 1.64 billion U.S. dollars. * Includes
revenues of 329,934 U.S. dollars, 249,235 U.S. dollars
and 333,704 U.S. dollars for the years ended 2021, INTERNATIONAL
2020 and 2019 related to sales to U.S. customers
where the title is transferred outside the U.S. and the Minor Chunk
sale is recorded by the company's international
entities

53
HOW INFLATION ON RAW MATERIAL WILL
AFFECT THE BRAND
Manufacturing of Steve Madden takes place in Mexico and Brazil.
Brazil, Chile, Colombia, Mexico, and Peru, collectively known as the LA5, had an increase
in inflation in 2021, as did other developing markets and developed economies. The rise
in inflation was initially caused by soaring food and energy prices, but it broadened as a
result of wage indexation practises (contracts that automatically adjust their terms with
inflation), monetary policy inertia, and a robust recovery in demand, initially for goods
but later for services as well.

With a compound annual growth rate (CAGR) of 9.5%, the global market for plastic and
rubber products increased from $1,229.98 billion in 2021 to $1,347.37 billion in 2022. At
least temporarily, the Russia-Ukraine conflict hampered the possibilities of a COVID-19
pandemic-related global economic rebound. Economic sanctions on several nations, a
rise in commodity prices, and disruptions in the supply chain as a result of the conflict
between these two nations have all had an impact on numerous markets around the
world. At a CAGR of 6.1%, the market is anticipated to reach $1,709.08 billion in 2026.

54
 INCOME EXPENDITURE EMPLOYMENT

IMPACT OF COVID

Industry’s “main concern” was “a demand crisis because people don’t have
enough income” to channel to non-essential goods such as footwear or
leather goods, which are the sector’s main customers.

The COVID-19 outbreak has significantly constrained the market for the
manufacture of plastic and rubber products in 2021 as supply chains were
disrupted by trade restrictions and consumption fell as a result of
lockdowns imposed by governments around the world.

Steve Madden's various distribution channels all had sales reductions, with
wholesale revenues down 13.0% to $302.7 million and retail revenues falling 15.8%
to $52.9 million. Since March, the Covid-19 pandemic has forced the closure of
every one of the company's retail locations outside of China.
For the first quarter of 2020 that ended on March 31, Steve Madden reported a net
loss of $17.5 million, or $0.22 per diluted share, as the company's sales were
negatively impacted by Covid-19-related shop closures. The group's net income
for the comparable period in the prior year came to $34.5 million, or $0.41 per
diluted share.

55
As we can clearly notice the dip in revenues in the year 2020. It was caused by covid as the
sales dipped because of the pandemic.

55
Income and Employment:

As the coronavirus issue continues to hurt retail in general, Steve

Madden Ltd. has become the most recent footwear business to
announce furloughs and compensation cuts, including those of its top
executives.

The New York-based shoemaker revealed in a statement with the

Securities and Exchange Commission that it will be laying off a
"substantial" number of employees as beginning April 1. On the other
hand, those who earn more than $100,000 year will have their pay
decreased in a gradual manner. Medical benefits will still be available
to employees.
Steve Madden, the company's creator and creative director, along with
chairman and CEO Edward Rosenfeld, won't get compensation, and
the salaries of the company's president, CFO, COO, and merchandising
director will be 30% lower. Additionally, the board of directors decided
to postpone all of its members' financial remuneration.
As states eased several COVID-19 limitations, many stores started to
open their doors, but store traffic is anticipated to remain low and
consumer spending has been hampered by sharp rises in
unemployment.

Output:
CEO of Steve Madden Edward Rosenfeld stated on a conference call on
Thursday that "even the plants that are open are not running at their
regular productivity," adding that only approximately a third to two-
fifths of its China factory workers had returned to the production lines.
Although the situation is undoubtedly unstable, they were anticipating
production delays of around three weeks on average.
The American footwear and clothing business Steve Madden has
moved roughly half of its women's production from China to Mexico
and Brazil as a result of supply chain difficulties in recent months.

56
MONETARY POLICY
E v e n t h o u g h S t e v e M a d d e n is a w e ll- k n o w n b r a n d w o r ld w i d e , r e l i a n c e
i n d u s t r i e s a r e r e s p o n s i b l e f o r m a n a g i n g t h e b r a n d i n In d i a . T h i s
i n d i c a t e s t h a t m o d i f i c a t i o n s t o In d i a n m o n e t a r y p o li c i e s w i l l h a ve a n
impact on the brand as well as on customers.

A n y c o m p a n y t h a t b o r r o w s m o n e y w i ll u n d o u b t e d ly b e i m p a c t e d b y
r i s i n g i n t e r e s t r a t e s , n o t o n l y f a s h i o n f o o t w e a r e n t e r p r i se s . H ow e ve r ,
b e c a u s e o f t h e c h a l l e n g i n g r e t a i l c li m a t e , f a s h i o n c o m p a n i e s w i l l f a c e
s p e c i a l d i f f i c u l t i e s i n m a n a g in g t h e i n c r e a s e s .
B e c a u s e t h e y a n t i c i p a t e c u s t o m e r r e s i s t a n c e t o p r i c e h i k e s , s h op s
w o n ' t w a n t t o a c c e p t a p r i c e i n c r e a s e t o o f f s e t t h e h i g h e r b or r ow i n g
rates.
I n o r d e r t o r e m a i n c o m p e t i t i v e i n t h i s c h a lle n g i n g r e t a i l c l i m a t e ,
f a s h i o n c o m p a n i e s w i l l n e e d t o b e d i li g e n t a b o u t t h e ir ow n c os t s ,
including being wiser with the money they borrow, strictly managing
t h e i r o v e r h e a d , a n d r e g u l a t i n g t h e i r i n v e n t o r y le v e ls .

Most retailers are closing down

stores, which means less chances
for producers and a potential
worsening of the situation.
M a n u f a c t u r e r s w o n ' t b e a b le t o
s h i f t t h e s e e x p e n s e s t o r e t a ile r s a s
they once may have because of the
decline in retail. When combined
with ongoing minimum wage
increases, supposedly these
m a n u f a c t u r e r s m a y p o s s i b ly f i n d
t h e m s e l v e s i n a h a r d e r c a s h - f lo w
situation.
In order to cover their greater
operational expenses, businesses
can find themselves functioning on
a smaller scale.

57
The rate at which the RBI lends money to banks is known as the repo rate. It is a
measure to control inflation and liquidity.
The Central Board of Directors of the Reserve Bank of India decides on interest
rates in India. The benchmark repurchase rate is the official interest rate. Price
stability replaced the government's borrowing, the rupee's exchange rate
stability, and the need to safeguard exports as the RBI's major monetary policy
goals in 2014. The government and the central bank decided to set a target for
consumer inflation in February 2015 of 4 percent, with a tolerance of plus or
minus 2 percentage points, starting with the fiscal year that ends in March 2017.
During its meeting in September
2022, the Reserve Bank of India
raised its benchmark repo rate by
50 basis points to 5.9%, marking
the fourth consecutive rate
increase. This move came amid
growing worries about spiralling
inflation, global headwinds, and
the fall of the rupee to record lows,
which was widely anticipated.

The choice came after an increase of 50 basis points in August, which had
brought the rate to a level last seen in May 2019. The central bank kept its FY
2023 inflation forecast at 6.7% while lowering its economic growth prediction
to 7.0% from 7.2%, with Q2 inflation at 6.3%, Q3 inflation at 4.6%, and Q4
inflation at 4.6%. The standing deposit facility (SDF), marginal standing facility
(MSF), and bank rates were all increased by the central bank by 50 bps, to 5.65%
and 6.15, respectively.

58
 Analysis and
recommendation
The business should search for measures to reduce its borrowing to assist
growing interest rates. Lowering inventory levels, obtaining shorter terms
on accounts receivables, extending the due date for payments made on
accounts payable, and, of course, keeping more profits in-house are all
potential ways that fashion manufacturers might increase liquidity in their
operations. All of these elements can lower a company's borrowing needs
and assist in keeping rising interest rates under control.

Those who extensively rely on short-term

finance to supplement working capital
will need to adjust their costing and
customer pricing as well as their balance-
sheet management in order to absorb
the additional expenses. Among the
tactics are increasing the turn of accounts
receivable, lowering inventory levels,
and/or negotiating better terms with
suppliers.

Operating successfully at the highest levels requires effective cost

management. Businesses must manage cash flow and, more
crucially, inventory control more effectively. Moving out-of-season
commodities quickly is necessary.
In order to sustain gross margins and bottom-line earnings,
businesses must constantly negotiate better prices with their vendors
and better purchasing conditions. Additionally, payouts should be
carefully controlled to help preserve capital and reduce the amount
that needs to be financed.

As we all know, the end game is the bottom line. Profits cure a lot of problems.

59
IMPACT OF
GST
On July 1, 2017, the Goods and Services Tax (or GST), a more simplified
manner of paying taxes, entered into effect. It must be followed by everyone
who participates in the nation's supply chain for goods and services. In order
to ensure uniformity in the indirect tax system, service taxes, income taxes,
and other taxes that were in force before to the implementation of the Goods
and Services Tax have been replaced.
Businesses are required to collect GST, an indirect tax, when they provide
goods or services.

REDUCED BURDEN OF COMPLIANCE

In the past, different agencies were required for the management of a variety of
indirect taxes, including Central Excise, entry tax, OCTROI, and VAT/Central Sales
taxes. All of these levies have been combined with the GST that was recently
implemented. The burden of compliance is now less for manufacturers. Textile
dealers can now focus more on business growth without having to worry about
challenging compliance requirements.

60
 The following footwear categories are subject to an 18% GST rate:
1. Shoes having leather, plastic, rubber, or composite leather exterior soles and
textile uppers.
2. A separate category of footwear with an outer sole and a top made of rubber or
plastic.
3. Goods of footwear (with uppers whether or not connected to soles); removable
insoles; and similar items such as heel cushions. Gaiters, leggings, and similar items,
as well as their component portions.
4. Waterproof shoes have rubber or plastic exterior bottoms and uppers that are not
sewn, riveted, nailed, screwed, plugged, or in any other way similarly bonded to the
sole.
5. Shoes with leather uppers and rubber, plastic, or leather outer soles or composite
leather.

SWOT ANALYSIS OF GST IN FOOTWEAR INDUSTRY

Strengths Weaknesses Opportunities Threats

Margin of wholesalers and • Branded footwear is • Bring competitiveness in • Unorganised sector

retailers will increase
• cascading taxes like turnover
tax, anti-tax, and number of
different taxes will go away
• Increase in transparency
across allied
• services & industries
too costly unorganized sector, • cheap Chinese
• limited presence of manufacturing & retail alternative
large-scale • rising level of disposable
manufacturing units income
• highly cash-intensive • international demand increase
• social media & e-commerce
• change in lifestyle

61
EXCHANGE RATE

The cost of imported goods is significantly influenced by exchange rates. You

will typically spend much more for international goods when your own currency
is weaker. As a consequence, a stronger home currency may somewhat lower
the cost of imports.

Through changes in the demand for exports and imports, the exchange rate has a
direct impact on the nation's real economy. Exports become more competitive
overseas and imports become more competitive domestically when the local
currency actually depreciates.

How the brand Steve Madden benefits from

exchange rate.

The brand is based in US meaning it has a good hold of the strong currency dollar.
Its's production takes place in Latin America ( Brazil and Mexico). So, paying off the
labours and infrastructure eases them as the dollar is stronger than Mexican Peso and
the Real.
The chief economist for the Footwear Distributors and Retailers of America, Gary
Raines, believes that a strong dollar could have a significant effect on the footwear
sector. To begin with, it might contribute to reducing the record-high costs of duties
and import fees on some shipments to the United States.
Due to the fact that purchases made abroad are less expensive than those made in
the U.S., consumers "should stand to benefit" from the current strength of the dollar.

However, poor foreign exchange rates are likely to be a barrier for American
companies that export their goods abroad. This is because people in those
nations are less likely to buy American-made goods when they are more
expensive in those nations. It can be clearly seen how Steve Madden is
perceived a premium brand in India because of the price points, but the
brand has a very different image in USA.

62
Exchange rate fluctuations have an impact on the value of international
investment portfolios, the competitiveness of imports and exports, the value of
international reserves, the value of foreign currency used to pay debts, and the
cost to travellers due to the value of their currency. Thus, changes in exchange
rates have significant effects on trade, capital flows, and the business cycle of
the economy, and are therefore essential for comprehending financial
developments and shifts in economic policy.

To reduce the risk associated with the volatility of future cash flows, the
company uses derivative instruments, specifically forward foreign exchange
contracts. The foreign exchange contracts are referred to as cash flow hedging
instruments and are used to lessen the effect of exchange rate fluctuations on a
few anticipated inventory purchases. Insofar as their domestic or international
operations involve doing business in foreign currencies, they are subject to
market risk. Additionally, since the majority of their inventory purchases are
made in foreign countries, future increases in the cost of goods sold may result
from fluctuations in the exchange rate between the US dollar and the local
currencies of their contract manufacturers.

They mainly control

these risks by making
these purchases in US
dollars. They may enter
into forward foreign
exchange contracts for
terms of no longer than
two years in order to
lessen the risk of
purchases made in
foreign currencies.
Here is the stats for
Mexico and Brazil's
currency dropping
against usd.

Additionally, because their subsidiaries and joint ventures in these nations use
the local currency as their functional currency and those financial results must
be converted into U.S. dollars, they are exposed to translation risk in connection
with their international operations in Canada, Mexico, Europe, South Africa,
China, Taiwan, and Israel. The comparability of financial results between years is
impacted by the foreign currency exchange rate translation adjustments
reflected in their financial statements with regard to their foreign operations
due to currency exchange rate fluctuations.

63
CONCLUSION

This was one of the most interesting projects that we have been
assigned. Not only did we explore the impact on the Indian audience but
also worldwide since this was an International Brand project. Pushed our
boundaries by not sticking to apparel but expanding it towards footwear.
I loved the challenges that came along the way. We were taught
theoretical concepts very practically which helped me with the
application of knowledge.

64