SPORTS GOODS

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CONTENTS

S.NO. CONTENTS PAGE NO.

1 Introduction to SMEs 3

2 Introduction to sports goods industry 4-6

3 Key markets and export destinations 7-8

4 Key Players 9-10

5 Major export items in sports goods 11

6 Major export destinations 12

7 Industrial statistics for sports goods 13-14

8 Methodology to be adopted for analysis and selection of markets for sports goods industry

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9 Conclusion 16

10 Bibliography 17

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INTRODUCTION TO SMEs

SMEs have been playing a pivotal role in country’s overall economic growth, and have achieved

steady progress over the last couple of years. From the perspective of industrial development in

India, and hence the growth of the overall economy, SMEs have to play a prominent role, given

that their labour intensiveness generates employment. The SME segment also plays a major role

in developing countries such as India in an effort to alleviate poverty and propel sustainable

growth. They also lead to an equitable distribution of income due to the nature of business.

Moreover, SMEs in countries such as India help in efficient allocation of resources by

implementing labour intensive production processes, given the abundant supply of labour in

these countries, wherein capital is scarce.

The enactment of the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006

was a landmark initiative taken by the Government of India to enable the SMEs’ competitive

strength, address the issues and challenges and reap the benefits of the global market. SME

policy initiatives at the national and state level are aimed at strengthening the role of SMEs at

the base as well as at the higher level. The Tamil Nadu Government formulating an exclusive

policy for micro, small and medium enterprises sector to encourage agro-based industries is a

recent example of the changes taking place at the ground level. The policy offers a range of

incentives and support for infrastructure development, subsidies for investment in industrially

backward areas, capital investment and technology development aiming to sustain over 10%

growth of the MSME segment in the food and agro sector.

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INTRODUCTIONS TO SPORTS GOODS INDUSTRY

The sports goods industry of India has its roots in Sialkot, Pakistan. When India was partitioned

in 1947, many of Sialkot's skilled Hindu craftsmen migrated across the border into Punjab,

settling in Jalandhar, where the Indian sports goods industry is now based. The Indian sports

goods industry has expanded to include the areas of Meerut, (Uttar Pradesh) and Gurgaon,

(Haryana). Most of India's sports goods are exported to the United Kingdom, The United States

of America, Germany, France and Australia. The industry is mainly concentrated in Jalandhar

and Meerut.

The sports goods industry in India has witnessed a phenomenal growth over the past five decades

and now occupies a place of prominence in the Indian economy in view of its massive potential

for employment, growth and export. There has been an increasing emphasis on its planned

development, aimed at optimal utilization of resources for maximizing the returns, particularly

from exports.

The Indian sports goods industry manufactures 318 items. However, major items that are

exported are inflatable balls, hockey sticks and balls, cricket bats and balls, boxing equipment,

fishing equipment, indoor games like carom and chess boards and different kinds of protective

equipment. The Indian sports goods industry is a highly labour intensive industry which provides

employment to the weaker sections of society and also employs a large number of women.

The global market share of India in this segment is barely 1% but 60% of the sports goods manufactured in India are exported. The reason for such less market share is that Indian sporting goods industry is concentrated mainly in the cottage and small-scale sector.

Indian sports goods industry has high potential in terms of quality, quantity and focus. The only thing that is missing is international orientation. The fact is that Indian manufacturers have never compromised on quality and that is the reason that most of the produce is exported. Point to be noticed is the maximum exported product is to the OEM suppliers.

Sports manufacturing companies have numerous ranges of products which they can produce. Some of these include tennis rackets, rugby balls, soccer balls, cricket equipment, bowling balls and many others.

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Sporting Goods industry in India, which is now one hundred and sixteen years old is spread over

the length and breadth of the country. There are major manufacturing concentrations in and

around Jalandhar, Delhi, Agra, Moradabad, Mumbai, Kolkata and Chennai. The Indian

sports goods industry has expanded to include the areas of Meerut, (Uttar Pradesh) and

Gurgaon (Haryana).

India's Sports Goods Industry, which is centered largely in Meerut and Jalandhar, exports

sporting goods and equipment worth more than Rs 200 crores. Major export items include

football and cricket gear, and athletic equipment. Both these cities together claim around 75% to

80 % of the total domestic production with more than 3000 manufacturing units, including

around 130 exporters. The sports goods industry of Jalandhar is widely known for the production

of quality sports goods in Asia.

Most of India's sports goods are exported to the United Kingdom, The United States of America,

Germany, France and Australia. There are around 400 registered sports goods exporters with the

Sports Goods Export Promotion Council (SGEPC) alone.

The Indian Sports Goods Industry

The sports goods industry in India is nearly a century old and has flourished due to the

skills of its workforce

A robust growth rate of 14.7 per cent in exports indicates a sizeable opportunity for India

in this sector

Being labour-intensive in nature, the Indian sports goods industry provides employment

to more than 5,00,000 people

The sports and leisure goods retail market in India was valued at US$ 17.7 billion for

2007-2008. The market grew at the rate of 18 per cent over 2006-2007 in value terms,

primarily due to outlet expansions by industry players

The nucleus of the industry in India is in and around the states of Punjab and Uttar

Pradesh; Jalandhar (Punjab) and Meerut (Uttar Pradesh) together account for nearly

81.8 per cent of total domestic production with more than 3,000 manufacturing units and

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130 exporters present in these two towns

About 60 per cent of the sports goods manufactured in Jalandhar are different kinds of

inflatable balls and provide direct employment to more than thousands of workers.

The industry also has a presence in Mumbai, Kolkata and Chennai, albeit at a lower scale

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KEY MARKETS & EXPORT DESTINATIONS

Industry exports were valued at approximately US$ 129 million1 in 2007-2008, growing

from US$ 74.5 million in 2003-2004 at a rate of 14.7 per cent.

India’s share of the global sports goods exports market is expected to grow manifold,

with the country establishing the credibility of its goods in the global market

In recent years, India has emerged as the leading international sourcing destination for

inflatable balls and other sports goods for international brands such as Mitre, Lotto,

Umbro and Wilson

Today, Indian sports goods manufacturers are exporting products under their own brand

names, in addition to being original equipment manufacturers (OEM) suppliers for

international sports brands.

 

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For the period 2003-2004 to 2007-2008, general exercise equipment emerged the

category leader in the export products segment, witnessing the highest growth rate of

27.3 per cent. Hammocks have emerged as one of the leading export products, growing at

a rate of 24.1, with India home to the leading hammock manufacturers in Asia. Inflatable

balls’ exports grew at a rate of 10.6 per cent

The EU, America and Australia are some of the key global export markets for Indian

sports goods. The UK is India’s largest export market - India exported US$ 38.4

million worth of sports and toy products to the UK between 2006 and 2008, exhibiting a

growth of 15.3 per cent

In recent years, Indian products have been exported for global sports events such as the

football World Cup 2002, where India-manufactured bladders were used. Athletic

equipment made in India was also used at the Atlanta Olympics (1996) and Beijing

Olympics (2008).

 

KEY PLAYERS

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International and domestic sports brands have become immensely popular among the youth in

India as a result of an increasing awareness about fitness and healthier lifestyles. Some of the key

global players are:

Reebok India Pvt. Ltd. (520 outlets)1

Adidas India Marketing Pvt. Ltd. (220 outlets)

Nike India (150 outlets)

Royal Sporting House (60 outlets)

Planet Retail Holdings Pvt. Ltd. (36 outlets)

 

Some of the key domestic players are:

Cosco India Ltd.

Enkay (India) Rubber Co. Pvt. Ltd.

Sanspareils Greenlands Pvt. Ltd.

BDM

Stag International

Nivia Sports

 

Advantage To India

The sports goods sector is a major contributor to the Indian economy in terms of employment

and enjoys a clear competitive edge.

Custom-made products

Indian products have the distinct advantage of being tailor-made to individual product

specifications, with hand-crafted goods such as cricket balls carving a niche in the global

market.

Strong workforce

Indian industry has a highly-skilled workforce for designing and producing high volumes

of sport goods.

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Competitive labour costs

India’s average labour cost for manufacturing is much lower than the rest of the world.

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MAJOR EXPORT ITEMS IN SPORTS GOODS

India is one of the largest exporters of inflatable balls, cricket bats, hockey sticks and balls,

boxing equipment, fishing equipment, Equipment for sports like indoor games like carom and

chess boards and different types of protective equipment. The total Indian domestic market for

various sports goods items is estimated to be around Rs170 Cr. of which cricket-related

equipment alone accounts for 70% of the total market.

The largest component of export is inflatable balls, which accounts for 50.6 % of total exports of

sports goods, followed by cricket bats (8.4 %) and gymnasium equipment (7.3 %).

India also imports sports goods, particularly gym and athletic equipment. In 1997-98, India's

imports were about Rs 30 Cr. The Indian sports goods industry manufactures 318 items.

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MAJOR EXPORT DESTINATIONS

The countries where Indian sports goods are imported are:

United Kingdom Australia The United States of America Italy Germany South Africa France New Zealand Netherlands Several Asian countries

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INDUSTRIAL STATISTICS FOR SPORTS GOODS

Export Growth

Indian exports have almost doubled from Rs.109 crores in 1993-94 to Rs. 204 crores in 1997-98

with the compounded growth rate of about 11 % per annum.

Trade Figures (1997-98)

Indian domestic market: Rs170 crores

Imports: Rs 30 crores approx.

Exports: Rs 204 crores approx.

Component Share In Total Exports

Cricket-related equipment alone accounts for a major percentage of the total market.

Inflatable balls: 50.6 % approx

Cricket bats: 8.4 % approx

Gymnasium equipment: 7.3 %approx

Others: 32% approx

Region-Wise Share In Sports Goods Production

Geographically, Jalandhar and Meerut, together claim 75 to 80 % of the total domestic

production. They have with more than 3000 manufacturing units, including around 120

exporters.

Country-Wise Market Share

The approximate share of various major countries in the world sporting goods market is as

follows:

1. United States of America (USA): 30%

2. European Union (EU): 33%

3. Japan: 22%

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4. Canada: 3%

5. India: less than 1 %.

6. Rest of the world: 12%.

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METHODOLOGY TO BE ADOPTED FOR ANALYSIS & SELECTION OF

MARKETS FOR SPORTS GOODS INDUSTRY

Identify few thrust products within sports goods and fitness equipment for production and

export.

Identify major markets for these goods

Launch a series of sports goods missions to identified markets to identify partners, technology

transfers and buy back arrangements

Adopt a consortium approach for export promotion by involving international trading houses

Continuously disseminate information on the potential of these sectors to attract more players

in this field.

We can also follow this process in order to identify the markets for the sports goods:

Identify Potential Customers

Conducting Market Research

Choosing a Target Market

Compiling a Customer Profile

Resources

As we have analyzed that sports goods industry is flourishing at a very rapid pace and there are

many countries where the sports goods manufactured are being exported more than they are

imported in the country. Hence above are the steps that can be included for selecting and

analyzing the market for sports goods.

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CONCLUSION

Indian Sports Goods industry has proud antecedents, which date back to more than 100 years. It

is born out of India’s age-old nurtured and mastered skills in the areas of metal processing,

leather crafts, wood crafts and a host of other industries. The industry is spread all over the

country, with major manufacturing centers in and around Jalandhar, Meerut, Delhi, Mumbai,

Kolkota and Chennai.

Indian Sports Goods are well known around the world and have made a mark in the global sports

goods market. They have established their identity in many countries across the world as a

reliable supplier of quality sports goods. The exports have grown from Rs.3350 million in 2003-

04 to Rs.5064 million in 2007-08, showing a steady growth of over 10 per cent per annum. The

major markets are: UK, Australia, USA, France, Germany, South Africa, New Zealand, Italy,

Canada, etc.

India, which exports nearly 60% of its total domestic output to the sports loving people all over

the world, has matured into a globally competitive & creative entity. The contribution by the

Indian sports goods industry to the international sports goods market has been remarkable. The

major sports goods exported from India are: Inflatable balls, Cricket Bats, Protective Equipment

for Cricket, Hammocks, Boxing Equipment, General Exercise Equipment, Cricket and Hockey

Balls, Nets, Protective Equipment for Football, Bladders, Carrom Board and Chess, T.T.

Equipment, Fishing Equipment, Golf Balls, Hockey Sticks, etc.. Indian manufacturers are

exporting these products in their own brand names as well as O.E.M. suppliers to International

brands like Adidas, Dunlop, Fila, Gap, Nike, Rawlings, Reebok, Spalding, to name a few.

The fitness equipment industry in the country is having boom time with its market size reaching

Rs.10000 million. With the rise in disposable income and consumerism, people are becoming

increasingly health/fitness conscious and the demand for the affordable fitness products are

growing at a rapid rate. Consequently, the industry is showing significant growth potential.

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BIBLIOGRAPHY

Source: Internet

http://www.va-interactive.com/inbusiness/editorial/sales/ibt/target_market.html

http://www.sgfi.org/

http://www.sporting-goods-industry.com/manufacturing-region-india/jalandhar-spoting-goods-

manufacturing.html

http://www.sporting-goods-industry.com/industry-statistics/

http://www.sporting-goods-industry.com/sports-goods-industry/trade-trends.html

http://www.dnb.co.in/SME%20Awards/methodology.asp

http://www.sgmea.org/index.html

http://www.dsir.gov.in/reports/mitcon/chap2.pdf

http://www.indiatradefair.com/pro/details-of-fair.html

http://www.intermesh.net/sports-goods.html

http://www.sportsgoodsexhibitionindia.com/info_indiansports_industry.html

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