Weekly Startup Profiles > Big Shoe Bazaar.com Pvt. Ltd.

Big Shoe Bazaar.com
No more traffic hassles and always the right shoes on hand, promises Big Shoe Bazaar, India's first online shoe retailer.

Quick Facts
Entrepreneur : Danish Ahmed Abdullah
Age : 25
Company : Big Shoe Bazaar.com Pvt. Ltd.
Based in : Delhi
Founded in : 2006
Industry : Retail

Business Summary


Online retail shoe store.

The Idea

Manit from Muzzfarbad had been looking for a good pair of shoes. Smaller shops in his town just didn't stock the kind that he wanted. So he went online and found www.bigshoebazaar.com. From the site, he selected a pair from a range of 34 brands and 3,000 different designs. However, he was not sure of his size. No problem, said the online shoe store, order two sizes. Four days later, Manit received both pairs of shoes. He tried them on, paid for the one that fit and returned the other. One more customer using the retail service put together by Danish Ahmed.

Danish discovered the opportunity for Big Shoe Bazaar completely by accident. Danish's family runs a footwear business, and his father asked Danish to sell some surplus stock. Danish sold the stock on rediff.com and was surprised how fast the shoes disappeared. "That is where the idea came from: if unbranded shoes can sell so well, what can we do with branded ones?" Danish asked himself.

To test his idea, Danish convinced footwear manufacturers to allow him to photograph their products to display on a website that he created. The results were unexpected: "I was really surprised with the first year's turnover which was double of what I expected: Rs 16 lakhs," says Danish. With that, Danish decided to pursue the business.

The Opportunity

In America, online shoe retailing is already a $3 billion business, where 100,000 shoes are sold everyday. While in India the online shoe retail business is nascent, according to Danish, the overall the footwear business is large and growing. "The Indian footwear retail industry is worth about Rs 15,000 crores and its growing at 25-35% annually," he says.

Danish is catering to the nexus of internet users and people who are selective regarding their purchases. "The growth is highly skewed towards branded products. There is a growing preference of customers towards high-price, high-quality products," says Danish.

Many of these customers are in Tier 2 and Tier 3 towns, where branded shoes are harder or impossible to find. However, even customers in major metros, where shoe stores abound, are starting to turn to the online world of Big Shoe Bazaar, says Danish. Perhaps the increasing traffic in many cities is helping: "Customers choose us to get their choice of shoes home delivered, saving them the entire hassle of going to a mall and browsing through the stores," he explains.

Danish has not used special means to build his customer traffic - he has relied essentially on search engine optimization and other online marketing techniques. He has, however, combined that with special offers like discount coupons and rewards for providing referrals.

Over 90% of shoes in India are sold through small independent stores. Danish feels that his real competition, however, comes from the multi-brand outlets opening in many cities. Danish believes that Big Shoe Bazaar holds an advantage: "These retailers are very limited to the amount of variety they can offer to the customer."

Another advantage that Big Shoe Bazaar may have developed, according to Danish, is their relationships with their suppliers. "We had to put in a lot of time convincing the senior management at these companies that we required extraordinary service standards," he says. This service in turn allows Big Shoe Bazaar to provide responsive high-quality service to its customers.

The Money

The initial investment of Rs 5 lakhs for Big Shoe Bazaar came from Danish's father. "All our funds have come from daily direct marketing focused on one person who is now the chairman of this company my Dad. In the last 18 months, I think he must have told me at least a 100 times to close the company. At least 30 times I have been threatened that this is the last cheque I am giving you," chuckles Danish.

The business requires recurring investment. "Our growth rate is faster than our profit margin. Hence I require more working capital all the time," says Danish. So far, he's invested Rs 30 lakhs into the business.

The Team

For the first three months, Danish was the photographer, the editor, the webmaster, the customer care executive, and the procurement and dispatch team. However, Danish believes that his business cannot grow without a good team. "We never compromised on people. We had a turnover of Rs 3 lakhs per month when we hired a guy for 30,000 per month. He is still with us," says Danish. Today Big Shoe Bazaar has 21 employees.

The Company - today and tomorrow

Big Shoe Bazaar's online business continues to grow, but Danish is looking beyond the internet for the company's future. "Customers are moving towards organized retail; they want bigger brands, better quality, a lot of variety and good prices," he explains.

Danish feels that a combination of on-and off-line retail would work well for these increasingly demanding customers.

Today, Big Shoe Bazaar has opened two stores, one in Raigad and another in Kanpur. At these stores, if customers fail to find what they want, they can browse the website at computers located in the store, to purchase their shoes online. Danish plans to grow by having both owned and franchised stores. "We will have 6 company owned stores by the end of 2008 and 30 franchisees stores - a brick-and-click model," announces Danish.

Franchisees will likely be those who are already running shoe stores, but are looking for help in the face of competition from increasingly organized retail. They will receive help with employee training, marketing and promotional material. Danish will supply shoes, earning a wholesale margin; the retailers retain the retail margin.

The key additional incentive being offered by Big Shoe Bazaar is that franchisees will also receive a share of the revenue from anything purchased from www.bigshoebazaar.com within 16 sq kms of their shop.

Danish believes they are positioned well for this growth: "There are more than 10,000 local multi-brand outlets in India and these are all our potential franchisees."

What keeps you awake at night?

Competition and growth, says Danish. "I am always concerned and keep on thinking about the path the business will take."

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