Why Pramila Devi uses her slippers sparingly

For instance, Pramila Devi uses her sole pair of Hawaii chappal (flip flops) sparingly. She wears her pink worn-out pair to move around after sun down but seldom during the day, to prolong its life. The pair will not last more than six months if used daily.

Besides, moving around barefoot does not raise eyebrows in a village. It’s left to one’s choice and means. When most of what a family earns is spent on purchasing food, a pair of slippers, a bar of soap, or a set of clothes are indulgences.

Pramila Devi’s seven-member family is dependent on day wages earned by her son, a former migrant worker who used to work in a textile factory in the National Capital Region and send around 4,000 home every month. But after a minor accident scraped the flesh off one of his fingers while working on a machine, Pramila Devi coaxed him to return home in January. He now works as a farm hand, earning 250 a day. The wages have remained stagnant over the past few years and finding work—on or off the farm — even for 15 days a month, is tough.

Meanwhile, food expenses shot up. As wheat prices climbed over the past year, the family now spends 600 more every month compared to a year ago just to meet their flour requirement. Same goes for edible oils, pulses and other staples on which Pramila Devi spends around 7,000 now, compared to less than 5,000 in 2020, before the pandemic hit. That is for a diet which has very little fruits, fresh vegetables, dairy or meat products. And calorie-heavy meals whose sole purpose is to fill stomachs, such as a watery potato curry to go with wheat flatbreads.

Asif Ali, a trader. At the wholesale footwear market in Muzaffarpur, more than 11 traders shut shop in the past two years

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Asif Ali, a trader. At the wholesale footwear market in Muzaffarpur, more than 11 traders shut shop in the past two years (Photo: Sayantan Bera/Mint)

Of late, managing household expenses has become a daunting task, the women of Methi complain. They worked for just 12 days (since the beginning of the financial year in April 2022) under the rural jobs scheme which promises to provide 100 days of work to rural families in a year. The work was allocated after repeated protest demonstrations before local government offices. In December, the federal government withdrew the pandemic assistance of 5kg of free food grains (in addition to another 5kg per person per month provided under the food security scheme).

The families often borrow from local money lenders at exorbitant interest rates of 5% per month to meet their grocery and sudden medical expenses.

“I spend a lot of time collecting firewood because I cannot afford cooking gas. In the past one year, we were able to buy just a few sets of clothes. I use my slippers carefully because if it gives way, I will not have a pair to wear when I step out of the village,» Pramila Devi said.

For Rinku Devi, who lives a short distance away from Methi, not able to buy a pair of slippers is the least of her concerns. In February, she travelled barefoot as part of a rights group to Delhi’s protest corner, Jantar Mantar, to air her grievances on the rural jobs scheme. She wants more days of work under the scheme and wants the government to withdraw an order which mandates that attendance be registered on a mobile app, twice daily. After working through the day, at times, their attendance is not recorded due to poor mobile connectivity.

“After a piece of metal pierced my foot, I visited a market in Delhi but 150 was too much to spare for a pair of slippers,» Devi said, laughing. “I would rather spend that money on food for my children.»

Pramila Devi and Rinku Devi belong to the bottom of India’s consumption pyramid. But they are also part of an 800-million-strong consumer base who are acutely dependent on subsidized food rations—accounting for 60% of India’s population. A little more income in their hands can drive consumption of numerous items, from fast moving consumer products to clothes and footwear. But falling sales of low-priced footwear in India, the second largest producer globally, is an indicator of severe income stress in these low-income families.

Slide in sales

Indians purchased an estimated 2.6 billion pairs of footwear in 2019-20 but sales tanked 35% in 2020-21 after the pandemic hit, observes a note published (January 2022) by ICICIDirect, a brokerage. Between 2022-2025, consumption was estimated to grow at a compounded annual growth rate of 8-10%. Sales picked up in 2021-22 after lockdown restrictions were lifted and the threat of infections waned.

But in the ongoing financial year (2022-23), sales of low-priced open footwear products have stuttered. Relaxo Footwears, a leading mass market brand, reported an 8% drop in sales volumes and revenues in the third quarter (October-December) of 2022-23, which includes major festivals like Diwali and Dussehra when shoppers throng markets in large numbers.

“The management indicated that demand continued to remain subdued and was negatively impacted by high inflation, which impacted the purchasing power of its core customer. The mass category of open footwear had declined due to customers shifting to cheaper unbranded products,» ICICIDirect said in a note last month.

According to Gaurav Dua, executive director at Relaxo, lower sales in 2022 were primarily due to a sharp increase in raw material prices and a hike in the goods and services tax (GST) from 5% to 12%—which pushed Relaxo to increase retail prices. But it was later forced to lower prices twice, in May and September, to arrest the slide in sales, taking a hit on its bottom line.

“Demand for open footwear shot up after the lockdown was announced. In 2022, we lost market share to unorganized smaller players following the price hikes. As of now, there is no problem in urban areas but demand recovery in rural areas is slower than usual,» Dua told Mint.

“But we expect the market to stabilize and share of organized players to grow in future,» he added.

A look at Relaxo’s third-quarter numbers (FY2023) show that even if it maintains similar sales volumes (as reported in FY2022) in the fourth quarter, the company will sell 160 million pairs in 2022-23, about 11% fewer pairs than what it sold in the pre-pandemic year 2019-20.

Similarly, Bata India reported a 5% drop in sales volumes in the third-quarter of 2022-23, even though its average sale price (ASP) per pair grew 13% due to a focus on selling more premium products (resulting in 7% growth in revenues), according to a note from HDFC Securities.

Mohammad Irshad, a small footwear retailer. He purchased merchandise worth  <span class=₹70,000 during the festive season last year, but could sell less than a fourth of it. » title=»Mohammad Irshad, a small footwear retailer. He purchased merchandise worth ₹70,000 during the festive season last year, but could sell less than a fourth of it. «>

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Mohammad Irshad, a small footwear retailer. He purchased merchandise worth 70,000 during the festive season last year, but could sell less than a fourth of it. (Photo: Sayantan Bera/Mint)
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