Footwear prices to rise from August 1st: Here’s why

The August 1st implementation of new quality standards is anticipated to drive up the cost of footwear, with footwear prices expected to rise, as announced by the Bureau of Indian Standards (BIS). The announcement states that slippers, sandals, and shoes sold in the market will need to adhere to new quality standards. As of August 1, 2024, footwear producers must adhere to the new quality control order (QCO), which mandates that they follow IS 6721 and IS 10702 requirements. It is also anticipated that the desired quality level will lead to a rise in footwear prices, increasing the cost of goods for the makers.

The Bureau of Indian Standards (BIS) has announced the implementation of new quality standards for footwear effective August 1, 2024. This move is expected to drive up footwear prices as manufacturers grapple with the costs of meeting these updated regulations. The new standards will affect a wide range of footwear products including slippers, sandals, and shoes. According to the BIS, all producers must now adhere to the new Quality Control Order (QCO), which includes compliance with IS 6721 and IS 10702 requirements.

Impact on Footwear Prices and Market Dynamics

Under the new BIS guidelines, manufacturers are required to ensure that their products meet stringent quality criteria. This includes rigorous testing of raw materials such as rexine, insoles, and linings, which are commonly used in the production of footwear. Additionally, materials used for the exterior of the footwear must pass tests for tear resistance, strength, and flexibility. The BIS believes that these updated standards will enhance the durability and robustness of footwear, ultimately benefiting consumers by reducing issues related to product failure.

However, this shift in standards comes with a financial cost. The heightened quality requirements will inevitably lead to an increase in production expenses. As a result, it is anticipated that footwear prices will rise. Manufacturers will need to invest in better materials and more comprehensive testing processes to comply with the new standards. These additional costs are expected to be passed on to consumers, potentially making footwear more expensive across the board.

Interestingly, the BIS has specified that manufacturers with annual revenues less than ₹50 crore will be exempt from these new regulations. This exemption could create a disparity in the market, where smaller manufacturers may not be subject to the same quality controls as their larger counterparts. Additionally, merchants will be required to register and upload data regarding their existing stock, which means that even old inventory will not be exempt from the new regulations. The BIS has introduced this requirement to ensure that all products in the market adhere to the updated standards.

A total of 46 different footwear items will be subject to these updated BIS norms. The bureau has emphasized that the material posted on its website is intended for “awareness purposes,” aiming to inform both manufacturers and consumers about the upcoming changes.

Consumer Adjustments

With the implementation of these new standards, consumers should expect higher-quality footwear with improved safety and durability features. This enhancement in product quality is designed to provide better value for consumers, though it may also require them to adjust their budgets. The rise in footwear prices could lead to a reassessment of consumer spending on footwear, as the cost of high-quality shoes becomes more significant.

The updated BIS standards are likely to lead to a consolidation in the footwear market. Smaller manufacturers, who may struggle with the increased costs of compliance, could find it challenging to remain competitive. This may result in fewer players in the market and potentially less competition, which could affect pricing and product variety in the long run.

Future Considerations and BIS’s Role

The BIS has yet to provide detailed information on how it plans to address potential cost increases for manufacturers due to the higher standards. As the bureau is responsible for the standardization, evaluation of conformance, and quality control of products, it will be crucial for it to monitor the situation closely. The BIS’s product certification schemes offer third-party assurance of quality, safety, and dependability based on Indian Standards. However, without clear strategies to mitigate the impact of increased manufacturing costs, there may be concerns about how these new regulations will affect both the industry and consumers.

In conclusion, while the new BIS quality standards for footwear aim to enhance product durability and safety, they are also expected to result in higher footwear prices. Manufacturers will need to navigate these changes carefully, and consumers might need to adjust their spending habits to accommodate the anticipated rise in costs. As the industry adapts to these new regulations, it will be important to keep a close watch on how these adjustments unfold and their impact on the overall market.

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