This is the story of a Canadian brand that became a global success – after going bankrupt in its home country.
And a tale of how fortunes can turn in business, and how smart entrepreneurs can shift problems into opportunities when they have the chance to learn and grow.
The green-and-white Woodland logo is a familiar one in urban India, coveted by youth who love outdoor lifestyles marked by comfortable, rugged shoes and casual clothes.
Sporting a pair of his company's shoes, managing director Harkirat Singh – a 44-year-old golf-and-tennis-loving Sikh – recalls how the brand was born under difficult circumstances. In the late 1980s, Mr. Singh's family run Aero Group was an exporter of shoe uppers and leather products to Canada and the former Soviet Union. Aero Group landed a big shipment for customer Marcel Garneau, whose Quebec-based importing company was facing bankruptcy. “Their bankers came to us and said: ‘why don't you take it over?’” Mr. Singh explains.
Aero Group acquired the factory Mr. Singh describes as a victim of an internal dispute. The supplier-turned-owner was granted access to three brands: White Fox for fur-lined shoes, Boutique for fashionable footwear, and the outdoorsy Woodland. Customers included Sears and Bata, Mr. Singh says. For the Indian parent company, it was a steep learning curve to make waterproof, heat-retaining shoes that were more closely tied to Canadian culture.
Aero Group was then in a pre-reform India and a closed economy, a time when competitive exporters preferred to earn precious dollars elsewhere rather than sell their wares at home. As Aero Group learned the arts of retailing, marketing and design suited to Canada’s cold climate, it further evolved.
By the mid 1990s, the company was eyeing Russia – familiar territory where Mr. Singh had studied philology to pick up Russian. Europe was a logical extension. Europeans and Russians fancied the high-end products made in Canada, and it was up to a tropical entrepreneur to take the boots to discerning cold-weather Europeans who appreciated the value, despite an influx of cheaper Chinese-made shoes.
Meanwhile, India started to become a market-oriented economy as a wave of reforms began in 1991, and Mr. Singh spotted an emerging opportunity in his own backyard.
“We made a special line of shoes for India,” says Mr. Singh of Woodland's entry in 1992. The basic brand attributes of the “tough, wearable” Woodland brand were carried over to summer products. But winning customers was not the only challenge. Retailers in India were different from those in Europe, where payments were easy and secure.
“In India, credit lines were tough,” he says. “We had to really adjust to the Indian market.”
While the market was rising in India, it was waning in Canada, where cheaper Chinese options were flourishing, so Woodland moved away from its birthplace. Factory equipment was shifted to India, but the brand acquired new life when Italian and German designers stepped in to add value.
“When we came to India, we had the best of both worlds,” Mr. Singh says, referring to Canadian utility and European design. Woodland shoes were now rugged and trendy.
Woodland – now the flagship of the Aero Group – launched its own store in 1996, and it has since grown to a 350-strong chain of company-owned stores, while supplying to 3,000 multi-brand stores.
“We have plans for 50 to 60 stores every year,” Mr. Singh says, evidently thinking big in the midst of a middle-class consumer surge in a nation of 1.2 billion people.
Business has evolved on all fronts. Aero Group, which started out with tanneries in two Indian towns, now has a robotics-aided plant for precision-engineered shoes. Sales, which were in the vicinity of 800 million Indian rupees (about $15 million) in the 1980s has now grown twelve-fold, about 70 per cent of which comes from India. The group now employs 10,000 people. The Woodland brand has diversified into fashionable apparel such as jackets and T-shirts with a focus on ecologically friendly products.
About 60 per cent of apparel and 70 per cent of shoes are still made in-house, with the rest outsourced.
Besides its Indian units, the group now has partner plants in Bangladesh, Vietnam and China to make shoes and it is betting on e-commerce and social media to reach across to younger customers. In all markets, Mr. Singh says, the approach is to do some pilot studies and then move carefully forward. “Today, we see the whole world as our market,” Mr. Singh explains, as he mulls over a possible re-entry into Canada – where it all began.
“Business is always flexible,” he says. “You have to go where you see the opportunity.”
Special to the Globe and Mail
Narayanan Madhavan is associate editor of the business news pages of Hindustan Times, a leading Indian daily newspaper. He has previously worked for Reuters, the international news agency, as well as The Economic Times and Business Standard, India's leading business dailies. Though focused mainly on business and economic journalism with a strong focus on information technology and the Internet, he has also covered or written about issues including politics, diplomacy, cinema, culture, cricket and social issues. He has an honours degree in economics and a master's degree in political science from the University of Delhi.
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