INTRODUCTION
Sports retail is a fast-growing segment of modern retail in India. It consists of goods required for participating in sports and fitness, as well as preventing related injuries. India is among the largest sports goods manufacturers in Asia after countries like China and Japan. Recently, the country has been hosting many international sports, which has boosted this sector. The increasing prevalence of lifestyle diseases and rising numbers of gyms and fitness centers have further pushed the demand for sports and fitness goods. Estimates show that the industry has grown at an average annual rate of around 10 – 12% in the past five years.
MARKET POTENTIAL
The Indian sports and fitness goods market reached a value of INR 130 billion in 2020. The market is poised to grow at a CAGR of 8.6% from 2021-2026. The major drivers of the industry, such as rising disposable incomes, increasing population, growing health awareness, the rising popularity of different sports, increasing prevalence of lifestyle disorders, and increased product demand from the younger population are expected to aid the market growth.
FUNDING SOURCE
Under a programme of the Development Alternatives Group, such enterprises have availed government support through the National Rural Livelihoods Mission, with an average loan size of INR 30,000.
BUSINESS ECONOMICS
FIXED CAPITAL (One Time Expenditure)
| MACHINERY & EQUIPMENT | AMOUNT (in INR) |
| Racks (5 @ INR 5,000/rack) | 25,000 |
| Chair | 800 |
| Counter (2 @ INR 4,000/counter) | 8,000 |
| TOTAL | 33,800 |
WORKING CAPITAL (recurring expenditure per month)
| RAW MATERIAL | AMOUNT (in INR) |
| Shoes (25 @ INR 750/piece) | 18,750 |
| Socks (80 @ INR 40/piece) | 3,200 |
| Cricket Bat (30 @ INR 600/piece) | 18,000 |
| Cricket Ball (150 @ INR 75/piece) | 11,250 |
| Football (30 @ INR 150/piece) | 4,500 |
| Basketball (15 @ INR 200/piece) | 3,000 |
| Hoodies (80 @ INR 350/piece) | 28,000 |
| Wickets (1 set includes 3 wickets) (15 @ INR 105/piece) | 1,575 |
| Badminton Racket (40 @ INR 300/piece) | 12,000 |
| Tennis Racket (8 @ INR 400/piece) | 3,200 |
| Shuttlecock (pack of 6) (150 @ INR 60/piece) | 9,000 |
| Tennis Ball (100 @ INR 60/piece) | 6,000 |
| Badminton Net (3 @ INR 1,500/piece) | 4,500 |
| Tennis Net (2 @ INR 1,500/piece) | 3,000 |
| Sports clothes (Males) (40 @ INR 900/piece) | 36,000 |
| Sports clothes (Females) (40 @ INR 900/piece) | 36,000 |
| STAFF AND LABOUR | AMOUNT (in INR) |
| Entrepreneur’s Salary (@INR 10,000/month) | 20,000 |
| UTILITIES & OTHER EXPENSES | AMOUNT (in INR) |
| Rent (@ INR 5,000/month) | 10,000 |
| Water (@ INR 1,000/month) | 1,000 |
| Electricity (@ INR 2,000/month) | 2,000 |
| Phone/Internet Bill (@ INR 600/month) | 600 |
| Transportation Cost (@ INR 2,000/month) | 2,000 |
| Stationery (@ INR 500/month) | 500 |
| TOTAL | 2,34,075 |
FINANCIAL SUMMARY (Annual)
| FINANCIALS | AMOUNT (in INR) |
| Fixed Cost | 33,800 |
| Working Capital (for each cycle of 2 months duration) | 2,34,075 |
| Total Enterprise Cost | 2,67,875 |
| Annual Revenue | 14,85,300 |
| Total Expenditure (annual working capital) | 14,04,450 |
| Enterprise Profit | 80,850 |
| Payback Period (in months) | 5 |
Note: All figures mentioned are indicative and for reference purpose only. Development Alternatives Group bears no liability for accuracy. For any further information, please contact Development Alternatives on +91-11-2654-4100 or +91-11-2654-4200.
Star Entrepreneur
Atul Kumar, a youth of just 20 years of age, wanted to do something that was uniques. Following his passion he ventured into opening a Sports Shop in his village in Bhadohi in 2020.
- Invested INR 35,000 of his own savings
- Monthly income at INR 8,000