New York, Nov.25 (ANI): Sportswear giant Reebok has confirmed plans to launch shoes costing a dollar a pair in Indian villages.
The Wall Street Journal (WSJ) quoted Daniel Sarro, a spokesman for Reebok International Ltd., as saying that the project is based on a "social business model" that has a goal of "tackling social issues through entrepreneurial actions and not by maximizing profit."
Sarro did not specify a date for the launch, but further information from the company is expected later this year.
The one dollar shoe might be viewed in the apparel industry as the equivalent of Tata's Nano, the world's cheapest car, which was introduced to allow families to graduate to four wheels from two.
Reebok's shoes could allow the poor who buy them to graduate either from no shoes or flipflops to sneakers.
While the move may be the first of its kind in India, a similar initiative was undertaken in Bangladesh last year, where the company offered 5,000 pairs of Reebok shoes to locals in three villages.
Sarro explained that the objective was to assess consumer needs and identify sales and distribution patterns across emerging markets.
Though the response was positive, he added that "a number of challenges became evident during this phase."
Absence of a permanent office, lack of trained staff and heavy import costs and taxes were a few, Sarro noted.
Sarro said the project is technically feasible across the country.
"In India, Reebok has a central headquarters and a range of staff that can dedicate the time needed to develop the product," he said.
Though the company is yet to finalize the details, Sarro added that the low-cost shoes are being introduced with a view to "develop a sustainable business model to ensure the program's long-term success."
Navneet Narwan, a program leader at Institute of Rural Research and Development, said the strategy "appeared to be a win-win situation for the poor" though it would be important to analyze its reach and impact. (ANI)
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