The Challenge: Scaling Amidst Financial and Operational Struggles

Bharat Footwear Pvt. Ltd., an up-and-coming Indian footwear brand, was founded by two ambitious entrepreneurs, Ravi Malhotra and Sandeep Khurana, in Agra, the heart of India’s leather and footwear industry. Their mission was to create affordable yet stylish and durable shoes for the mass Indian market.

Despite strong initial sales, profitability remained elusive due to high manufacturing costs, inefficient operations, and a lack of strategic leadership. The founders were deeply involved in day-to-day operations, leaving little time to focus on long-term growth. They struggled with:

1. Unoptimized Supply Chain: High raw material costs and delays from vendors led to production bottlenecks.

2. Weak Branding & Distribution: The company lacked a strong market presence beyond a few states and was unable to scale online sales.

3. Cash Flow Issues: Despite good revenue, high operational expenses and a poor credit cycle made it hard to reinvest in growth.

4. Employee & Leadership Gaps: The organization lacked structured leadership, and decision-making was reactive rather than strategic.

To address these challenges, the founders decided to bring in an Interim CEO, an experienced business leader with a background in scaling mid-sized companies profitably.

The Solution: Bringing in an Interim CEO

In early 2023, Bharat Footwear hired Anirudh Mehta, a seasoned business leader with over 20 years of experience in retail and manufacturing, as an Interim CEO for a 12-month period. His mandate was to improve profitability, streamline operations, and scale the company nationally.

How the Interim CEO Transformed Bharat Footwear

1. Optimizing the Supply Chain & Cost Reduction

• Negotiated bulk purchasing deals with raw material suppliers, reducing material costs by 12%.

• Shifted to a just-in-time (JIT) inventory model, cutting storage costs by 20%.

• Identified alternate suppliers in South India, reducing dependency on expensive imports.

• Introduced lean manufacturing principles, improving efficiency and reducing waste.

2. Strengthening Branding & Expanding Market Presence

• Rebranded the company with modern packaging, better product photography, and a strong online presence.

• Partnered with leading e-commerce platforms like Amazon, Flipkart, and Myntra, increasing online sales by 60% in six months.

• Expanded offline retail presence by securing deals with major footwear retailers in Delhi, Mumbai, and Bengaluru.

3. Financial Discipline & Cash Flow Management

• Implemented strict financial tracking, ensuring better working capital management.

• Extended credit terms with suppliers while renegotiating terms with distributors to speed up cash inflows.

• Launched pre-booking models for bulk orders, improving cash reserves.

• Reduced overall operational expenses by 15% through targeted cost-cutting.

4. Enhancing Leadership & Employee Productivity

• Brought in a new Head of Sales & Marketing to drive revenue growth.

• Introduced structured performance incentives, improving employee productivity by 25%.

• Developed a succession plan, ensuring key leadership positions were filled with competent managers.

5. Product Expansion & Profitability Strategy

• Launched premium footwear lines for urban consumers, increasing profit margins.

• Introduced sustainable and eco-friendly shoe options, appealing to conscious consumers.

• Focused on export markets in the Middle East and Africa, diversifying revenue streams.

The Impact: Turning Bharat Footwear into a Profitable Organization

Over 12 months, the company saw a major turnaround, with key business metrics improving significantly:

• Revenue Growth: Increased from ₹50 Crores to ₹85 Crores (70% growth).

• Profit Margins: Improved from 8% to 18%, making the business financially sustainable.

• Online Sales: Grew by 60%, reducing dependency on offline retail.

• Cost Reduction: Achieved 15% lower operational costs, improving cash flow.

• Brand Presence: Expanded into five additional states, increasing market penetration.

Conclusion: A Strategic Pivot for Long-Term Growth

The Interim CEO played a critical role in transforming Bharat Footwear from a struggling startup to a scalable, profitable company. By focusing on cost efficiency, branding, leadership, and financial discipline, the organization successfully prepared for its next phase of growth.

At the end of Anirudh Mehta’s tenure, the company was in a strong position to hire a permanent CEO, ensuring continued success while maintaining the strategic foundation laid during his leadership.