Relaxo Footwears: Inventory Decisions in a High-SKU Market

Mohd Imran Khan, Tarunpreet Kaur Ahuja, Rakesh Kumar Meet, Amol Subhash Dhaigude, Vijay Wadhwani, Abhishek Kumar Jha, Sunil Rai

Product #:W50576

Supplier:Ivey

Discipline:Operations Management, Strategy

Setting:India, 2024

Details:Case (PDF) • 12 pages • 2026-08-05

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In August 2024, the assistant vice-president (AVP) of supply chain at Relaxo Footwear Ltd. (Relaxo), faced an operational dilemma. Despite rising inventory levels, service performance for the company’s fast-moving stock-keeping units (SKUs) had fallen below target levels ahead of the busy festive season. Sales teams advocated expanding the breadth of the company’s assortment to protect shelf space, while operations teams warned of execution strain, warehouse-space pressure, and the rising cost of carrying and liquidating slow-moving stock. In a week, the AVP would have to recommend a plan to the executive director that would position Relaxo favourably amid these pressures. Before the festive season began, should the company continue to expand the breadth of its assortment, narrow its assortment, or adopt different inventory policies for different SKUs?

Learning Objectives

This case is suitable for use in undergraduate, master of business administration (MBA), post-graduate diploma in management, and executive education programs, particularly in courses on operations management, supply chain management, and strategic management. It is most effective in MBA core or elective courses in operations and supply chain management, as well as in executive education programs focused on operational decision-making under growth, capacity, and working capital constraints. The case works well as a late-module or capstone case, where students are expected to integrate operational, financial, and strategic perspectives to make a defensible managerial recommendation. In addition to its core operations focus, the case is appropriate for strategy-integration sessions and executive discussions on balancing growth, control, and capital discipline in consumer-facing industries. The case encourages students to utilize the data presented in the case narrative and exhibits to do the following:

Diagnose how scale and assortment complexity strain supply chain performance and expose the limits of uniform inventory policies.
Apply ABC–XYZ logic to segment inventory based on economic importance and demand variability.
Evaluate differentiated inventory and service strategies that balance service levels, risk, and resource constraints.
Formulate and defend a managerial recommendation under time pressure and cross-functional conflict.
Critically use generative artificial intelligence (AI) tools to perform a structured case analysis while validating assumptions: formulate structured prompts, verify computational outputs, identify boundary cases and threshold sensitivity, and translate analytical output into managerial recommendations.