Strategic forward march :BATA

Prof S P Garg
Jaipuria Institute of Management
Jaipur (INDIA)
 Strategic forward march :BATA
• Bata India , a part of Switzerland based Bata
Group
• Mr Marcelo Villigran: MD
• Seventy five+ age old foot wear brand
• ‘Back –to–School’ shoe days to appeal
young generation by presenting a much
more youthful and vibrant face
• Theme : to “surprise customers” with an
expanded range for all at “great prices”– in
an improved or new environment
Strategic forward march :BATA
• Bata India MD Marcelo Villagran says, "In
today's challenging market, our strategy of
opening large format stores has been
successful and we would continue to
invest in expanding our retail business.
Along with this, we have also focused
upon providing our customers with a new
trendy collection and better shoe designs.
Our value pricing, coupled with improved
customer service, has helped us to grow."
Strategic forward march :BATA
• Strategies adopted

• Positioning in fashion footwear segment with

a huge range of trendy footwear
• Realizing that customer service and
satisfaction is the mantra
• To reinforce its image as the “the most
trusted footwear brand”
Strategic forward march :BATA
• Expanding its retail footprints in major
metro and other big cities
• Revamping key stores :More store space
• Superior retail out fits &Closing unviable
stores
• At present 1300 stores in 400 cities in
India, all company owned
• Reaching out rural markets through dealer
network
 Strategic forward march :BATA
• reinventing itself to get back into the fast track.
The company has a three-pronged strategy:
setting up 60 large-format stores every year
(minimum area of 3,000 sq ft), closing down the
unviable ones and increasing its focus on
institutional business.
• Defying the trend in the retail industry of putting
expansion plans on hold, Bata opened 32 new
retail stores in the first quarter of 2009. These
new stores have a minimum area of 3,000 sq ft
each.
Strategic forward march :BATA
• Focus on product design –contemporary
look
• Range of offering in every market segment
and every occasion
• Introducing new offerings: men, ladies,
sports, children
• Targeting for family as a whole
• Launch of new specialized division :Bata
Industrials for sectors like defense,
automobiles, petroleum, construction,
agriculture, metal
 Strategic forward march :BATA
• Initiation of regular customer feed back
process, customer research ,training of staff
• Multi pronged sourcing strategy to reach
faster procure faster, more economically,
• Consolidation of manufacturing operationsy
• Restructuring of wholesale division into four
independent distribution channels : urban,
and institutional, safety, branding segment
for more impact and better sales
• Strong focus on financial controls
 Strategic forward march :BATA
• Investment in technology & systems
• Bringing all major commercial and
financial process under common
technology platform
• Installation of a “point of sale” software in
almost all retail outlets
 Strategic forward march :BATA
• The stores operate in a four-tier retail format under a new model --
upmarket flagship stores, smart and trendy city stores and super
stores and traditional family stores. This helps the company service
its customers better in places where currently it does not have
presence.
• "The large-format stores are mostly franchise-run. The new-design
store interiors itself cost the company around Rs 2 crore per store,"
Bata chairman P M Sinha says.  These new stores have helped
Bata to bring its contemporary and trendy range of footwear sold in
an international style outlet to customers even in small towns.
• Rapid expansion and modernisation is one part of the story. The
other is shedding flab. Bata has reduced the number of its unviable
stores from 140 to 74 and is open to shutting down more such
stores in future. The company has close to 1200 stores and 2,000
SKUs in India.
 Strategic forward march :BATA

• The company is also depending on institutional

business heavily. "We will have shoes tailor-
made for hospitals, military forces, factory
workers, and airlines. We will also introduce a
new range of sports shoes in India this year
which will be comparable to the best sportswear
brands available here," Sinha says.
 Strategic forward march :BATA
• The company has already set up a dedicated team headed
by a retired defence man to secure contracts. The total
market size for footwear used by the defence personnel is
about 12 million pairs a year.
• "The country has roughly three million defence and
paramilitary personnel and each buys four pair of shoes per
year, totalling 12 million pairs a year. That's a big market,"
Sinha says
• . Defence authorities currently source most of its footwear
requirement from unorganised players. After eyeing the
defence segment, Bata is also moving aggressively into the
safety footwear market as a new thrust area for growth.
• Parent group Bata Worldwide would be providing
technology sourced from the Safety and Industrial Centre at
Holland.
 Strategic forward march :BATA
Results
• Turnover of Rs 1008 crores during 2008
• 4.5crores sale of foot pairs
• 13.34% rise in profits
• Reduced borrowings and generation of
higher liquidity to fund growth plans
• Better brand image
• Long range impact and better
positioning
Strategic forward march :BATA

INDUSTRY SCENARIO
•Footwear industry at present “Rs
21,000 crores
•Growth rate :8-9 %
•Branded segment constitutes 40%
of market & would grow more than
50% in next 5 years
•Major brands : Liberty, Woodland,
Khadim, Metro, Redtape, and sports
wear brands like Nike, Reebok,
Adidas
 Strategic forward march :BATA
• Men's footwear accounts for almost half of the
total market with women's shoes constituting 40
per cent and kids' footwear the rest.
• According to industry estimates, the Indian
footwear retail market is expected to grow at
over 20 per cent from 2009 to 2011. Footwear is
expected to comprise about 60 per cent of the
total leather exports by 2011 from over 38 per
cent in 2006-07.
For Additional details pl contact
spgarg@jimj.ac.in
Mobile : 0 93092 92080