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The Bata Shoe Organization was founded in 1894 by Czech businessman Tomas Bata in the city of Zlin, what was then Czechoslovakia. Coming from a family of shoemakers with a long heritage of eight generations and over three hundred years, Tomas Bata capitalized on knowledge, expertise and skills to propel his newly founded company forward. The introduction of factory automation, long distance retailing and modernized shoe making ensured the profitability of the company from the very beginning. It is now the world’s largest manufacturer and marketer of footwear operating across the globe. Today the Bata Shoe Organization is a sprawling geo-centric company encompassing operations in more than 70 countries around the world and is managed by 4 regional commercial business units (CBUs) across five continents. It serves 1 million customers per day, employs more than 50,000 people, operates 5,000 retail outlets, manages a retail presence in over 70 countries and runs 27 production facilities across 20 countries.
2.0 COMPANY PROFILE
Bata Bangladesh is affiliated to the Bata Shoe Organization, the world's largest footwear manufacturing and marketing organization. It started operations in 1962 in Bangladesh. Bata incorporated in Bangladesh as a publicly traded company listed with Dhaka Stock Exchange. They have 60% of overseas shareholding and 40% local Bangladeshi Shareholders. Currently Bata Shoe Company (Bangladesh) Limited operates two manufacturing facilities – one in Tongi and the other in Dhamrai. With a production capacity of 110,000 pairs of shoes daily, the company also has a modern tannery facility with an output of 5 million square feet of leather annually. Annual shoe sales currently stand at slightly more than 30 million pairs with a turnover for the year. It employs 3000 employees and more than 35,000 families are directly or indirectly depending on the company together with its 650 local suppliers and 72 Associates
The Strategies of Bata Shoes Bangladesh Ltd. The associates are mostly Muslim and they contribute regularly towards the building of our national economy. Human Resources Management and Chief Finance Officer. Vision Should maintain our competitiveness and leadership in the shoe market with our aesthetic functional standard and cost effectiveness with increased market participation by ensuring regular return to our shareholders. Head of Accounts. 2|Page . agencies. These levels are as follows: Top Level Management These include Decision making and implementation of activities like Managing Director. Business Units. wholesale depots and large number of registered distributors and dealers.0 MANAGEMENT OVERVIEW In Bata Shoe Bangladesh Company’s working environments is maintained through Different Management Levels. The company’s marketing network is consolidated through its own retail outlets. Mission Introduction of a strong shoe line targeted to various market segments to maintain leadership through increased market share. 3. franchises. distributors. Today “ Bata” is not only the household name in Bangladesh it is also a very popular brand name among all ages of customers in Bangladesh and a symbol of trust and confidence for providing good quality durable footwear for all segment of customer.
1: Organogram of Bata Shoe Bangladesh Ltd.The Strategies of Bata Shoes Bangladesh Ltd. Purchasing department activities and decisions. Retail Integrated Merchandising System. Production department. Low level Management All the department’s employees and supervisors are includes in this level. Online Sales System. 3|Page . Mid level Management These include Inventory Management System. ORGANOGRAM OF BATA SHOES BANGLADESH Managing Director Head Of HR Head Of Accounts Chief Finance Officer Head Of Retail Marketing NRSD Manager Production Manager Purchasing Manager Product development Manager Merchendising Manager Fig 3. They continuously monitor the wholesalers and retailers.
It produces different types of very good quality plastic and Thongs for women. The Mari Clare brand of Bata is for women. In recent times Bata has targeted the young working woman who wants reasonably priced. according to them 0-13 years of age group. The pick seasons for Sandak shoes are rainy season when many prefer this shoe. The price range here starts from Taka 450. Bata shoes have been time tested to be the most reliable in durability and accessibility. Men/Women Sandals. They care for clients across the board with a wide range of styles at reasonable prices.0 PRODUCT LINE Bata Bangladesh has various types of Men/Women Shoes. 4|Page . Sandles of Sandak brand of Bata serves that very segment of the market. Bubblegummer brand has provided Varity of design and type of shoes for abovementioned age group of children. 4. From my survey it has found that it is the most popular shoe of Bata. and Leather Accessories.The Strategies of Bata Shoes Bangladesh Ltd. decent design and durable shoes for work and this brand in many cases serves this segment well. Belts. It has more than 100 designs and has different price range of shoes. The Bubblegummers brand of Bata serves the infant to children. which are washable and decent in looks. Bags.
and in many cases not exceed more than thousand taka. Apart from these Bata has numbers of leather sandals of various designs. outdoor. The price range starts from 695/. The most popular brand of school shoes that are now in the market are North Star which provides hard and soft white sneakers and the leather black Bata school shoes which are of various designs.Schole’s and Nike in this region of south Asia. Which quickly earn recognition among the parents of that time. This brand of Bata provides trendy. Dr. Though the brand is not that cheap but the quality of it is very good. The target segment of Power is teenagers and some parts of the elderly people who need sneaker for walking purpose. rough use footwear for men. Quickly they introduced the “Naughty Boy” shoes. as they need a durable shoe that really can last even after lots of rough treatment. hard top white sneakers for school goers. Bata Flexible. From there on Bata gone on to make Canvas shoes. According to the buying power this price range is very popular with the general public as durability comes with every Bata footwear. other black leather shoes. sandal-shoes under Bata brand name that serves different segment of the market. This is a reasonable priced good quality sports shoes and sandle shoes for young male and female.The Strategies of Bata Shoes Bangladesh Ltd. This is also a popular brand with the youth of the country. Bata also have quite new brands for male and female like Bata Comfit. When it first comes to this country it has realized that there is a huge market opportunity for school shoes. According 5|Page . Bata first earn its name as the most durable shoe manufacturer for school going children. Bata also manufacture and market popular brands such as HushPuppy.
France and Canada. hosiery. New Zealand. The company also exports its products to countries like Germany. Australia.1: Distribution Process of Bata Shoes Bangladesh ltd. Holland. and other footwear accessories like socks.The Strategies of Bata Shoes Bangladesh Ltd. etc. 6|Page . Distribution Process of Bata Bangladesh Tongi Factory Raw Materials Dhamrai Factory CDC(Central Distribution Center) Own Stores & Agencies Depot Dealers & Wholesalers Fig 4. to the Bata officials in Bangladesh Bata have more than 1000 lines of footwear’s here in Bangladesh at present. UK. USA. shoe polish. Denmark. Bata also markets sportswear. readymade garments.
International Market Strategy 7|Page . National Market Strategy 4.The Strategies of Bata Shoes Bangladesh Ltd. Regional Market Strategy 3. The specifics of the strategy is provided belowDefinition: Serving the overall market with one or some other kind of offerings. Single-Market Strategy 2. Expected Results: Higher Sales. Higher Market Share. Requirements: Carefully selecting all the segments and providing offerings to all. 5.0 STRATEGIES USED BY BATA BANGLADESH Market-scope strategy choices 1. Total-market Strategy Among the three choices Bata has chosen and uses ‘Total-Market strategy’s they serve all classes of people with their shoes ranging from 30/--2195/-. Market-Geography Strategy choices 1. Objective: To diversify the risk of serving only one market. Avoid confrontation with companies serving the entire market. Multi-market Strategy 3. Local-Market Strategy 2.
Though it is a MNC it operates quite freely here in Bangladesh and operates as ‘National-Market Strategy’. Increased market share. Among the market-Geography Strategies Bata Bangladesh follows the 'National-Market Strategy’ in Bangladesh as they distribute their product to the whole of Bangladesh using their own and Danish's distribution channel. First-In Strategy 2. Early-Entry Strategy 3. Two modes of entry are feasible: Conventional marketing strategy Initiator.Entering market with unconventional marketing strategies 8|Page . Expected Results: Increased growth. Definition: Operating nationally. Bata Bangladesh uses ‘First-In strategy’ which is characterized by the following: Definition: Entering market during the introduction stage. Willingness to take risks. Laggard-Entry Strategy Among the Market-Entry choices. Keep up with competitors Market-Entry Strategy choices 1. Objective: To seek growth.The Strategies of Bata Shoes Bangladesh Ltd. Requirements: Top management commitment. Capital Resources.
At the same time it offers variety of products. Requirements: Market research ability. Concentrate all energies on these markets. Key Markets Strategy 4. Harvesting Strategy Among the market-dilution strategies. Production capability. Pruning-of Marginal Markets Strategy 3. Definition: Focusing on overall market and take out the invested profit. Objective: To serve the market well where they are now. Requirements: Gain continuous knowledge of the local markets. Expected results: Putting market on a new growth path. Bata Bangladesh uses kind of harvesting strategy in many cases.The Strategies of Bata Shoes Bangladesh Ltd. De-marketing Strategy 2. 9|Page . They also come up with the key markets strategy. Market-Dilution Strategy 1. Increased profits. Develop unique strategies to serve the chosen markets. Objectives: To understand the market first and reap the profit at the beginning and waiting for the competitors and strike them with good lowering price and improved quality. Some growth opportunities.
10 | P a g e . Product-Design Strategy 6. Objectives: Position product in market so that it stands apart from competing brands. what you are. Product-Overlap Strategy 4. Product-Positioning Strategy 2. Product-Scope Strategy 5. Increased market share in the selected markets. Diversification Strategy Among the product strategies Bata Bangladesh has used 'Product-Positioning Strategy' and 'Diversification Strategy' which is characterized by the following: Product-Positioning Strategy: Definition: Placing a brand in that part of the market where it will have a favorable reception compared with competing brands. Product Repositioning Strategy 3. New-Product Strategy 8. Product Strategy choices 1. Expected results: Increased profits. To position the product so that it tells customers what you stand for. Product-Elimination Strategy 7. how you would like customers to evaluate you.The Strategies of Bata Shoes Bangladesh Ltd.
Distribution Strategy: Definition: Developing unfamiliar products and markets through Concentric diversification (products introduced are related to existing ones in term of marketing or technology). Expected Results: Meet as much as possible the needs of specific segments of the market. In the case of positioning multiple brands: To seek growth by offering varied products in differing segments of the market.The Strategies of Bata Shoes Bangladesh Ltd. Thus it is important to be careful in segmenting the market and to position an individual product as uniquely suited to a particular segment through design and promotion. Requirements: Use of marketing mix variables (design and communication efforts). Successful management of a single brand requires positioning the brand in the market so that it can stand competition from the toughest rivals and maintaining its unique position by creating the aura of a distinctive product. Objectives: Diversification strategies response to the desire for- 11 | P a g e . Limit sudden change in sales. Successful management of multiple brands requires careful positioning in the market so that multiple brands do not compete with nor cannibalize each other. and Conglomerate diversification (products are entirely new). To avoid competitive threats to a single brand. Make customers faithful to the brands. Horizontal diversification (new products are unrelated to existing ones but are sold to the same customers).
Objectives: To discourage competition from entering market by quickly taking large market share and by gaining cost advantage by realizing economies of scale. Greater profitability and flexibility. Stability by spreading the risks of fluctuations in earnings. Pricing Strategy choices: For new products: Skimming Pricing Penetration Pricing At times Bata Shoe Company in Bangladesh used 'Penetration Strategy' which is characterized by the following: Definition: Setting a relatively low price during the initial stages of a products life. a business unit shouldDiversify activities only if current product/market opportunities are limited. Growth when current products/markets have reached maturity.The Strategies of Bata Shoes Bangladesh Ltd. Security when the company may fear backward integration from its major customers. Provide the products introduced with adequate support. and Credibility to have more weight in capital markets. Have good knowledge of the area in which it diversifies. Requirements: In order to reduce the risk inherent in a diversification strategy. and Forecast the effects of diversification on existing lines of products . 12 | P a g e . Expected results: Increase in sales.
requests or 13 | P a g e .). Low margin on sales. Requirements: Firm's served market is not significantly affected by changes in the environment. Expected Results: High sales volume and large market share. Demand must be highly elastic in order for firm to guard its cost advantage . Lower unit costs relative to competition due to economies of scale. etc. market share.The Strategies of Bata Shoes Bangladesh Ltd. profitability. Requirements: Products must appeal to a market large enough to support the cost advantages. To enhance public image. Reducing the price 3. Firm's public image could be enhanced by responding to government public opinion to maintain price. Uncertainty exists concerning the need for or results of price change. For established products choices: 1. Increasing the price When the products of Bata Bangladesh were established in the market they used 'Maintaining the price Strategy' which is characterized by the following: Objectives: To maintain position in the market place (i. Maintaining the price 2.e.
The Strategies of Bata Shoes Bangladesh Ltd. Enhancement of the firm's public image. 14 | P a g e . Flexible-pricing Strategy 3. One-Price Strategy 2. Price-Leadership Strategy 7. To maintain goodwill among customers. Information concerning cost variability of offering same price to everyone. Price-Flexible Strategy choices 1. Pricing Strategy to build market Share Among the price-flexible strategies. Knowledge of the economies of scale available to the firm. Product-Line Pricing Strategy 4. Leasing Strategy 5. Expected Results: Status quo for the firm's market position. Bundle-Pricing Strategy 6. Requirements: Detailed analysis of the firm's position and cost structure as compared with the rest of the industry. Objectives: To simplify pricing decisions. Bata Bangladesh uses the 'One-Price Strategy' and the 'Pricing Strategy to build market Share' which are characterized by the following: One-Price Strategy: Definition: Charging the same price to all customers under similar conditions and for the same quantities.
Requirements: Enough resources to withstand initial operating losses that will be recovered later through economies of scale. Promotional Strategy choices 1. Objectives: To seek such a cost advantage that it cannot ever be profitably overcome by any competitor. Stable market. Expected Results: Start-up losses to build market share. Promotion-Expenditure Strategy 2. High elasticity of demand. Creation of a barrier to entry to the industry. Favorable and fair image among customers. Promotion Mix Strategy 15 | P a g e . Pricing Strategy to build market Share: Definition: Setting the lowest price possible for a new product . Large market. information on the price that customers are ready to pay.The Strategies of Bata Shoes Bangladesh Ltd. Constant profit margins. Expected Results: Decreased administrative and selling costs. Price-sensitive market. Information on competitive prices. Ultimately cost leadership within the industry.
At least their lack of advertising in the electronic and print media and their target of coming up with new stores reflect that. 3. Selling Strategy 6. Media-Selection Strategy 4. Sales Motivation and supervision Strategy Of all the promotional strategies Bata Bangladesh as we observed followed the selling.The Strategies of Bata Shoes Bangladesh Ltd. They try to be at the doorstep of people with their store rather than intense advertising. Economic Environment Key Elements of Marketing Strategic Formulation 16 | P a g e . But they give some ads to the newspaper on their new arrivals sometimes. Advertising Copy Strategy 5. Key Elements of Marketing Strategic Formulation Political and Legal Environment Technological Environment Customer Marketing Strategy: Achieving maximum Positive differentiation Corporation Competition Social Environment Over competition in meeting Customer needs.
Puma. Reebok.middle to Apex. Some sole from other subsidiaries of Bata like India and China Bata COMPETITORS: BUYERS: Infant. old. Lower. leather from local source. low quality footwear 17 | P a g e . young. Jennys. Inability to catch the present trend in time Less competitive price due to high cost structure. 6.0 LESSONS I LEARN FROM BATA SHOES BANGLADESH Positive Output from Bata Shoes Bangladesh Image of the company Quality Product Differentiated line of products Competitive Pricing Strong distribution channel Modern manufacturing facilities Brand loyalty at mass level Negative Impact on Bata Shoes Bangladesh Insufficient promotional activities Bata at present conducts all the store management activity manually. Jennys. Reebok.The Strategies of Bata Shoes Bangladesh Ltd. teen. Liberty Smuggled shoes upper class SUBSTITUTE Bare foot. VAT & tax barrier I also found the 5 forces of competition for Bata Shoe Bangladesh NEW ENTRANTS Apex. Woodland MAJOR SUPPLIERS Rubber from local source.
0 REFERENCES www. and downward trend of quality. In very few sides Bata has lacking. 8. More advertisements should be aired. Based upon these facts recommended strategies would assist in more growth of Bata shoe company Bangladesh Ltd.0 CONCLUSION From the analysis of Bata Shoe Company Bangladesh Ltd and the shoe industry i have identified that the shoe industry is growing and identified their main weakness is insufficient lack of development with the rapid changing market needs. Reduce the price level. insufficient promotional activities. 9. To merge with the local companies and to expand more segmentation.com Annual Report 2010 Various Secondary Sources 18 | P a g e . 7. color. in among the upcoming fierce competition in the shoe industry.batabd.The Strategies of Bata Shoes Bangladesh Ltd. and design combination to be competitive. we see that Bata is taking corrective steps in almost all the way. Should build awareness among the potential users of this type of footwear product. Bring more design. distribution system and vertical integration are the strengths of Bata From strategic marketing viewpoint. On the other hand.0 RECOMMENDATIONS Give sales discount and free samples to influence more sales in the growing shoe market.