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Company profile

Date of Establishment Revenue Market Cap Corporate Address

1931 0 ( USD in Millions ) 53740.5776625 ( Rs. in Millions ) 6 A,S N Banerjee Road, Kolkata-700013, West Bengal www.bata.in Chairperson - P M Sinha MD - Rajeev Gopalakrishnan Directors - A B Anand, A Chudasama, A Singh, AB Anand, F M Hussein, J Carbajal, J G N Clemons, Jack G N Clemons, M K Sharma, M Villagran, Mahendra Ganatra, N Sankar, P M Sinha, R Gopalakrishnan, Rajeev Gopalakrishnan, Ranjit Mathur, S Sinha, U Khanna, Uday Khanna Leather Bata India is a footwear manufacturing company incorporated in 1931. The company was earlier known as Bata Shoe Company, later in 1973 the name was changed to the present one. The company manufactures footwear for men, women and children. The Company manufactures shoes of various quality such as leather, rubber, canva Total Income - Rs. 16775.529 Million ( year ending Dec 2011) Net Profit - Rs. Million ( year ending Dec 2011) AB Anand HDFC Bank, State Bank of India SR Batliboi & Co

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Business Operation Background

Financials

Company Secretary Bankers Auditors

Finished Products PRODUCT NAME Leather Footwear Rubber / Canvas Footwear UNITS Thousands Pairs Thousands Pairs INSTALLED PRODUCTION SALES CAPACITY QUANTITY QUANTITY 20256.00 42500.00 13564.00 6645.00 SALES VALUE (Rs Cr.)

24551.00 1089.0688 16162.00 300.7620

Plastic Footwear Accessories, Garment & Others Scrap Other Fiscal Benefits Other Services Finished Leather From Hides

N.A. N.A. N.A. N.A. N.A. Thousands Pieces

0.00 0.00 0.00 0.00 0.00 1596.00

0.00 0.00 0.00 0.00 0.00 110.00

8074.00 0.00 0.00 0.00 0.00 0.00

111.7068 61.8937 1.1419 0.4568 0.0475 0.0000

Bata India Limited Document Transcript

1. BATA INDIA LIMITED Repositioned Or Still a Foot wearyPresented by- Yugesh Kumar dubey (8279) Vinay Singh (8272) Vinay gupta (8271) External environmentWe have analyze various external environments from case as well as from outside source-Industry environment- Threat of new entrants-There are many barriers to entry preventing new entrants from capturing significant market share. Large footwear producer enjoy economy of scale that create cost advantage over any new rival.BIL differentiated its product from rivals product like Comfort (using dynamic spring pad that acted as cushion on the feet for womens footwear), Wind (in build air technology that allowed feet to breath fresh air) etc.The capital requirements are a high entry barrier to a new firm to the industry. However, an existing shoe manufacturer may enter the athletic shoe industry simply by re-tooling their manufacturing plant.Switching cost is very low for footwear industry because shoes are relatively inexpensive personal goods that are frequently replaced.Access to distribution channel is barrier to entry because it is really difficult for a startup firm to get shelf space at major shoe retailer. But existing firm may use their existing connections to easily access shoe distribution channel.Bargaining power of buyer-Bata was largest player in industry with 910%volume share and 60% market share in organized segment. It had a market share of 70% in canvas shoe segment and 60% in leather shoe segment. Their dominant market share give them power

over buyer.Bata is a big buyer of raw material who buys significant part of suppliers revenue. This in a way provides good bargaining power over suppliers.As a part of its strategic decision Bata set up a rubber/canvas factory in Faridabad, Haryana in 1951. So it can threaten its supplier to integrate backward.Bargaining power of supplier-Shoes are made of leather, rubber, nylon etc. These materials could be classified as commodities, where the manufacturing process adds the value. For this reason supplier have limited bargaining power over buyers.Threat of substitute productConsumer switched from one product to another if alternatives are available in same quality and performance range and have competing price or lesser price.BIL produces 10% of total hawai ranged from Rs. 35-110 while competing local brands were selling at Rs. 2550.Again when global trade open then market flooded with many international brands having variety and competing price.Rivalry among existing firms-Mostly numbers of competitors are stable, especially because of high entry barriers. This adds to the rivalry among existing firm. Manufacturers watch each other carefully and make appropriate countermove to match the competitors move. Leading competitor of BIL are Lakhani shoes, liberty shoes, action shoes, woodland, paragon and relaxo in organized segment. CompanyYear endedSales (Rs. Cr.)EPS(Rs.)Bata IndiaDec 2004698.512.2Lakhani IndiaMar 2004109.61.6Liberty shoesMar 2004177.215.9Mirza tannersMar 2004174.69.9Relaxo footwearsMar 2004200.74.4Source- capital market dated April 25-may 8 2005General environment-Demographic- Indian market is highly fragmented between rural and urban market. Rural market was large at approximately 70% of the total market but was dominated by multiple medium size regional players and serviced through traditional independent dealers.Political/legal environment-Industry is governed by central by Central Excise and Custom, Factory act and Labor Law and Environmental control acts.Council for leather export, Central leather research institute and Footwear design and development institute were promoting industry for special purpose.Political unrest, cross border unrest, terrorism in and out of India has direct or indirect impact on industry. When quantitative restriction was lifted from import then industry slowed down from 20 % (in 90s) to 8-10 %( in 2004). Increase in excise duty led to increase in cost of footwear (1993-94, excise exemption was withdrawn from shoe costing below rs. 200 and hence price went up by 20% and this led to drop in profit from 20 crore to 95 lac within a year).Tax holidays for period of 10 years on full excise duty and income tax and a subsidy on sales tax, land/building and plant/machinery was given by state government of Himachal Pradesh, Uttaranchal, Jammu & Kashmir and Assam to promote manufacturing. Global environment- India produced more of gents

footwear while worlds major production was ladies footwear. India has 10% of worlds raw material and low tanning cost made it second in footwear production after China. Sociocultural-Over a period of time, as disposable income increases, consumer preference changed but Bata failed to recognize these social changes and they continue with same product over long period of time.Internal environmentBIL is Indias largest manufacturer and marketer of footwear product which sold over 60 million pair per year in India and overseas market. Here in this section we will analyze resources, capability, core competencies and value chain of Bata India limited. By doing internal analysis we will identify strength and weakness of Bata India limited. Resources-Human resource-Footwear industry is labor intensive and concentrated in small and cottage industry area. Availability of human resource is one of important strength of Bata India limited. Below table will tell why this is strength-Labor cost in leading footwear producing

Brand Description: Brand Description Bata is one of the world leading footwear retailer and manufacturer with operations across 5 continents managed by 4 regional meaningful business units. With 1250 stores across the country, it also has the widest retail network.. Bata, over the decades, used the current knowledge .

Brand History: Brand History Bata Shoe Company is registered in Zlin . Innovative from the beginning it departs from century old traditions of the one-man cobblers workshop. The company was set up in Konnagar (near Calcutta) in 1932 which is known as Batanagar . It was also the first manufacturing facility in the Indian shoe industry to receive the ISO: 9001 certification. It operates 63 companies in various industries but footwear remains the core business with 60 million pairs sold per year in more than 30 countries.

Bata: Improving Market Share: Bata: Improving Market Share Bata today Serves 1 million customers per day Employs more than 40,000 people Operates 5000 retail stores Manages a retail presence in over 50 countries Runs 40 production facilities across 26 countries

BRANDS UNDER BATA 3 CATAGORIES : BRANDS UNDER BATA 3 CATAGORIES MEN WOMEN KIDS AMBASSADOR Rs.599-Rs5499 BATA Rs.599-Rs5499 COMFIT Rs.749-Rs2299 HUSH PUPPIES Rs.1699-Rs3299 MOCASSINO Rs.999-Rs1599 NORTH STAR Rs.629-Rs1699 POWER STAR Rs.699-Rs1599 QUOVADIS SCHOLLS Rs.1799-Rs2899 WEINBRENNER Rs.699-Rs2099 BATA Rs.539-Rs4899 HUSH PUPPIES Rs.539Rs4899 COMFIT Rs.599-Rs1299 MARIE CLAIR NORTH STAR Rs.539-Rs699 POWER Rs.1699 SCHOLLS Rs.1249-Rs1499 NAUTRALIZER RS.2999-RS3299 BUBBLEGUMMERS Rs.549-Rs649 BATA Rs.149-Rs899 SCHOOL Rs.149-Rs899 SPARX Rs749

The Product Life Cycle: The Product Life Cycle HUSH PUPPIES DR. SCHOLL WINBRENNER, NORTH STAR,BATA COMFIT, MARIE CLAIRE, BUBBLEGUMMERS POWER HAWAI (Sau paolo Alparagatas)

Marketing channels of : Marketing channels of Company operated retail outlet Dealer network Direct marketing to the customers

SWOT analysis: SWOT analysis Strength Worldwide presence Offers customer best value and great possible service Manages retail presence in 50 countries High demand in foreign market

Weakness: Weakness Losing competition because of the other big players like adidas, nike, woodland etc. Not too much stylist so it is losing the attraction of the customer, specially in the youth segment. They dont have any powerful brand ambassador to promote their brand. They havent promoted themselves thoroughly, invested very less in their add campaign.

Opportunity: Opportunity Bata India Limited has undertaken initiatives to improve the company's cost structure and margins. The company has initiated a financial restructuring exercise to down its interest cost. Financial re-engineering. The company has tightened controls on costs in all areas of and is looking at global sourcing for raw materials and other inputs. Bata India is also exploring third-party manufacturing units in Assam and Jammu & Kashmir as these enjoy tax holidays. Bata Shoe Organization (BSO) has decided to give a breather to its 51 per cent subsidiary.

Threat: Threat Introduction of new brands in the market. Lagging behind in terms of technological factors. Young generation is attracted to the other branded shoes like adidas, nike, woodland etc.

MENS TYPE: MENS TYPE DERBY LACE TO-TOE LOFER

Slide 13: LOW-BOOT MOCCASIN MONK-STRAP OXFORD

WOMENS TYPE: WOMENS TYPE ANKLE-BAR BALLERINA CHAPPLIES-MULE ESPADRILLE

Slide 15: HIGH-BOOT INSTEP-BAR PUMP SANDAL

Slide 16: SLING-BACK T-BAR Introduction of Bata India Limited: Introduction of Bata India Limited Bata India, a part of Bata Group Switzerland. Incorporated as Bata Shoe Company Limited on December 23, 1931 Kolkata, West Bengal. Changed its name to Bata Shoe Company Private Limited on April 6, 1956.

Converted to a public sector company on April 18, 1973. The name was subsequently changed to Bata India Limited on April 23, 1973. THE MOST TRUSTED FOOTWEAR BRAND

Bata Today: Bata Today Sells over 45 million pairs every year. Serves over 1,20,000 customers every day. Sells through over 1,200 retail stores. Operates 5 manufacturing facilities. Employs more than 6,800 people.

Average Footfalls: Average Footfalls Weekdays : 40 50 Weekends : 60 - 70

Visitors into Customers: Visitors into Customers

Marketing Strategies: Marketing Strategies

Bata Marketing Mix: Bata Marketing Mix

Strengths and Weakness: Strength Weakness Strong financial position. High goodwill. Different training facilities. Large no. of outlets. Serves family packages. Less variety. No proper advertisement. No powerful brand ambassador. Unrelated diversification. Strengths and Weakness

Opportunities and Threats: Opportunities Threats New medium to advertise. New product line. Be updated with new fashion & trend. Competition. Fast changing fashion trends. Opportunities and Threats

Major Problems of Bata India Limited: Major Problems of Bata India Limited Problem in switching to new product line. Unrelated diversification. Less variety of products as compared to others. Follows contemporary look. Doesnt follow trend. Mission: to acheive success and become the biggest n most successful multiple retaling n distirbution organisation with a dynamic n flexible market approach Todays consumer has multiple footwear needs for specific purposes, like dress, sports, outdoor, comfort, party, sports casual etc. Our updated and improvised shoe line is now better segmented to adapt to the ever changing needs of the consumers competitors BATIND Bata India Ltd. Bhartiya International Ltd. Crew B.O.S Products Ltd. Dharnidhar Global & Infraprojects Ltd. Euro Leder Fashions Ltd. KRM International Ltd. Lawreshwar Polymers Ltd. Liberty Shoes Ltd. Mayur Leather Products Ltd. Mirza International Ltd. Montari Leather Ltd. N B Footwear Ltd. Oscar Global Ltd. Phoenix International Ltd. BHAINL CREBO SEAGLO EURLED KRMINT LAWPOL LIBSHO MAYLEA MIRINT MONLEA NBFOOL OSCGLO PHOINT

Presidency Shoe International PRESHO Ltd. Pretto Leather Industries Ltd. Ramco Super Leathers Ltd. Relaxo Footwears Ltd. Sarup Tanneries Ltd. Somplast Leather Industries Ltd. Super Tannery Ltd. Superhouse Ltd. Tinna Overseas Ltd. Unimode Overseas Ltd. Welterman International Ltd. Worldwide Leather Export Ltd. PRELEA RAMSUP RELFOO SARTAN SOMLEA SUPTAN SUPLTD TINOVE UNIOVE WELINT WORLEA

VISION:Togrowasdynamic,innovativeandmarketdrivenmanufacturerand distributor,withfootwearindustrywhilemaintainingacommitmenttothecou ntry,culture,andenvironmentinwhichthecompanyoperates. MISSION:Tobesuccessfulasthemostdynamic,flexibleandmarketresponsi veorganization,withfootwearasitscorebusiness. OBJECTIVES:BataIndia,today,wishestorepositionitselfasamarketdrive n,fashionconsciouslifestylebrand.Cateringtoawidevarietyofcustomergrou ps,Batawillprovideitsproductsandservicestoalltheagegroupsinthecommun ity.Alsoaimstoprovidethefinestqualitythroughcustomerinvolvemen

BATA:SWOTANALYSIS Strengths 1.BrandImage 2.Reasonablequalityatloworreasonableprice 3.Diversitywithrangesinrunning,training,court,basketball,footballandOut door 4.Footwearfortheentirefamily 5.FinanciallyStrong 6.Convenientlyaccessibleoutletsinvariouspartsofthecountry 7.Targetingallincomesegments 8.Providetrainingformanagersandemployees 9.Nationwideretailnetwork Weaknesses 1.Nocontinuityofleadership 2.In2001,5%decreaseinnetsalesduetodiversificationintopremiersegment(i mpropertargetingandpositioning) 3.NoproperplanningregardingAdvertisementandPromotions 4.NovarietyinFashionableshoe Opportunities 1.Ecommerce 2.Acquired,Partnershipwithsmallplayers

3.EnteringnewsegmentsofMarkets 4.CapturingMarketwherenootherpotentialcompetitorexists 5.InnovativeProducts 6.Newmediumsforadvertisements. Threats 1.CustomerDissatisfaction 2.Pricewarswithcompetitors 3.Competitors 4.PoliticalInstability 5.EconomicThrea t6.Changinginconsumerpreference

Bata:TheMarketingPlan&Communication Themarketingplanincludesformulatingstrategiesandtacticsforeachofthe4 Ps:PRODUCT:BATAIndiahasmanybrandsunderitsoriginalbrandname BATA.Butweareconsideringdevelopingapromotionalcampaignonlyforth eproductcategoryofcasualfootwearwhichsellsbytheoriginalbrandname BATA. PRICE:BATAIndiaiscurrentlyconcentratingonthemiddleincomelevelseg mentforitsproductcategoryofcasualfootwear,thusthepricewouldberanging fromINR300to1500.

PLACE(DISTRIBUTION):BATASretailnetworkofover1200storesgives itareach/coveragethatnootherfootwearcompanycanmatch. PROMOTION:Thiswouldincludeintegrationofvariousmarketingtechniqu eslikeSalespromotion,ConsumerPromotions(GiftCoupons),TradePromoti ons(Count-RecountAllowances),Advertising,InstoreAdvertisingforgeneralshoeretailstores,andPublicRelations.Theseco mmunicationtoolsareusedinawaysuchthattheycomplementeachotherinthe communicationandpersuasionprocess.Takingintoconsideration,thepromo tionalelementsinbrief:SALESPROMOTION:SalesPromotionareoftwobroadtypes:1.ConsumerP romotions2.TradePromotionsConsumerPromotions:Thetoolalreadyinuse bytheBataIndiagroupisBataGiftVouchers.Thedesigningofthevouchersn eedtobecomplementarytothethemeusedforadvertisingsoastoreinforcethei mageofthebrand.Thesegiftvouchershavethefollowingfeatures:Convenient denominations6monthsvalidityRedeemableonallBataproductsAcceptable atover800BatastoresacrossIndia

TradePromotions:ThepersuasiontoolusedherecanbeCountRecountAllowance.Underthis,thediscountisappliednottothequantitythatth eretailerbuysfromthemanufacturerduringthepromotionalperiod,butonlyto thatquantitythatismovedfromtheretailersstores.Asaconsequence,theretail ergetsgreaterincentivetopassthepricecutontotheconsumersothattheproduc tmovesfromthestoreintotheconsumershands.Thistoolcanbeverybenefic ialforabrandlikeBatawhereconsumersareverybrandconsciousandhavehig hbargainingpower.

MESSAGESTRATEGYATTENTIONANDCOMPREHENSION Theattentionandinvolvementoftheaudiencedependsuponability,motivatio nandopportunity.ABILITYApersonismoreattentivetowardssomethingthe yreabletounderstand.Whattheadvertsays,thewaythespokespersontalksab outthebenefits/features,thelanguageusedisallveryimportantalongwiththef actwhetherthemessageiscomprehendibleornot. MOTIVATION Isthepersoninterestedenough?Apersonmaybeinterestedinaspecificproduct categoryApersonmaybekeenaboutaparticularwayofsendingacrossthemess age(languageused,humorused,jingles,etc.)ormediaused(newspapers).Can amessagebedesignedthatencouragesmaximumnumberofpeopletogetinvol ved?EgoInvolvement:Imagethatthepeoplecarryofthemselves.Connection betweentheegoofthebuyerandtheproduct(brand).Istheproductsomethingth atwouldenhancetheirpersonality?OPPORTUNITYIstheinformationreadil yaccessible?Doretailershaveenoughinfotobepassedontotheultimatecusto mers?Docustomersneedtosearchforinformation?(insuchcases,competitors areatadvantage)Istheadvertvisibleasmuchasrequired?COGNITIVERESP ONSEAspectsthatbuildCognitiveResponse:SupportArgument:TheComp anyagreeswithwhatevertheconsumerwantstobelieve.CounterArgument:T heCompanyclaimssomethingthatisusuallyunbelievable,i.e.audiencereject swhattheadverttriestosay.ExecutionBolstering:Whentheasisperceivedver ypositivelyandtheaudiencelikethepresentation(colors,charactersused,dc or,jingle)ExecutionDerogation:Whenthefeeloftheadvertisnotverygood.A udiencedoesntlikethewaytheadispresented

BATAsMarketPositioningPlans[Assumptions]Bataisplanningtoexitfro mthelowerendsegmentandfocusmoreonthemiddleanduppermiddleclassof thesociety,becauseofgrowthinthenumberofpeoplebelongingtothesesegme

ntsandtherisingincomelevelofitstargetcustomers.Theoverallmarketquite qualityconsciousnow.Bata,inordertodealwiththethreatoftheChineseimpor ts,wouldhaveastrategyfocusingprimarilyoncustomerintimacyasitwouldbe aimingtoenhanceitsbrandequitybyprovidingacompleteexperienceforfamil ieswhocometoshopatitsretailoutlets.AnotherpositiveforBatawillbethatth ecustomers,whoaremoreawarenow,usuallydonotassociatequalityandrelia bilitywithChineseproducts,whereasBatacanuseitsbrandtofillthisvoid.Al sorecentlyBatahasrecentlyrolledouttheveryhighqualityandpremiumprod uctsthatwereintroducedunderitsBatabrandin2001,becauseofthefactthatBa tasimagehasbeencreatedoveritsexistenceofaround40oddyearsandtryingt ojustmoveoutofitscurrentsegmentofthemiddleanduppermiddleclasspeopl eandtryingtocapturethehigherendofthemarketovernightcanbeanuphilltask forBatatosaytheleast