bata industries

7/30/2019 bata industries

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About Bata:

This company came into being in August 24, 1894.The T. & A. Bata Shoe Companyis registered in Zlin, Czechoslovakia by the siblings Tom, Anna and Antonn Bata.

Innovative from the beginning it departs from century old traditions of the one-man cobblers

workshop.

By 1905 Bata had grown too some 250-company employees. At 2200 pairs per day,

the personal effectiveness of each Bata employee far outdistanced the few pairs per day

produced by their predecessors.

New kinds of shoes were being introduced using new way to promote them. Batas

reputation as the innovative industry leader has been, maintained ever since. Despite the

outbreak of the first world wart material shortages, manpower shortages, corbels and other

challenges, sales increased to about two million pairs by 1917. Tomas Bata thinking in terms

of expansion into new markets even as a teenager, travelled to Vienna to sell his shoe to thecitys merchants, a young company, Bata exported shoes to the USA, Europe and North

Africa. By 1918, aggressive marketing and future foreign expansion could only guarantee the

likelihood of the companys 6,000 employees. In the early 1920s Bata established new

companies in Poland, Yugoslavia, Holland, Denmark, the United Kingdom and the USA.

New companies in Egypt, Belgium, Finland, Luxembourg, Hungary, Italy, Indonesia,

Singapore and India before Tomas Bata died prematurely in an airplane crash in 1937.

Following the death of the founder Tomas Bata, Mr. J. A. over saw international expansion.

In the early sixties, the Bata international center was build in Toronto, Canada deliberately

designed to present the building from being expand.

During the 70s, 80s, 90s the world-manufacturing base for footwear has shifted todeveloping countries, to the Pacific Rim and especially to China. Mr. T .G. Bata totally

utilizes the companys mission statement as a guideline for Bata Company operation .To be

successful as a dynamic flexible and market responsive worldwide organization with

footwear as its core business.

Bata Today:Bata is one of the world leading footwear retailer and manufacturer with operations

across 5 continents managed by 4 regional meaningful business units (MBUs).

Now, it includes shoe factories, tanneries, engineering plants, producing shoe

machinery and moulds, product development studies, quality control laboratories, hosiery

factories and 6300 retail stores and 100,000 franchises more than 60,000 people have beenemployed, producing and selling approximately 270 million pairs of shoes each year,

primarily for internal markets. An additional 40,000 people and their families depend on jobs

in support services created by Bata operations. Now the foundries grandson controls all these

affairs.

Bata today: Serves 1 million customers per day Employs more than 40,000 people Operates 6300 retail stores Manages a retail presence in over 60 countries Runs 40 production facilities across 26 countries Companies 75 in 60 countries


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Bata's 4 Business Units: Bata Europe, Lausanne Bata Asia Pacific-Africa, Singapore Bata Latin America, Mexico Bata North America, Toronto

VisionTo grow as a dynamic, innovative and market driven domestic manufacturer and

distributor, with footwear as our core business, while maintaining a commitment to the

country, culture and environment in which we operate.

MissionTo be successful as the most dynamic, flexible and market responsive organization,

with footwear as its core business

Marie Claire Hush Puppies Power Bubble Gummers North Star Scholl Weinbrenner Bata Comfort North Star

Bata is a multinational company, which has various brand lines in order to satisfy thevarious segments of market. All the above-mentioned brands are devoted to make best quality

of shoes for the particular segments they are assigned. Below is a brief introduction to the

various brands of Bata pvt Limited.

Marie Claire shoes are for women with an active lifestyle who

seek contemporary modern styles, Marie Claire shoe stores

successfully opened in Latin America and Asia. (Except in Japan

and Korea)


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Bubble gummers is the leading

children's footwear brand in Pakistan and has an extensive

presence in Latin America, Asia and Europe. Bubble

gummers offers good quality, comfortable, funny and

colorful shoes for kids.

In 1958, during the exciting atmosphere of change the

Wolwerine Company created the world's first casual shoe and

provided a new alternative in footwear. Hush Puppies

emerged as a soft, breathable and very comfortable shoe.

Power is a Bata International Brand, which continues to spark an

emotional connection with the masses by providing athletic

footwear at very affordable prices. First launched in 1972, it has

created a niche for itself in the sports segment.

Power Slogan: Be Smart

A new terminology replacing Value, The Power customer is a

Smart consumer, not just a value consumer.

Dr Scholl's from Bata provides you with maximum comfort

completely daylong. The unique Anatomic Insole will give

your feet that extra cushioning needed to keep all stresses at

bay from your feet while providing support from all sides.

The Weinbrenner line consists of leather shoes and boots, low,

mid and high cut. Cuts or designs are dictated by fashion, butalways in casual style. OUTDOORS IS YOURS is a tagline

commonly used.

Comfort will be an important feature in

design and assembly of all the comfit shoes. Many of the Desirable

and characteristics such as double stitching molded and latex foam

insole, soft textile or cambrelle lining will be used to emphasize the

brand image of both comfort and style. Get Comfortable Today is

a tagline commonly associated with these range of shoes.


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It's a casual yet fashionable street-style shoes that caters to

the young at heart.

Leena is the latest ladies brand of Bata in which Bata

offers the huge range of sleepers for ladies in different

colors variation and designs.

BATA PAKISTAN LIMITED

Batapur came into being in 1942 at distance on 18 km. from Lahore with due entrepreneurial

dynamism it expanded and grew rapidly presently claiming to be the largest shoe-

manufacturing unit in Pakistan.

DESCRIPTION OF VARIOUS DEPARTMENTS

There are many departments in BPL that are described under below:

o Personal departmento Finance departmento Purchasing department

Local Purchase Imports

o Marketing departmentOther departments as:

o Tanneryo Production department

Leather factory Plastic factory Rubber factory

o Designing departmento Laboratoryo Merchandizing department

Seasonal planning 8 week forecast 4 week forecast 1 week forecast

o Costing departmento Training departmento Distribution department

Porters 5 Forces


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1. 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. Bata has been differentiated its product from rivals product like comfort, wind 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 theirmanufacturing plant.

Switching cost is very low for footwear industry because shoes are relatively inexpensive

personal goods that are frequently be replace.

Access to distribution channel is barrier to entry because it is difficult for a startup firm to get

shelf space at major shoe retailer. However, existing firm may use their existing connections

to easily access shoes distribution channel.

2. Bargaining power of buyer:-Bata was largest player in industry with 9-10%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.

3. Bargaining power of supplier:-Shoes are made of leather, rubber, nylon etc. These materials can classified as commodities,

where the manufacturing process adds the value, for this reason supplier has limited

bargaining power over buyers.

4. Threat of substitute product:-Consumer switched from one product to another if alternatives are available in same quality

and performance range and have competing price or lesser price. Bata produces 10% of totalHawaii ranged from Rs. 35-110 while competing local brands were selling at Rs. 25-50.

Again, when global trade opens then market flooded with many international brands having

variety and competing price.

5. 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 counter move to match the competitors move. Leading competitor of Bata are

Lakhani shoes, liberty shoes, action shoes, woodland, paragon and relaxo in organized

segment.

ENVIRONMENTAL FACTORS

These factors affect organizations performance directly or indirectly. These categorized as:

Macro factors

Micro factors

Macro Factors:-

Economic Factor:As far as Bata is concern, it is also effect by the economical factor. Doing business in

Pakistan, they have to watch the economic condition of Pakistan. Purchasing power of people

is very important. However, during the last 2 years purchasing power of people have been

decreased so its effect the business of Bata in Pakistan. Another factor is that, in making of


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leather, petrol is used and prices of petrol in Pakistan is increasing day by day so it increase

the cost of production of Bata company.

Political Factor:

Like other organizations, Bata also has to obey the laws, rules and regulations existing

within the country. In Pakistan, we have a very friendly business environment, the regulationsand rules are very easy to apply and follow. For example for Bata, industries there are no

restraints and no limitations to stop the expansion of their business. They have no reason to

slow down their production or distribution nor their publicity or marketing.

Social & Cultural Factor:

Bata is producing its products in more than sixty

countries worldwide. Every country has different

culture, norms and values so that Bata have to

vary its strategies according to the geographic area

Bata advertise its products according to the

cultural aspects, it means Pakistani ads aredifferent from Canada. e.g. In Pakistani Bata ads,

they always show the family concept to promote

their product.

Technological Factor:

As far as Bata is concern, it is also effect by the technological factor. Bata is good in

technology, having latest technology. Moreover, to remain at this high level of technology,

Bata must focus on the trends changes in technology and they adopt it immediately. By the

change in customer perception, then there is change in demand, need, the fashion and then in

technology as well. Bata is always trying to focus on the change in technological market.

International Factor:

As for as Bata is concern, ever since the import and distribution of Chinese products namely

shoes, has increased in Pakistan, the sales of Bata have dropped considerably. Thus, the

business of Bata industries has been affect by an international factor in the form of low labor,

and manufacturing costs of Chinese products. In the process of countering this situation, Bata

industries contracted with Chinese manufacturers for low costing and cheap products.

Therefore, they can have a leveled competition in the local and international market.

Micro Factors:-

Customer and Clients:Bata Collections target a wide range of customers and offer an excellent price- quality ratio.

Batas exclusive models, along with national and international brands are carefully select and

then updated in response to market demand.

However, how the customer affects? Bata is always trying to fulfill the needs of their valued

customers by giving new initiatives. If Bata fail to do this job then the Batas business

strategies and business become fails.

Competitors:

Competitors are other organizations with a high potential, offering rival products or services.

e.g. Servis shoes, Stylo, Delhousy, English and many other high standard industries, which

compete with great strength and tact.


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In early days of Bata in Pakistan, they have no such competitors. During the last decade lot of

shoe making companies have been arrived so Bata have to face the competition. Because

local competitors prices are relatively low as compared to Bata.

Suppliers:

Batas suppliers are Chinese raw material holders, manufactured supplies from local cottageindustry etc. The impact of suppliers on Bata is that if the prices of raw material increase, it

directly affects the companys marketing mix strategy. The result is that the price of products

increases.

Employees:

Bata is always employing the correct staff and keeping these staff motivated which is an

essential part of the strategic planning process of an organization. Bata always focus on the

training and development of their employees, which plays an essential role in-order to gain a

competitive edge. If Bata hires unskilled employees, the impact will be bad.

Other competitors with market shares listed below:Bata 15%

Share of Servis 09%

Milli Shoes 3%

Hang Ten 1%

Others 65%

e.c.s 7 %

Total 91%

Bata Pakistan Strategy in accordance of competitors:

Product development has been a source of pride to Bata

companies and allowed Bata to stand apart from other

manufacturers. From shoe innovation centers in Canada,Mexico City, Italy and Indonesia, to styling and technical

designing detailed and provided Bata various

manufacturing facilities around the world. Research is

conducted into the application of new technologically

advice materials to new shoe making processes.

Other competitors with market shares listed below:

Bata 15%, E.C.S 7 %, Milli Shoes 3%, Hang Ten 1%, Others 65%, Total 91%

Shares of Servis 09 % Grand Total: 100%

SWOT Analysis of the Company:

Every individual and the company have SWOT. Progress of company can be enhancing by

SWOT analysis. Here is a review of the companys SWOT analysis.

Strengths:

Bata has ISO-Certificate: 9001

Product development has been a source of pride to

Bata companies and allowed Bata to stand apart

from other manufacturers. The company is a

quality manufacturer, believes on customersatisfaction and comfort. While producing any


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product the issue of comfort ability, needed product and needed quality has been, keep in

mind. That is why the company has introduced different brands for all classes of society and

for all age groups in order to attract the attention of its customers. All the operations of the

company are according to the laws of Pakistan Trade Policy. Company pays full of its Sales

Tax and Income Tax as well as other duties to the Government. Company plays a vital role in

representing its country as they manufacture for export purpose also.

Weaknesses:

Not too much stylist so it is losing the attraction of the customer, especially in the youth

segment. Therefore, it is losing competition because of the other big players like adidas,

Nike, woodland etc.

They do not have any powerful brand ambassador to promote their brand. They have not

promoted themselves thoroughly, invested very less in their add campaign.

Opportunities:

Retailing is a big opportunity for the company. Foreign markets and importers are another big

opportunity for the company. There is still potential in the market.

Threats:

Every threat is a big opportunity on the other hand. The company faces a big threat in market

as some of the businesspersons have started buying products from the cheaper markets of the

world as China, Vietnam etc. and they sell it here at lower prices. Customer in Pakistan

specially falls on low price that is why Quality brand makers are facing this thing as a big

threat. Some of the other threats are Government Duties, High Sales Tax Ratio etc.

Strategies by Bata in Pricing:

1. For finding opportunities and evaluation of new initiatives, Bata uses the Price RangeStrategy. By using this technique, Bata find the gaps for new initiatives and its position

among competitors.2. For the concept testing before developing and launch a new product, Bata capture the views of customers through questioning.3. For evaluation of the organizations capabilities, Batas managers held a meeting wherethey discuss about capabilities. Either they are able or not for developing new product.

Price Range Strategy:

Bata Shoes Ltd. is using Price Range Strategy for finding the opportunities and evaluation the

new initiatives among competitors.Bata prepare one sheet on which all the competitors products, brands, category and prices as

well as Batas products, brands, category and prices are list. With the help of this format Bata

find out the new product or new category in new price range that is missing in Bata andcompetitors offers to their customers.

Recognition of Organization Capabilities:

Third is the recognition of organization capabilities. This is a judgment of capabilities that is

required for new product development. According to our visit in Bata Shoes Ltd, we collect

the information in this area. In Bata Shoes Ltd, there is no any specific technique use by Bata.

When idea is select then all the managers are arrange in a meeting, it may be for a day or for

a week, where they decide that they should develop the product or not.


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Bata arrange a meeting of all managers, general managers and directors of all departments.

The departments like:

Finance Marketing R&D Production/Manufacturing Store CAD / CAM etc.

All the managers, general managers and directors sit together and talk about on all aspects

with the help of all required documents that prepared by all departments managers and held

presentations as well.

REFERENCE

www.bata.com.pk

www.google.com

www.servis.com.pk

bata industries

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