BATA

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. Since its founding, Bata has been at the
forefront of innovation; not only in the production and design of new styles but in the creation of
business models that permit a quick response to the ever-changing wants and needs of our
customers. As a result, Bata enjoys a long history as a leading manufacturer and retailer of
quality footwear, and proudly serves some one million customers each day. Today the Bata Shoe
Organization is a sprawling geo-centric company encompassing operations in more than 70
countries around the world. It serves over 1 million customers per day, employs more than
30,000 people, operates more than 5,000 international retail outlets, manages retail presence in
over 70 countries and runs 27 production facilities across 20 countries. Bata’s reach is
worldwide; its presence is local. Our novel international manufacturing structure allows Bata
facilities around the globe to respond to the unique needs and wants of local customers. As a
result, Bata is honored to be a local company in every country it serves. Bata continues to be
guided by the same core principle it has followed for over one hundred years: to know its
customers and to create the best possible products to meet their needs.

In Bangladesh, Bata started its operation in 1962. Currently Bata Shoe Company (Bangladesh)
Limited operates two manufacturing facilities – one in Tongi and the other in Dhamrai. With a
production capacity of 160,000 pairs of shoes daily. Annual shoe sales currently stand about 30
million pairs.

Future Goals of BATA

Goals provide by BATA shoes:
1. Give your grade gadgets. Excellent quality is an essential typical reason mentioned by purchasers for
purchasing right from farm owners. Flourishing online marketers prevent potential consumers with
perform deals of the level of quality goods.

2. Increase effective people skills. Disposition is crucial to your commercial enterprise successes. A
private inventory with your attributes, plans, and interests can help ascertain your attitude and power to
connect with a large mixture of consumers. People skills are necessary to direct marketers. When you find
yourself not really “people person” the chance for strong development and marketing victory is sleek,
despite having a motivated consideration and are looking for to the office meticulously by using your
clients. Decide if just one more wife and kids member if you should do not offer the people skills needed.
may come alive the spot where you do not. Do not be amazed if your sons and daughters transform outs
becoming a gross sales “star.”

3.Know your website visitors. Let them know that you can recognize the value of their industry. Everyone
figures someone that requests us by identity or inquires about us or a family member. The possible
individual is apt to buy from somebody who usually takes the effort to offer their own personal contact.

4. Use desirable packaging. Product packaging may help make the selling for many things. You want to
reconsider your packaging and content label. Any holiday period also can give you a way to enhance your
normal merchandise by way of a cherished look.

5. Permitted prospects check out samples. The sample is a really impressive solution to draw customers to
your solution. Going for the taste of products could influence someone that rate does not really make a
difference for a really good-flavored solution.

6. Be prepared to change. People are usually looking for new releases. Millions of brand new foodstuff
offerings are released in the United States this present year. The changes in a number of goods, when you
are likely to marginal, provide something more challenging or varying to seduce customers. You may
want to change your tool, your plan, you're endorsing or show to boost your charm valued clients. Food
markets have found that bringing in new services plus more! prevalent upgrading is very important to the
achievements of their internet businesses. Computer monitor the competition and very happy to think
about differences and a new product using your judgment, past experiences along with your read through
on your individuals.

Their Mission:

We help people to look and feel good by continuously focusing on product quality,

innovation, and value.

We become the customer’s destination of choice by offering a personal shopping

experience to create long-standing customer relationships.

We attract and retain the best people by showing great leadership, a passion for high

standards, our respect for diversity and a commitment to creating exceptional opportunities

for professional growth.

 We remain the most respected footwear company by socially responsible and ethical.

Business Unit Goals of BATA:

Financial Goals:
 Profitability and Revenue
 Margins and Percentage of Total Revenue
 Cash Flow Accounting
 Debt Service Management

Organization structure:

Name of Designation
Management
Chitpan Kanhasiri Managing Director
Mr. Muhammad Sohail Aslam Finance Director
Mr. Syed Zahidul Islam Head of Human Resource
Mr. Omar Faisal Chowdhury Non Retail Sales Manager
Mr. Patricio Andres Alegris Oteiza Product Development Manager
Mr. Lee Sin Kee Retail Manager
Mr. A. A. Md. Arfanul Hoque Merchandising Manager
Mr. Jalil Ahamed Chowdhury Supply Chain Manager

Marketing Strategy & Communication:

The main objective of the strategy communication is to create awareness and interest in
customers of the new product, which in-turn benefits the organization to capture the market share
and increase its contribution (profit). This is done by the AIDA model, where attention, interest,
desire and necessary action is done for the demand in the market.

Awareness of the new product: Generating awareness is done through advertising in media like
TV, newspaper, magazines, banners, and the internet. When this is done, the customers will be
aware of the new product in the market.
Creating Interest: Done through advertising by emphasizing formal products such as brand name,
features, comfort, and latest design. Thus creating an interest in the customer’s mind for the new
product.

Arousing Desire: This can be done through sales promotions, word of mouth from the customers,
who have already used the product.

Actions: When all the above strategic plans are done, the product must be made available in the
market. If in case the product is not available, the customer gets disappointed and they find a
substitute for their needs, which decrease the reputation of the brand and the company’s profit.

Assumption:
Bata in Bangladesh has around 13.7 percent of the market share and the company has decided to
increase its market share by introducing a new product under the brand Power in the market.
Power brand is exclusively meant for sportswear. The company expects to have an increase of
3.25 percent in its market share by introducing this product. The product to be launched is named
as Power – Lite. It sells around 45 million pairs every year and has decided to increase its sales
by introducing Power- Lite. The decision to introduce a new product was made in-order to
compete with global brands like Nike, Adidas, Reebok, Puma, etc. in the Indian market. These
global brands were the suppliers of specialized sports shoes and thus Bata is trying to capture its
position in the market for specialized sports shoes. The company identified some issues and
customer needs with respect to their product. Their product was lagging behind in the latest
design (style) and the customer’s comfort when wearing the shoe. The company has invested in
huge amount in changing its store appearance and has also taken steps to incorporate the new
technology involved in manufacturing specialized shoes. The company forecasted the sales of
specialized sports shoes for the upcoming years and will have an increase of 14 percent in its
revenue, after the launch of the new product. The new specialized sports shoes target the people
involved in sports and all segments of customers from children to adults. Thus the marketing,
financial aim, and objectives are discussed.
Analysis and Findings:
Target Market: lower to middle-income group as well as the upper segment.

Basis of Segmentation: There are two different criteria used in order to segment the market. Thus
Bata Shoe Organization divides the market “geographically” as well as on the basis of “product
type”.

Retail marketing manager: As retail is the highest contributor to the companies business. A retail
marketing manager is responsible for planning, advertising as well as the whole of the retail
operation around the country. He also deals with the governmental regulation in respect of price,
stability, license, fees, etc. for launching new products. It is his responsibility to take initiative to
pass all the necessary documents from the regulation board of government. For this reason this
post-ranked third in the hierarchy of the companies’ organ gram in Bangladesh.

Wholesale marketing manager: The functional objective of the wholesale marketing manager is
to monitor and planning of wholesale market operation of Bata Bangladesh, which also is a very
important sales channel of the company.

Merchandising manager: In charge of the heart of the company the Merchandising department.
Who reports to the CFO and managing director directly and to some instance to the sales
channels especially to Retail. All the categories of shoes are headed by the Merchandising
officer/Category Merchandiser/Buyer who is in charge of every detail of his/her category. He/she
is responsible for his category business, choosing the right merchandise according to the market
need, distribute it properly and getting the feedback of the performance of his/her merchandise in
the market and plan accordingly. He/she, on the other hand, repot to the Merchandising manager

Production Department: Production division is aimed to increase productivity and quality as

much as required without spending more. There are two plant managers on in Tongi and other in
Dhamrai. They are controlled by the director of the production. They are responsible for
directing, coordinating and controlling the overall production activities means from the
purchasing raw materials to transferring those into complete shoes. The function of the
production manager is to assist the director of the production in achieving the production target
for a specified period. The function of planning and supply manager is material planning,
production planning, etc.

Finance Department:

 To maximize the interest of the shareholders of Bata Shoe Co. (BD) Ltd.
 To allocate the fund in a proper way that minimizes its cost and maximizes its profit.
 To ensure the conductive financial climate of the company.
 Company Secretariat
  To ensure the best selection, placement, and utilization of the administrative staff within
the company.
 To ensure discipline, mutual coordination, smooth communication among the
administrative stuff and thereby peaceful corporate environment.
 To ensure proper management of the financial matters of selection grade administrative
stuff.

Accounts Department:

 To ensure conducive financial trend of the company.

 To ensure a sound financial plan in terms of raising and allocation of funds and thereby
maximizing shareholders interest.
 To prepare the Annual Financial Plan of the company in terms of both procurement and
allocation of the fund.

Internal Audit Department:

 Pre-audit: To carry out all operational checks.

MIS Department:

 To coordinate and supervise data entry for the accounting and payroll package.
 To update product cost and product profitability from time to time.
 To arrange repair and maintenance of the computer hardware.
 To provide necessary support and help to the computer in their day to day function
 To prepare the monthly statement of “Advanced Sale Invoice”.

Costing Department: Headed by Costing and efficiency manager. The department is responsible
for all kinds of costing related issue of the shoe and makes the highest use of the manpower. The
department also is responsible for the highest use of material consumption and does the costing
of the shoes effectively and efficiently.

Current Strategy:
In spite of harder competition in the footwear industry, the objective of the management is to
maximize the market share and continued to be the leader in product innovation, new style, and
design and customer service. To realize these objectives the company is currently pursuing the
following strategies:

 The retail channels underwent both phases of consolidation and expansion. 48 smaller stores
which did not generate the required returns were closed. At the same time, three big format
profitable stores were opened or expanded. Sixteen strategic stores were renovated and upgraded
to reflect the improved image of the company.
 In our manufacturing operations we undertook some further restructuring in line with company
objectives. As a result, our both factories at Tongi and dharma remained fully loaded throughout
the period to meet the market demand. These factories produced around 26.6 million pairs.

 To compete with the low-priced shoes especially in plastic and thong categories new
merchandise in this category have been introduced at a competitive price.

 An aggressive media campaigns and in-store promotions were also conducted at various
occasions to support our leadership position, stimulate sales during peak selling periods and
provide support for our branded programs. Bata Bangladesh introduced many exclusive new
lines of shoes the majority of which comes during festival periods. These new arrivals were
introduced in different Bata brands.

 MIS team of our company took an initiative and deployed in house 24x7 connectivity system
whereby all the key information is available to the management both from marketing as well as
manufacturing operations for timely decisions. This project is also recognized at the global level
and nominated as winner award for 2015.

 The company launched “e-commerce” online buying facility to meet the future marketing
demand. The company hopes to benefit more from this marketing channel.

 To recognize and capitalize on the brand loyalty of customers Bata club “loyalty program” is
also in place. The membership of this club has risen up to 200,000. This program is providing an
excellent opportunity for our valued customer’s to earn more points to avail the maximum
discount and exciting prizes for future shopping.

 Emphasis has always been given to personnel development since this is an essential
requirement for the company’s progress. A total of 300 number of our employees participated in
various training courses in 2017.

Capabilities:

Industry Analysis
Footwear industry in Bangladesh:

The Footwear Industry in Bangladesh started its journey in the colonial era, although its
modernization took place only in the late 1980s. During the British period, there was no footwear
manufacturing firm producing on a mass scale in East Bengal. However, a traditional cottage
type footwear industry with limited production facilities existed in a skeleton form during that
time. Various types of footwear were imported, mainly from Calcutta. After the partition of
Bengal in 1947, footwears were imported from West Pakistan. When Bata Shoe Company
established its manufacturing plant at Tongi in 1962, it was the first manufacturing plant to
produce shoes on a large scale in East Pakistan.

At present, the industry is at the growth stage of its life cycle. The industry is mainly composed
by Bata, Apex footwear some local brand and imported footwear from abroad; mainly China. A
conceptual framework for industry analysis has been provided by Michael A. Porter. He
developed a five-factor model for industry analysis. The model identifies five key structural
features that determine the strength of the competitive forces within an industry and hence
industry profitability. The following section presents an analysis of the footwear industry in light
of the Porter’s Five Forces Model.

Degree of Rivalry in the Industry:

Though Bata has enjoyed quite a good market share and know the market for long the market
competition is intensifying day by day. In the decade the only worry for Bata was independent
sellers who have the minimal establishment costs and in many cases sale shoes of high quality of
minimal cost or poor quality shoes. But the situation has been changed much since now not only
the independent sellers but also the regional and world famous brands are now in Bangladesh. So
the competition has now much more intense. Bata Bangladesh has to think both of their old
threats as well as new competitors who have a much more organized structure than the old
competitors.

The threat of New Entrants:

Threat of new entrants is high in Bangladesh because Apex is already entered into the market as
a domestic shoe industry with high expectation and good management. Apart from that foreign
competitor like Liberty of India which already taking a grip into the shoe market especially the
women segment. There is also some other foreign shoe manufacturer like Nike, Reebok, Adidas,
and Woodland. There are also some other domestic companies like Baby, Pegasus, and
Homeland, etc. So the road ahead for Bata is not smooth at all and to forget the independent
sellers and smuggled shoe sellers who already have the highest market share. Bata has to go for
variety as well as their durability which they known for long. The threat of substitutes: One can’t
think of many substitutes for shoes. There are not too many barefooted people nowadays. At
least they wear a sandal. So the threat of substitute is not that much.

Bargaining power of Suppliers:

The bargaining power of suppliers is relatively moderate. The number of suppliers is huge. And
the upcoming and other shoe companies buy in so much quantity that the suppliers have to
satisfy them even if by increasing quality and by decreasing price. The threat of forwarding
integration by the suppliers is high as brand identity is not a critical issue in the shoe industry in
many cases.
Bargaining power of Buyers:

Bargaining power of buyers is increasing day by day as new shoe companies with an optimistic
future plan and changing trend and quality consciousness in increasing day by day. People want
durable shoes as well as modern designs. So to satisfy the customers the companies have to keep
up with the trend as well. The entrance of foreign brands like Nike, Reebok doesn’t make the
scenario easier. So one has to say that the competition is just heating up in the shoe industry. No
one can take easy even the established brand like Bata who have more than 35 years of
experience in the Bangladeshi market. So they must aware of the situation and work and take
steps accordingly.

Industry Life Cycle Analysis:

Products tend to go through different stages, each stage being affected by different competitive
conditions. These stages require different marketing strategies at different times if sales and
profits are to be efficiently realized. The length of a product life cycle is in no way a fixed period
of time. It can last from weeks to years, depending on the type of product. In case of the shoe
industry in Bangladesh, it is presently going through the growth stages which are characterized
by many new consumers entry in the market, by fall in price as experience and economies of
scale have been attained, by developed distribution channel and by increasing intensity of
competition.

Company Analysis:

SWOT Analysis of BATA:

Strengths:

 High-quality products

 Strong brand image

 Extensive product lines

 Strong and mass distribution network

 Wide range of associated bands

 Skilled management team

 Modern manufacturing facilities

 Potential target market

 Loyal customers

Weaknesses:

 High Price

 More emphasize on quality rather than design

 Lack of promotional activities

 Less effort to attract new customers

 High-cost structure

 High import duties

 High administrative cost

 VAT & tax barrier

Opportunities

 Wide assortment of products offered

 Better customer service
 Rise in export
 More emphasize on product quality and design
 Strong retail store network.
 Neat.& clean retail outlets
 Trained salesmen

Threats

 “Apex” is considered the biggest threats

 Potential new brands like Bay Emporium
 Counterfeiting of Bata Shoes in uncontrolled locations
 Consumer perception regarding the high price
 The high price due to the high production cost
 Disruption of consistent supply
 Switching new generation to trendy products.