From the reliable shoes and slippers to today’s fashionable and “surprisingly Bata”. The Bata growth journey has been somewhat legendary.
Footwear maker Bata, which has a retail network in 450 towns with 1500 stores, is continuing its growth journey in India with the multi-retail channel approach along with an e-commerce platform. Inspite of the Net loss of Rs. 101 crores in this quarter, the company, has announced further to expand its reach by adding 100 new stores through franchise route, in this financial year and 500 outlets by 2023 in semi-urban and rural markets.When other companies are taking a back seat, Bata is roaring and capturing a huge market segment. They have introduced a new marketing initiative as ‘Bata on Wheels’, for 86 locations in India.
Now, Bata India is one of the most prominent competitors in India but it all began when Bata started small operation in Konnagar (near Kolkata) in 1932 & by 1973, the company went public. Over time it has evolved to stay in tune with the times, consumers, and the markets in more than 70 countries which leads to an exuberant Bata. But in such a large tenure they never changed their focus i.e. - innovation, marketing and customer service.
Bata rarely needed large scale campaigns to make its presence felt. Its low- cost, rubber slipper brand, Hawai, launched in 1950, turn out to be a generic name. During the 70s-80s, the branding emphasized durability, affordability and comfort which was mostly limited to word-of-mouth and merchandising through the point of sale. This was the time the brand was attempting to set foot in lives.
In the mid-80s, because of partial liberalization, Bata faced some difficulties but by adding capacity and sub-brands like- North Star, Marie Claire and Power, they solved it. In 1988, Bata established its fifth factory in Bangalore. However, its image as a giant was taking root. Bata took a big leap in the 90s & revived its flagging sub-brands, & launched its first premium brand, Hush Puppies, and floated a corporate campaign. The company, with its sturdy, value-for-money shoes had come out to be on everyone's tongue for its dated designs. It was the right time to display something more aspirational by way of premium and well-designed shoes.
However, till 2004, profits continued to slide, and Bata India went into the red. But from 2004 onwards, new management, came down hard on the labour irregularities. After reporting losses till 2004, Bata made a net profit of Rs 12.49 crore in the year ended December 31, 2005. Bata finally outsourced production in line with its specifications and hence doubled its revenue from 12923.42 million in 2010 to 31222.92 million in 2020.
Bata is quite active & robust in taking decisions. They always focus on individual traders rather than HNI & Institutional investors & for this they split their shares several times starting from 2008. But earlier, it was trading on discount because of the negligence of the investors. Its stock price was almost stable from Rs. 101 on 1 February 1999 to Rs. 91 on 4 January 2010. But from 2008, it started to go through a change (because of the split of shares) & suddenly it gained popularity among the investors which ultimately increased its stock value to reach Rs.1351 on 27 August 2020.
But recently because of Covid, it has also suffered a lot. Its stock price has also decreased from 1509 on 27 August 2019 to 1351 on 27 August 2020 & Net income dropped to a loss of 101 crore. But instead of this their management’s long-sightedness has always helped Bata India in achieving robust growth. They are using their Rs. 18323.15 million reserves to meet the target of opening 100 stores, even in this Covid era with zero layoffs.
This is not surprising?
On the whole, it’s clear that Bata India has not only surprises consumers but also investors with their invincible growth & market penetration. They are growing 24x7 in a slow & steady manner. But in between growth & development, they never forget their core business, which made them successful. There are some challenges in this Covid, but according to the past, it’s nothing for them. Bata can surely come out of it & most likely, there is a chance, that in the next 10 years Bata is competing with brands like Adidas or Nike. So, according to Winston Churchill "Success is not final, failure is not fatal: it is the courage to continue that counts." So, this is not a success for Bata, still it has a long way to go.
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