BATA PAKISTAN

LIMITED

Presented by:
Farheen Salahuddin Ansari
Nashata Tahir
Syeda Mariyam
Maryam Ahmed
 Main
Concern
Bata faced competition from the vendors selling its own
brands at lower prices.
Some of the shopkeepers were selling imitation of Bata
shoes to the customers.
Bata expected that its distributors would sell only to
those dealers who did not operate in the vicinity of its
stores or agencies but they could not exercise any
control over the dealers.
The case describes the company history and channel
management
 Background
Bata international was found in 1894 at
Zelin, Czechoslovakia by Mr Thomas
Bata.
Headquarter is in Canada.
By 1987 it had over 100 factories in 90
countries.
Was selling 300 million shoes per year
in 6000 retail stores.
Bata Pakistan was started in 1932 at
Batapur, Lahore as a branch of
Batanagar in Calcutta.
In 1985 Bata opened another Factory in
Lahore.
Shoe
Market
Shoes market in Pakistan had
some distinct characteristics.
They were sold on the basis of
literacy, income level and locality.
In cities people bought more than
a single pair of shoes whereas
villagers only bought one pair or
used to prefer being barefooted.
140 million pair of shoes were sold
per year.
Average price per pair Rs 30.
Sales break-up by types of shoes (1986):
Women used to buy 4 to 5 pairs a year.
Men bought 1 pair a year.
Average purchase of a child from middle income 3 pairs
a year.
Men 4,438
Ladies 5,115
Children 4,685
 COMPETITIO
N
Bata largest among a few shoe manufacturers having national
presence.
Market share:
Bata: 10%
Service Industries: 6-7%
Basco,
Rajex,
A-1 shoes,
Shahid Industries, 5-6%
Zinco
WASA
Service shoes:
Sold through: own stores & distributors.
Always have stores next to Bata stores.
Hired Bata employees at the time of incorporation.

Shoe cottage industry:

Cottage manufacturers sold to retailers in their regions.
Some regional stores:

English shoes

Gave strong competition to national brands.

 Evolution of shoe industry in
Pakistan: Competition intensified:

60s , 70s & early Mid 80s

80s Private brands imitated Bata & sold for half their retail price.
Poor stitching Retail margins:

Low quality leather Refined leather by A dealer selling Bata shoes:

tanneries
15% on sales price of Rs.
Processed by New technology:
antiquated Direct injection
325.
methods moulding & Private brand: 20-25% on
locally made
machines.
similar brands
Even Service imitated Batas style color & features.
Unable to compete
with firms like
*Bata Bata*
used chemically processed leather &
high quality stitching machines
 BATAS PERCEIVED
STRENGTHS
Excellent quality & service
Affordable prices
Leader of shoe design in Pakistan.
Provided designers with latest information on fashion, design
& trends
Employees sent to international fairs & exhibitions
An exhibition Shoecon held every year in Italy. Attended by
4 people from Bata Pakistan.
Strong brand image
BATAS MARKETING
ORGANIZATION

Responsible for planning production.

Merchandisi Distributed finished products to
Marketing department
ng Controlled inventory
Department Decides liquidation of redundant shoe
lines.

Factory
 RETAIL DEPARTMENT
Aspects To Be Covered:

ADVERTISING

STORES

AGENCIES
 DEPARTMENT MANAGED
40-45% Of Total Domestic
Sales COMPANY STORES
AGENCIES

230
90

COUNTRY

PROVINCES 510
520

530
DISTRICTS (511,512,..)
 Advertising
Who Controlled It?

What Was The Fixed Budget?

What Did Ads Emphasize On?

What Were The Departments Other

Responsibilities?
LETS WATCH SOME
ADVERTISEMENTS
 Stores
Stores Opened

Strong Demand
Land Available

(Purchased, rented, leased)

Salesman= RS.2000-6000/MONTH
Manager= RS.6000-8000/MONTH

Classifications
A B C D
 AGENCIES
When It Was Difficult To
Buy, Lease, Rent Stores

Prearranged
Motivated by
Responsibilities of BATA
Image Advertising Quality
and Agency

Process of Payment Agent Offered

Each had the right to Location Experience Fin. Sound
Terminate Contract
 WHOLESALE DEPARTMENT
Sales in 1986 = 8 million pair of shoes.
Earns 15-20% more revenue than retail dept.
Wholesale
department

17 Depots (Company
5 Distributors owned)

Registered
Dealers
Dealers
 WHOLESALE DEPARTMENT
DISTRIBUTORS:
In Lahore and Karachi two distributors each and Peshawar had one.
Discounts offered to them:
14% less then retail price
9% quantity discount
2% cash discount
Semi-annual bonus on achieving a certain target
Bata expected its distributor to sell to those dealer who did not
operate in the vicinity of its store and agencies.
Bata had right to terminate any distributorship on non-performance.
Depots 17
Depots

Controlle Controlle
r1 r2

1. Hyderabad 1. Rawalpindi
2. Nawabshah 2. Sargodha
3. Dera Ghazi Khan 3. Bannu
4. Sukkhar 4. Abbtabad
5. Faisalabad 5. Sialkot
6. Sahiwal 6. Bahawalpur
7. Gujranwala 7. Rahim Yar khan
8. Jhelum 8. Multan
9. Quetta
EXPORT DEPARTMENT
Oversees both the government and export area.
In 1986, the government withdraw the 12.5% export
compensatory rebate.
A drop of RS 10 million in sales in export department.
 Recommendations
Bata should sign contracts with the distributors stating
their required factors.
Bata should give additional trade discounts to the
distributors, which would encourage them to sell to the
retailers on Batas terms.
The Bata shoes should have some sort of logo that
would differentiate its product from the imitation, and
promote it through advertisements.
Bata can also terminate its agreement with
the distributors not cooperating.