A retail store study on Bata -by padmapriya IIPMB

Indian Institute of Plantation Management,

Bangalore

ASSGINMENT 1

RETAIL AND DISTRIBUTION MANAGEMENT

A retail study on Bata India

SUBMITTED BY

PADMAPRIYA V.

14PGDM27

Padmapriya ,V 14PGDM27

Background

Indian footwear industry holds a crucial place in the Indian economy for its potential for

employment, especially for weaker sections, and for supporting economy through its foreign

exchange earnings. India is the second largest global producer of footwear after China,

accounting for 9% of the global annual production of 22 billion pair as compared to China’s

share of more than 60%. India annually produces ~2.1 billion pair of which, ~90% are

consumed internally while remaining are exported primarily to European nations. Due to

this, India’s share in the global export market of ~US $ 120 billion is a paltry 1.9% in value

terms making it much lower than China’s share of ~40%.

According to The Associated Chambers of Commerce and Industry of India

(ASSOCHAM), an industry body,the foot wear segment is Growing at a compound

annual growth rate (CAGR) of about 15 percent, the Indian footwear industry is likely to

reach approximately Rs 38,700 crore by 2015 from the current level of around Rs 22,000

crore, according to a study titled ‘Indian Footwear Industry: An Analysis’ released by. On the

contrary, the global footwear market which is growing at a CAGR of about 5 percent is

currently estimated at approximately Rs 10.15 lakh crore and is likely to reach Rs 12.34 lakh

crore by 2015.

The domestic footwear market is driven by growing fashion consciousness together with

increased disposable income among India’s urban middle class which contributes about 45

percent of overall footwear market making India the second largest global producer of footwear

across varied segments after China. Low production cost, abundant availability of raw material,

ever-evolving retail ecosystem, buying patterns and a huge consumption market are certain basic

features that set apart the Indian footwear market.

India produces nearly 300 crore pairs of footwear annually, exports over 10 percent and accounts

for about 15 percent of annual global footwear production which is over 2,000 crore. Driven by

larger penetration into tier II and III cities and growing rural market, various premium footwear

brands are entering India’s non-metro market which holds enormous growth potential and

accounts for about 55 percent of the overall footwear industry. According to the study, Indian


footwear market is dominated by men’s segment which accounts for about 55 percent followed

by ladies’ and kids’ segement which account for around 30 and 15 percent, respectively.

Nearly 70 percent of the labour-intensive footwear industry in India is in the unorganised sector

and employs about 15 lakh people, majority of whom are rural artisans, cottage and household

units, while the organised sector accounts for remaining 30 percent and employs over 5 lakh

people.

Most of the footwear brands have exclusive outlets and account for about 55 percent of the

footwear market while multi-brand retail outlets account for about 30 percent.

In the non-leather footwear segment, there is huge demand for slippers as they are cheap,

convenient and suit the needs of the rural consumer as it can be used as a multi-purpose

footwear. Rural India accounts for about 60 percent of slippers manufactured in Indian footwear

market.

Online shoe shopping is a fast emerging segment in terms of footwear sale and currently

accounts for about 8 percent of the overall industry and is expected to reach nearly 20 percent by

2015.

Introduction

“BATA IS THE MARKET LEADER WITH OVER 16% SHARE IN THE ORGANISED

FOOTWEAR SEGMENT”

Bata India is the largest retailer and leading manufacturer of footwear in India and is a part of the

Bata Shoe Organization.

Incorporated as Bata Shoe Company Private Limited in 1931, the company was set up initially as

a small operation in Konnagar (near Calcutta) in 1932. In January 1934, the foundation stone for

the first building of Bata’s operation - now called the Bata. In the years that followed, the overall

site was doubled in area. This township is popularly known as Batanagar. It was also the first

manufacturing facility in the Indian shoe industry to receive the ISO: 9001 certification.

The Company went public in 1973 when it changed its name to Bata India Limited. Today, Bata

India has established itself as India’s largest footwear retailer. Its retail network of over 1200


stores gives it a reach / coverage that no other footwear company can match. The stores are

present in good locations and can be found in all the metros, mini-metros and towns

Bata’s smart looking new stores supported by a range of better quality products are aimed at

offering a superior shopping experience to its customers.

The Company also operates a large non retail distribution network through its urban wholesale

division and caters to millions of customers through over 30,000 dealers.

Bata India Limited is engaged in the manufacturing and retailing of footwear and accessories for

women, men and kids. The Company offers various categories for women and men, which

include chappals, closed shoes, sandals, formal shoes and sport shoes. The Company’s women

accessories include scarves and handbags. Its men accessories include bags, belts, wallets, shoe

care, foot care, handkerchief and socks. The Company’s brands include Ambassador, Angry

Birds, Bata, Bata Lite, Bata Walks Green, Comfit, Hush Puppies, Marie Claire, Naturalizer,

North Star, Power, Sandak, Scholl, Sparx, Sundrops and Sunshine, among others. It also operates

a non-retail distribution network through its urban wholesale division. The Way Finders Brands

Limited (WFBL) is a wholly owned subsidiary of the Company.

Values

Constant innovation in design and product development

Superior customer service.

Excellence in operational and commercial execution.

Entrepreneurial spirit and passion to win.

Teamwork in international environment.

Trust and respect for our employees.

Adding value to the community

Delivering on our commitment to shareholders.


Recently, Bata wants to reposition its brand. It has come up with a stand alone stores .It wants

to focus on front end cutting costs at back end. The front end strategy is focused on higher

footfalls, higher value retailing, driven by a new-look store layout and a resurgent brand and

back-end strategy of process rationalization in form of raw material cost and manpower cost

reduction.

BATA INDIA LIMITED TODAY !

Sells over 50million pairs of footwear every year

Serves over 150000 customers everyday

Sells through 1400 retail stores

Operates 5 manufacturing facilities

Employess more than 8000 people.

Premiumization to drive sales per store Company intends to increase sales per store by

improving value mix with a focus on the high margin leather segment that includes

accessories such as ladies bags, caps, belts among others. With parent Bata Shoe

Organization (BSO) enjoying 20% market share worldwide in the industrial shoes

segment, Bata plans to leverage the expertise and technology in India for industrial and

defence shoes. The defence sector requires 12m footwear every year, which is

supplied by unorganized players, thus providing greater scope for an organized player

like Bata. Company recently got a large order from the Indian Air Force.

The present assignment is basically to study about the footwear retail store. Since ,footwear in

India is still dominated largely by unorganized sector, untapped market ,Bata being a organized

one, frequently it is customizing as per Indian customers and it is rebooting its business

strategies. With this above background ,it motivated me to do a retail study in Bata India’s

individual stores ,to understand their strategies that is existing at the store level and this also

reveals the importance of choosing a strategic location in ease of doing the business.

*************


RETAIL STUDY

The retail study was conducted at Bata store at Basveshwaranagar ,Havnoor circle ,Bangalore

.The main observations was done only for seven days .The convenient timings was chosen for

the study .

Morning –Between 10.00 am- 12.00 noon

Afternoon -3.00 pm-4.00 pm

Evening – 6.30.pm -8.30.pm.

For the further queries ,store manager help was taken to understand the store layout, proximity of

customers in the store ,space planning ; merchandise and marketing mix strategies ,up-selling

and cross selling ,etc.

Take away from the study

To understand number of footfalls to the store with respect to timing of the visit

To understand the conversion rate with respect to foot falls and average billing done by the

customers.

To observe the store space and understand about marketing mix strategies.

About the store

The store was started during 2005 in Basweshwarnagar. Earlier the store was located at

“Navarang” and later it took frequent changes in the lacation and now took a firm stand as a

stand alone building in Havnoor circle .It is a commercial cum residential place.

Store manager –Mr.Srinivas

Contact No.805099086

Location and site selection

Location selection is the first and foremost important element for any retail store. It was

observed that the chosen location is in the heart of the area. The left hand of the area is fully a


commercial area while right side is a residential area.The Economic conditions-elite class and

middle high class people reside in then area.Thus these are the targeted customers.

Opposite to the store a well known fast food restaurant–Pvitra paradise is situated. Very

Closely,Mc.Donalds is situated. People from three areas come to these restaurants. Bata

possibly cater these customers too. Analyzing all these factors and area, Bata structure the

strategic fit with the target market considering the demographics, lifestyle of the customers

and some other factors.

Competitiors –COMPETITIVE ANALYSIS

Down the lane of the store , Adidas, Puma, Metro, Khadims are the main competitors.These

stores are catering to high end customers.

STORE STRUCTURE

Usually 5 concept of business is being followed by Bata .

City or Town location ,Shopping Centre Concept ,Bazaar Concept ,Family concept ,Clearance

outlet.

NIKE

,REEBOK,ADIDAS,

PUMA,WOODLAND

S

ACTION ,LIBERTY ,NIKE ,ADIDAS

,REEBOK

BATA ,ADIDAS ,LIBERTY,NIKE,KHADIMS

BATA,LUNARS,VKC PRIDE,KHADIMS Lower Income

Group

Lower middle

class

Elite class

Upper middle

class


Out of these ,the store is of family concept type – It is basically a three storied building .So it

contain shoes for all members of the family. It display all the items in the first place but these

stores are mostly limited items according to the area and business model targeting the specified

stores customers.

MERCHANDISE

Merchandising method –Stocks –store ;Number of brands -20

Range of products

Gents ,Ladies ,Children(Formal shoes )

Ladies,Gents ,Kids footwear

Socks

Polishes

Brushes

Lace

shiner

Bags (School,hand bag,totes)

Hankeys

Clutches

Foot care

Valets

Scarfs

Belts Brea

dth

o

f ass

ort

men

t (V

ari

ety )

Width of assortment

Shoes

Formal

Informal,

sports

Varieties

Men

Women

Kids

Polish Varieties

Wax

Spray

liquid

Kerchief

Sold as brand

ambassador

Socks

Sports,health care

(Men,Women)

Fomal,ankle

socks


List of brands under BATA

NUMBER OF FOOT FALL

Footfalls are the number of customers visiting the store .

Day morning late

afternoon

evening Total

Monday 3 5 20 28

Tuesday 8 12 15 35

Wednesday 5 8 17 30

Thursday 10 10 12 32

Friday 10 10 20 40

Saturday 10 20 40 70

Sunday 45 15 30 90

Total 91 80 154 325

BATA SAFARI

BATA AMBASSADOR POWER

BATATECHNOLOGY

(FLEXIBLES,ANTISTATIC )

SUNDROPS

BABYBUBBLES TOUGHEES

COMFIT WEINBRENNER

INDUSTRIALS TOMMY TAKKIES

BUBBLE GUMMIES BATA ACCESSORIES

MARIE CLARIE BATA SHOE CARE

NORTH STAR SCHOLL -PREMIUM

PATA PATA HUSH PUPPIES


Interpretation

From the above ,it can be observed that ,evening time (6.30-8.30 pm )footfalls are more and

again in the week end Sunday ,especially morning time it is more .Evening time is the best time

preferred for shopping ,because it is the time all age groups of people come out of their house

and spend their time .

3 8

5 10 10 10

45

5

12 8 10 10

20 15

20 15 17

12

20

40

30

0

10

20

30

40

50

Monday Tuesday Wednesday Thursday Friday Saturday Sunday

No

.of

fo

otf

alls

days

Footfalls based on timings

morning late afternoon evening

28 35

30 32

40

70

90

0

10

20

30

40

50

60

70

80

90

100

Monday Tuesday Wednesday Thursday Friday Saturday Sunday

Total footfalls

Total


From the above graph it can be observed that in weekends ,footfalls are very high. Because

,weekends will be off ,and people like to relaxation in terms of shopping experience.

CONVERSION RATE :

Percentage of footfalls buying goods and services

According to the store manager ,75% of the customers are assured customers .But this only

applicable to category of merchandise .For examples ladies bags, leather valets –these prices are

high. For footwear category, customers are determined what to buy and they come and pick their

favourite brands of footwear.

Fig 3: Conversion rate of footfalls

AVERAGE BILL AMOUNT.

The total amount in a week is 2,33,500Rs. Avg bill amount is Rs.615/head. Per day avg billing is

28585 Rs.It is inclusive of discounts (33% or 50%) on certain categories . However ,there are

some premium brands like scholl,comfit charge premium prices , for this discounts are not there.

Therefore approximate billing amount is noted down. The below table gives the billing value

21 26.25

22.5 24 30

52.5

67.5

0

10

20

30

40

50

60

70

80

No

.of

foo

t fa

lls

Days

conversion rate

con rate


Table :billing details of the BATA store

Day Bill val Footfalls

Monday 19600 28

Tuesday 24500 35

Wednesday 21000 30

Thursday 16000 32

Friday 24000 40

Saturday 45000 70

Sunday 50000 90

Total (1

week)

200100 325

Avg 615.69/Head

Avg/day 28585

STORE LAYOUT

“Store layout needs to guide the customer silently about where he/she wants to go and for

exposing him/ her to the entire store offering”.The store itself it’s the most meaningful

communication between the retailer and the customer.

The BATA store is free flow or boutique type of store layout .

The simplest type of store layout is a free flow layout, in which fixtures and merchandise are

grouped into free flowing pattern on the sales floor. Here , Socks and shoes; leather purse /Vallet

and Bata key chains ;polish and varnish are grouped.

Customers are encouraged to flow freely through all the fixtures, because there are usually no

defined traffic pattern in store. This type of layout of works well in small stores, usually smaller

than 5000 square feet,(here 4800sqft) in which customers wish to browse through all the

merchandise. It there is a greater variety of merchandise (for instance, men’s and women’s

apparel, bedding, and health and beauty aids), a free-flow layout fails to provide cues as to where

one department stops and another start confusing the shoppers.

Advantage-: increased impulse buying · Disadvantage-: possible confusion and waste of floor

space


Store Design

Means how best the interiors and exteriors are synchronizing with the merchandise .

In Bata store :

Interiors

Interiors Features Exteriors Features

Method of display At PoP

POS

Special fittings

Walls

Location Havnoor Circle

Visual merchandising Only few products Marquee (A name

plate to identify the

Visibility is there at the

entrance

Entry /Exit

Merchandise

Fixtures

Easy movement


brand )

Signage For differentiating

sub brands ,it is used

Store entrance In the middle

Window display Vast

Door types Glass doors

Walk ways Multiple ,stairs

Size of the building 4200 sqft.

Colors and materials Bright colors

Visual merchandising is the activity and profession of developing the floor plans and three-

dimensional displays in order to maximize sales. Both goods or services can be displayed to

highlight their features and benefits.

Signage, refers to the design or use of signs and symbols to communicate a message to a specific

group, usually for the purpose of marketing or a kind of advocacy.

PRICING

Pricing strategy used by BATA is odd pricing .The price adjustments or fixation depends upon

the demand .However,the store doesnot have any power to do so, based upon the Prices set at top

level in Bata org. the store will follow. Below table describes the range of prices

Table :Range of pricing at store

Types Age Price (Rs)

For infants Infants 299-1000

Children 4-9 yrs 299 onwards

10-14 yrs Ends at 1399

Leather shoes Above 15 yrs 899-5500

Sport shoes Above 15 years 1100-2500

ladies Above 15 years 299-1999

Cut shoes normal Above 15 years 299-499

Cut shoes leather Above 15 years 1499

Discounts are also prevailing at recurring number like 33% and also 50 % .It was also observed

that , only the non sold items are kept for sale or at discount. If we consider other catagories,

like complementary items , prices are high.

PLACE :

Distribution network is good. Once the stock is over ,the 12000 pair of footwears are sent to

the stores through the stockiest .This is the maximum limit that store can have .


Time –working hours morning 10 am to night 10 pm .

Parking facility is available .

Other facilities are credit card ,gift card etc .

CRM activities : MOBILE –MESSAGES ,REDEEM POINTS ,BATA card is being given to

customers .

If stock is not available , stock is ordered and delivered at customer house.

PROMOTION

Promotion is done through magazines, online sales/deals in different E-Commerce companies.

Banners ,pamphlets ,promo codes .

Using soft sell messages –aims at developing brand liking ,preferences in terms of

features,pricing ,benefits or brand itself .It is to create the positive brand image in minds of

people .


A glance of the store

Men section

Polish,brushes

Signage

Marquee

Promotion

Entrance Main road

Stand alone store


ags

Other section of the store-ground

floor

Billing counter

1st floor

Accessories

Bright colors

Premium foot wear Bags

3rd floor –for stocks


Proximity

Kids zone

Foot wear at

discounts

Sitting

facility Mirror

CSR @

BILLING

COUNTER

A retail store study on Bata -by padmapriya IIPMB

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Transcript of A retail store study on Bata -by padmapriya IIPMB