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Bata operations
- 1. INTERNATIONAL BUSINESS CASE STUDY Presented By Sushmil Sahai-07 Kushal Arora-019
- 2. BATA COMPANY OVERVIEW Facts about Bata • Founded by Tomas Bata in 1894, riverside town of Zlin, Czechoslovakia • Trusted global company that offers fashionable and affordable footwear to every member of the family • 5,000 international retail locations in over 70 countries • Services over one million customers per day
- 3. BRANDS • North Star • Bata Industrials • Patapata • Bubblegummers • Power • Baby Bubbles • Sandak • Comfit • Sundrops • Eco Fit • Weinbrenner • Marie Claire
- 4. ANNUAL GROWTH Annual growth of 2014 The Company business witnessed its record level with net turnover of Rs. 6.429 billion signifying a growth of 26% The Gross profit was recorded at Rs. 2.672 billion with improvement of 23% 0 1 2 3 4 5 6 7 net turn over gross profit 3-D Column 2
- 5. BATA COMPANY POLICY Policy at Bata • Managed in a decentralized way, which means that the company is able to adapt to the local environment • Bata has a performing business strategy based on economies of scale • Trying of not exporting; the local production is basically dedicated to the internal market
- 6. BATA GLOBAL OPERATIONS • It retails in 50 countries, employing about 40,000 people. • It owns 5,000 stores, apart from distributing through several thousand franchisees worldwide. • Its 40 operating units in 26 countries REGIOCENTRIC APPROACH The operating companies are grouped into four regional business units that, according to BSO, are based on similarities in markets and business issues. The four business units include 1. Bata Asia Pacific-Africa, 2. Bata Europe, 3. Bata Latin America and 4. Bata North America
- 7. MODE OF ENTRY Wholly Owned Subsidiaries • Eighty-five percent of BSO's subsidiaries are wholly owned. • In a wholly owned subsidiary, the parent company owns all of the shares of the company and there are no minority shareholders. The subsidiary continues to operate with the permission of the parent company. The parent company may or may not have direct input into the subsidiary operations and management. Rest 15 percent depends on the market or economic policies which includes • Minority ownership • Franchising • Autonomous Subsidiary like India
- 8. Bata In INDIA • Bata India, the largest subsidiary in the Asia group, is 51 % owned by Bata Ltd. and had a record loss of $9.8 million in 1995. • BSO intervened by sending expatriate managers with turnaround experience and providing fresh investments and an interest-free loan of $10 million. Expatriate Manager-An expatriate (often shortened to expat) is a person temporarily or permanently residing in a country other than that of their citizenship. In common usage, the term is often used in the context of professionals or skilled workers sent abroad by their companies. • The new managing director, Stephen Davies, moved from Bangladesh with a charge to focus on marketing.
- 9. AWARDS Awards • “The world’s 25 Unsung Innovative Companies” listed by business week. • TOP 50 Most Trusted Brands- recognized by Brand Equity • Most Admired Footwear Brand by Images Fashion Forum. • Selected as a POWERBRAND in the POWERBRANDS 2010.
- 10. Thank you !!
Editor's Notes
- dayFrom its simple start over 118 years ago, Bata has grown into a trusted global company that offers fashionable and affordable footwear to every member of the family. As the 20th century came to a close, Bata had been building relationships with generations of families for over 100 years. Thomas G. Bata, the founder's grandson, remained committed to that tradition in the emerging global marketplace. In a bold move, he replaced large, centralized factories with regional production facilities guided by four "meaningful business units" (MBUs), each having the flexibility and independence to produce footwear that responds to the unique needs of its region. As a result, Bata is honored to be a local company in every country it serves. We will grow through the 21st century by investing our resources in innovative comfort technology, remaining on the cutting edge of style, and ensuring quality and affordability. Now as then, we believe our success is a result of our commitment to our customers, and we'll continue to look to the future by reading our past.
- om Bata travels a lot in order to control production's quality and to establish diplomatic relationships with the governments of the countries where the company has subsidiaries. Although Bata has factories in more than 90 countries and a lot of economic operations in more than 100 countries, the company does not own 100% of these businesses. The company owns 100% of the business only in countries where this is possible, but in certain countries the government does not allow to a foreign company to have the majority control. For example, in India 60% of the local shares of Bata are listed on the stock exchange, meanwhile in Japan Bata Ltd. owns only 9.9% of the operations. In some cases, Bata also provides licences, consulting and technical assistance to its business partners. ------------ Bata has a performing business strategy based on economies of scale. Some multinational companies try to diminish their costs by obtaining economies of scale in production, which means that these companies produce as much as possible by using standard production factors. Bata is able to obtain economies of scale very rapidly because of the large production in different countries. This could seem pretty hard to believe, especially if we consider that Bata has production facilities in certain African countries where the company's operations represent the only form of industrialization. In spite of this situation, Bata considers that economies of scale are very easy to obtain because it intensively uses the workforce production factor. Bata also tries to completely use the raw materials found locally, but in some cases this is not possible, especially in the underdeveloped countries. But the company still tries to maximize the value added in these countries. ------------- Another policy of Bata Ltd. is about trying of not exporting; the local production is basically dedicated to the internal market. Obviously, this rule is not generally available since the company produces in 90 countries but distributes its products in more than 100 countries. Sometimes, when importing raw materials but not exporting its products, Bata's policies are in conflict with the ones of local governments. The company has to adapt to the local legislation. Bata generally avoids basing its operations excessively on exports, mainly due to the risks it implies. For example, if an importer country decides to diminish its commercial activities, Bata could lose market opportunities and could also lose in terms of market share. More than that, Mr. Bata noticed the advantage of a developed country that is not applying a protectionist policy.