Bata opts for franchise model for smaller cities

Now Bata plans to enter Tier III and Tier IV cities through the franchise model. Considering that retail business is expected to grow rapidly in Tier III and Tier IV markets over the next five years, due to increasing disposable incomes, and the fact that these markets are largely unrepresented by organised players, the company decided to enter new markets through franchising instead of opening own stores. The franchisee business would also ensure partners grow consistently with the brand and get a decent return on their investments.

It plans to open stores focusing on Bata, Hush Puppies, Footin. It has currently identified 100 potential trade areas that cover both malls and high street areas. About 40 percent of its sales comes from metros and the rest from other cities and towns. Bata currently has 64 franchise stores and about 1,300 retail stores. It has five manufacturing units and 7,770 employees. It sells 50 million footwear pairs a year.

In 2015-16, Bata recast its plans of opening 100 stores every year and decided to concentrate instead on achieving same-store growth. It has been following a dual strategy of driving same store growth and opening new stores. The company also has a significant online presence. It is now speaking the language of the young and its social media presence and blogs go beyond shoes and offer suggestions on the entire wardrobe which consumers can benefit from.