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Bata Industry Analysis

Categories: Industry

Introduction

Since 1942 Bata Pakistan has been offering its services to its valued customers by offer quality products. It was incorporated in Pakistan as Bata Shoe Company (Pakistan) Limited in 1951 and went public to become Bata Pakistan Limited in the year 1979. Since its inception, the company has not only maintained a good reputation of manufacturing high quality footwear for all segments. Bata Pakistan is serving its valued customers through a strong retail network comprising of more than 400 retail outlets, 467 registered wholesale dealers, 13 wholesale depots, 28 wholesale distributors and 41 disposable wholesale franchises across the country.

Bata has always been the market leader and in order to maintain its leadership it has invested millions of rupees in updating its systems and equipment during the last few years. This will enable the company to expand, modernize and develop its operations and in the process provide additional employment opportunities. Bata the market leader is well equipped to cater the customer’s demands and to meet future challenges.

Literature review

In this report we have discussed the financial statements and reports of the multinational company of BATA. As in the introduction we have seen the brief history and its position in the market. Further we have analyzed the SWOT ANALYSIS of the organization of the Bata briefly in which strengths; weaknesses; opportunities and threats of the organization have been briefly analyzed. To strengthen the influence of this report we have also analyzed the PEST ANALYSIS of the company through which we measured the performance and market value of the company in immense way.

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Ratio analysis of the company BATA have also been done to see the financial position of the company whether it is in pace or not to measure this in the report and make easy to understand the report for the readers we have also mentioned the types of the ratios and how we have measured them.

Latest reports of the company available till the year 2008 2009 we have mentioned in the report the financial statement of the company in the report. In this all procedure we analyzed whether Bata is going in profitability or not and its capital as well invested in the business. Every type of ratio analysis has been done to know in and out of the company. In the last we have mentioned the financial statements as per year 2008 and 2009 which was last available. More over BATA is busy in targeting its competitors and working hard to maintain their position in the market and targeting customers through new product lines and entering into the new market segments to keep pace in the environment.

PEST- ANALYSIS

A PEST analysis looks at the external business environment. PEST stands for Political, Economic, Socio cultural and Technological. The analysis examines the impact of each of these factors (and their interplay with each other) on the business. The results can then be used to take advantage of opportunities and to make contingency plans for threats.

POLITICAL:

When examining political factors, you need to look at any political changes that could effect your business. What laws are being drafted? What global changes are occurring? Legislation on maternity rights, data protection, health & safety, environmental policy, should be considered. Bata has politically good relation with other countries as it have the branches over some countries and have provided full consumer protection to every customer. Tariff duty on imported shoes dropped by 65% to 25% during 2000-2003 which were expected to decrease more by 2005. Due to corruption in customs, import duties effectively reduced to 8% rather 25%.

ECONOMICAL:

Often the political factors spill over into economic factors, For example, tax is usually decided by politicians, based on a mixture of political and economic factors. Interest rates, in many countries are decided by a central bank, but political factors may still be important. Other economic factors include exchange rates, inflation levels, income growth, debt & saving levels (which impact available money) and consumer & business confidence. BATA having it’s headquartering in Canada, the largest foot wears manufacturing. This covered network of 75 shoes factories in 95 countries. Pakistan BATA belongs to BIG East (Bata International Group) which covered some of the east countries while BIG West includes some of the west countries.

It started shoes export in 1955 and by the nineties it was exporting too many countries mainly in Europe and Middle East. In 2000 Bata exported 730,000 pairs of Rs sixty million. As there is deviation in product design all the time, the production cost start increasing and productivity went down and coming up with defects. In 1997 govt. introduced 15% sale tax which lowered the profit which at the end has to come out of the lower end market. The company changes its MD managing director in which every new MD brings in his own ideas and management. It gives all the facility to his employees which they required. SOCIAL:

Finally, all this influences and is influenced by social factors – the elements that build society. Social factors influence people’s choices and include the beliefs, values and attitudes of society. So understanding changes in this area can be crucial. Such changes can impact purchasing behavior. Bata provides shoes to all age groups, all level of the classes from lower to upper and to the entire family but it lacks in the design of daily fashion, because of which people are shifting to other brands. There advertising is also not that much attractive which can make customer towards it.

TECHNOLOGICAL:

Advances in technology can have a major impact on business success – with companies that fail to keep up often going out of business. Technological change impacts socio cultural attitudes. For example the way people spend their leisure has changed dramatically over the last 30 or so years. As well as advances in your own industry, think about the likely impact of new technologies – the Internet, nanotechnology, mobile phones, and the increasing advances in computing and computers. Bata is technologically lacking as in E- commerce and online store. Bata is providing product up to the market with different varieties. Being a multinational company Bata Pakistan has played a vital role in the economic progress of Pakistan. It has introduced sophisticated technology and business skills to the country and provided direct and indirect employment to about 10,000 people. Along with its own manufacturing capacity Bata Pakistan is also outsourcing its products nationally and internationally to meet the demands of its valued customers.

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Bata Industry Analysis. (2016, Dec 08). Retrieved from http://studymoose.com/bata-industry-analysis-essay

Bata Industry Analysis
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