PROJECT REPORT ON “BATA INDIA LTD” Aim Of Project This report aims to enable an understanding of a wide range of business functions and contextual domains such as Behavior, finance, legal and marketing. By doing this report we able to apply both quantitative aspects of business, such as economics and accounting, and qualitative aspects such as OB, HRM and Industrial Law. TABLE OF CONTENTS S. No| Particulars| Page No. | 1. | Overview Of Indian Footwear Industry| 6| 1. 1| Production Capacity of shoe Industry| 8| 1. 2| Export & Import Overview| 10| 1. | Role of Government in shoe Industry Of India| 14| 1. 4| Raw Material Used For shoes| 15| 2. | Organization Profile Of Bata| 16| 2. 1| Share Holding Pattern| 17| 2. 2| Board of Director| 18| 2. 3| Management Organization Structure| 22| 2. 4 | History Of Company| 23| 2. 5| Company Values| 25| 2. 6| Company Commitments| 26| 2. 7| Bata Position Today| 27| 2. 8| Brands of Company| 28| 3. | Internal & External Environment| 34| 3. 1| H R Policy| 34| 3. 2| Employee Categorization| 39| 3. 3| Corporate social responsibility| 39| 3. 4| Manpower| 40| 3. 5| Marketing Environment| 41| . 5. 1| Macro Environment| 42| 3. 5. 2| Micro Environment| 49| 3. 5. 3| Internal Environment (The Company)| 56| 3. 6| Product Mix| 58| 3. 6. 1| Price & Product| 63| 3. 6. 2| Place| 74| 3. 6. 3| Promotion| 78| 3. 7| STP of Bata| 89| 3. 9| Expansion & Future Plan| 97| 4. | Financial Analysis| 98| 4. 1| Analysis of Bata Report| 98| 4. 2| Competitor Analysis| 109| 5. | Factor That Will Affect Organization Demand| 123| 6. | Factor That Will Affect Organization Supply| 128| 7. | Implication Of Fiscal Policy| 134| 8. | Implication Of Momentary Policy| 139| . | SWOT Analysis Of Bata| 143| 10. | Recommendation| 146| 11. | Conclusion| 147| 12. | Competitor Profile| 148| 12. 1| Lakhani| 148| 12. 2| Liberty| 151| 13. | Minimum Wages Chart| 154| 14. | Work Place Safety Checklist| 156| 15. | Social Compliances| 163| 16. | Recent News Related To Footwear Industry| 169| 17. | Annexure| 173| 17. 1| Product Profile Of Bata| 173| 17. 2| Balance Sheet Of Bata| 181| 17. 3| Profit & Loss Of Bata| 183| 17. 4| Quarterly Result Of Bata| 185| 17. 5| Mutual Fund Activities Of Bata| 187| 17. 6| F I Activities Of Bata| 188| 7. 7| Balance Sheet Of Lakhani | 189| 17. 8| Balance Sheet Of Liberty| 190| 18. | Reference| 191| 19. | Report Check List| 193| 1. Overview of Indian Footwear Industry The Footwear Industry is a significant segment of the Leather Industry in India. India ranks second among the footwear producing countries next to China. The industry is labour intensive and is concentrated in the small and cottage industry sectors. While leather shoes and uppers are concentrated in large scale units, the sandals and Chapels are produced in the household and cottage sector.

India produces more of gents’ footwear while the world’s major production is in ladies footwear. In the case of Chapels and sandals, use of non-leather material is prevalent in the domestic market. The major production centers India are Chennai, Ranipet, Ambur in Tamil Nadu, Mumbai in Maharashtra, Kanpur in U. P. , Jalandhar in Punjab, Agra and Delhi. The following table indicates concentration of units in various parts of the country Region|   Large & Medium Scale  | SSI| Household| Tamil Nadu| 64| 31| 7| Delhi & up North| 4| 8| 2|

Agra, Kanpur| 9| 34| 14| Calcutta| 1| 3| 19| Bangalore| 6| 3| 4| Mumbai| 3| 11|  | Others| 13| 10| 3| | The estimated annual footwear production capacity in 1999 is nearly 1736 million pairs (776 million pairs of leather footwear and 960 million pairs of non-leather footwear). Region-wise share of total estimated capacities is as follows Region| Leather  Shoes  | Non-leather Shoes| Leather Shoe Uppers| Leather Sandals| Non Leather Sandals| Percentage| Tamil Nadu| 26| 5| 54| 1| 0| Delhi & up North| 10| 77| 4| 1| 60|

Agra, Kanpur| 45| 0| 32| 62| 0| Calcutta| 12| 0| 2| 3| 0| Bangalore| 3| 3| 4| 0| 0| Mumbai| 4| 2| 1| 32| 0| Others| 0| 13| 3| 1| 40| Total| 100| 100| 100| 100| 100| | Shoes manufactured in India wear brand names like Florsheim, Gabor, Clarks, Salamander and St. Micheal’s. As part of its effort to play a lead role in the global trade, the Indian leather industry is focusing on key deliverables of innovative design, consistently superior quality and unfailing delivery schedules. India in itself has a huge domestic market, which is largely untapped.

The Indian footwear industry is provided with institutional infrastructure support through premier institutions like Central Leather Research Institute, Chennai, Footwear Design & Development Institute, Noida, National Institute of Fashion Technology, New Delhi, etc in the areas of technological development, design and product development and human resource development. The availability of abundant raw material base, large domestic market and the opportunity to cater to world markets makes India an attractive destination for technology and investments. Source:

Secretariat For Industrial Assistance Department of Industrial Policy & Promotion Ministry of Commerce and Industry Govt. of India Udyog Bhawan, New Delhi - 110 011 SIA Website : http://indmin. nic. in (http://www. indianshoebazaar. com/ind_india. asp) 1. 1 Production capacity of Shoe Industry The leather industry is spread in different segments, namely, tanning & finishing, footwear & footwear components, leather garments, leather goods including saddlery & harness, etc. The estimated production capacity in different segments is as under * Hides:64 million pieces Skins:166 million pieces Footwear & Footwear Components * Shoes:100 million pairs * Leather shoe uppers:78 million pairs * Non-leather shoes/chappals etc:125 million pairs * Leather Garments:6 million pieces * Leather Products:70 million pieces * Industrial Gloves:40 million pairs * Saddlery:6000 pieces The major production centers for leather and leather products are located at Chennai, Ambur, Ranipet, Vaniyambadi, Trichi, Dindigul in Tamil Nadu, Calcutta in West Bengal, Kanpur in Uttar Pradesh, Jalandhar in Punjab, Bangalore in Karnataka, Delhi and Hyderabad in Andhra Pradesh.

Current market scenario The Indian footwear market is estimated to be over 10,000 Crores in value terms and is growing at the rate of 810% over the years. In this Men’s footwear account to be 50%, whereas, women’s share constitutes to be 40% and the remainder are covered by kid’s segment. In this total market demand, about 42% are brand-driven. And Bata is covering about 12% of the organized footwear segment. Raw material supplies There exists a large raw material base. This is on account of population of 194 million cattle, 70 million buffaloes, and 95 million goats.

According to the latest census, India ranks first among the major livestock holding countries in the world. In respect of sheep with 48 million sheep’s, it claims the sixth position. These four species provide the basic raw material for the leather industry. The annual availability of 166 million pieces of hides and skins is the main strength of the industry. This is expected to go up to 218 million pieces by the end of year 2000. Some of the goat/calf/sheep skins available in India are regarded as specialty products commanding a good market.

Abundance of traditional skills in training, finishing and manufacturing downstream products and relatively low wage rates are the two other factors of comparative advantage for India. (http://leather. indiabizclub. com/info/indian_leather_industry_overview) 1. 2 Export and Import overview India's export of Leather ; Leather Products has reached US $ 3. 47 billion in dollar terms and Rs. 14, 000 crore in rupee terms. In dollar terms, there has been an export growth of 13. 67% and in rupee termsl. 13%Footwear alone holds a major share of 42. 44% in India's total leather products export trade.

As against the export target of US $ 3042 million for the financial year 2007-08, the achievement was 114. 32% Footwear is the engine of growth for the entire Indian leather industry and India is the second largest global producer of footwear after China, accounting for 14% of global footwear production of 14. 52 billion Pairs. India produces 2065 million pairs of Different Categories of Footwear (Leather Footwear 909 million pairs, Leather Shoe uppers 100 million pairs and Non-leather footwear 1056 million pairs) India exports about 115 million pairs. Thus, nearly 95% of its production goes to meet its own domestic demand.

Footwear exported from India are Dress Shoes, Casuals, Moccasins, Sport Shoes, Horrachies, Sandals, Ballerinas, Boots, Sandals and Chappals made of rubber, plastic, P. V. C. and other materials. MNC Brands sourced : from India| | Acme, Clarks, ColeHann, Deichmann, Ecco, Elefanten, Florsheim, Gabor, Hasley, Hush Puppies, Double H, Justin, Marks & Spencer, Nautica, Nike, Nunn. MNC Brands Sold in India: | Bally, Clarks, Hush Puppies, Lee cooper, Lloyd, Marks&Spencer, Nike, NineWest, NewBalance, Reebok, StacyAdams| Indian Brands sold in India: Red Tape, Bata, Liberty, Khadims, Lakhani, and Action Note:- Nearly 75% of India’s Export of Footwear is to the European Countries and the USA. * The Indian Footwear Industry provides employment opportunities to a total of 1. 1 million people, mostly from the weaker sections of the society. Out of this, about 0. 2 million are employed in the organized sector, 40% of who are women. Remaining 0. 9 million people are engaged in unorganized footwear sector like rural artisans, cottage and household units etc. * The Footwear Sector is now de-licensed and de-reserved, paving the way for expansion of capacities on modern lines with state-of-the-art machinery.

To further assist this process, the Government has permitted 100% Foreign Direct Investment through the automatic route for the Footwear Sector. Footwear export has increased from US$40. 15 million in 1977-78 to US$ 1475. 83 million in 2007-08 Chart showing Global Import of footwear Vs. Indian Export of Footwear India’s Exports of Footwear – Country-wise Share in Total Exports (2007-08) Source: DGCI& S The European Union and the USA are the major markets for Indian Footwear accounting for 79. 95% and 9. 22% share respectively in India’s total footwear export.

The major markets for Indian Footwear are Germany 16. 66%, UK 16. 31%, Italy 15. 32%, USA 9. 22%, France 7. 81%, Spain 5. 10%, Netherlands 4. 91%, Portugal 2. 50%, UAE 2. 48% and Denmark 1. 18%. These 10 countries together accounts for nearly 81. 49% of India’s total leather products export (http://footwearsinfoline. tripod. com/export_import. htm) Note :- 20% of total Indian shoe production comes from Bata. i. e. about 8 crore pairs. 1. 3 Role Of Government In Shoe Industry Of India Jairam Ramesh Minister of state for Commerce has announced Rs. 1. 6-billion (Rs. 60-crore) package to boost the local shoe industry, but the state government, chief minister opposed this. Ramesh made the announcement on Saturday when he was inaugurating an international fair on leather, footwear components and technology at the Kalakriti Grounds near the Taj Mahal. The package comprises of Rs. 600-million Leather Park, Rs. 200-million footwear design development centre, Rs. 100-million design studio, a testing laboratory and a permanent exhibition ground to be developed on investment of Rs. 500-600 million, on similar to Pragati Maidan exhibition in New Delhi.

Local shoe manufacturers have been asked to look for land. But there’s a problem the land for the projects has to be released by the state’s ruling party (which is the Congress’s opposition party). Agra’s old shoe industry directly and indirectly supports 100,000 families, mostly from the dalit community. Mayawati of BSP opposed to Ramesh of Congress Party that heads the United Progressive Alliance (UPA). According to shoe industry sources, Mayawati won’t be in a hurry to release land for any of the projects announced. But the industry believes once the schemes starts, exports could reach Rs. 0 billion (Rs. 3000 crore) from the present level of around Rs. 8 billion (Rs. 800 crore). More than 200 national and international components and raw materials manufacturers have put up their stalls at the exhibition. (http://www. thaindian. com/newsportal/politics/big-boost-for-agras-shoe-industry-if-state-government-helps_100116975. html#ixzz0XAkn7VPx) Design-cum-Resource Centre for Footwear & Leather Industry Leather goods and shoes as well as items of fur are being manufactured in the Small Scale Industry/Tiny sector traditionally in Srinagar and Jammu.

The Central Government would make an initial contribution of Rs. 1. 00 crore as grant for setting up a Design/Resource Centre and National Leather Development Programme (NLDP) will provide assistance for machinery, training and salaries of professionals. Under the National Leather Development Programme, exclusive assistance will be provided to market finished leather products of the artisans of the State in the form of buyer seller meets and exhibitions. (jammu. gov. in/departments/... /Central-Policy%20and%20Procedures. df) 1. 4 Raw Material For Shoes * Synthetic leather * Shoe leather * PU leather * Air blown PVC soles * PU welted sole * TPR soles for men * PU sleeper sole * PVC gents sole * PU shoe sole * Emulsion polymers (latexes) * Pell ethane thermoplastic polyurethane elastomers * Polyurethanes * Voralast polyurethane system * Microfiber leather (www. tradeindia. com/seller... 38/shoes-materials-accessories. html) 2. Organization Profile Business Type: Footwear Main Market: India Founder: Tomas Bata Chairman: P. M Sinha

Turnover: 1012 Cr. Employees: 6800 approx. Company Address: 22/4, Nukuleshwar Bhattacharya Road, Kolkata-700026 Phone: 033-24631657/8 Fax: 91- 124 4100883 Site URL: www. Bata. in Face Value: 10 Share Price: Bata India listed on BSE and NSE Current Price- NSE Price Rs 253. 90(As on 22/1/2010) BSE Price Rs254 (As on 22/1/2010) 2. 1 Share Holding Pattern: Promoter Holding-51. 02% Non Promoter Holding-13% Public and Other-23. 06% FII-11. 50% (Bata India Ltd. ) 2. Board of Director: As per company records, the board of directors of the company presently comprises the following. Name| Designation | Date Of Appointment| Mr. P M Sinha| Chairman| April 16, 2004| Mr. Marcelo Bravo| Managing Director| Feb 11, 2005| Mr. Pradip Kumar| Deputy Managing Director| August 25, 2001| Mr. Jaswant Singh| Director Marketing| August 1, 2002| Mr. A. K. Thakur| Nominee Director UTI| December 11,, 1996| Mr. V. Narayanan| Director| January 2, 1995| Mr. Constantin | Director| March 10, 2004| Mr. Shaibal Sinha| Director Finance| Feb 2, 2005|

Mr. Amit Mitra| Director| Feb 2, 2005| Mr. N. Sankar| Director| Feb 2, 2005| Brief Details of Board of Directors Mr. P. M. Sinha Mr. Sinha is the former CEO of Pepsi Cola International South Asia and was the Chairman of Pepsico India Holdings and President of Pepsi Foods Limited. He was also on the Management Committee &Director of Hindustan Lever Limited for eleven years, before he joined Pepsico in 1992. He is currently on the Boards of ICICI Bank, Wipro Limited, Indian Oil Corporation Limited, Lafarge India Pvt. Limited. Mr. Marcelo Villagran Bravo

Mr. Marcelo Villagran Bravo has more than 34 years of experience with the Bata group. Before joining the Company as a Managing Director, he was working with one of the most successful companies in the Bata group, i. e. Bata . Chile. He has wide operating and sales experience. He is a commercial engineer and a Bachelor of Business Administration. Mr. Pradip Kumar Nag Mr. Nag graduated in Commerce with Honours from Goenka College of Commerce and Business Administration under Calcutta University and is a member of All India Management Association. Mr.

Nag has a rich experience in multifarious areas of Accounting, Financial Management, Taxation, Costing Principles and Methods and Administrative functions encompassing over three decades. He held the position of Senior Vice President, Finance in the Company for over 5 years. Mr. Nag undertook training in Toronto, Chicago, Ottawa and Philadelphia in various areas of Retailing, Financial Accounting and Management Reporting in connection with . SAP. Project for North American BSO Companies. He was appointed by Bata Limited, Toronto, Canada (The International Headquarters of Bata Shoe Organization) as Director .

Enterprise Controlling. for Integrated Business Systems and was closely associated with successful implementation of . SAP. Integrated Business Systems in Retail Canada and User Support Programme. Mr. Jaswant Singh Mr. Singh joined the Company in 1971 as a Management Trainee. Marketing and had also undertaken training for 18 months in the Retail and Wholesale Departments. Mr. Singh started his career with the Company way back in 1971, and in the year 2000, he was made Managing Director, Bata Shoe Co. Uganda Limited, which position he held till his transfer to Bata India Limited in the year 2004.

Mr. Singh has wide experience in Retail, Wholesale, Brand Management, Production, Merchandising and General Management. During his career he has attended various courses being MARKETCO, Monssey, France, 1983, ADVANCO, Chicago, Toronto, 1990, EMP (Executive Management Programme) NYC, Toronto, 1998, Company Managers Programme Toronto, 2000 and has represented the Company at several Shoecons, namely Milan, Padova, Prague and Chicago. Mr. Singh was awarded an Achievement Award by Mr. Thomas G. Bata at Milan in 1990 for North Star. Mr. A. K. Thakur Mr. A. K. Thakur is a B.

Com from Calcutta University and a Chartered Accountant. He is the former Executive Director of Unit Trust of India. He has worked in almost all the key areas of Unit Trust of India and actively participated in formulating various corporate policies, procedures and strategic decisions. Mr. V. Narayanan Mr. Narayanan is the former Chairman and Managing Director of Ponds (India) Limited. He is a product of the Lawrence School at Lovedale and the Loyola College, Chennai. Mr. Narayanan began his career in 1959 as a Management Trainee in Hindustan Lever Limited (HLL).

In his ten years with HLL, he specialised in Sales and Marketing, both in India and in the UK. He joined Chese brough Ponds Inc in 1968 as its Marketing Director and became Chairman and CEO of Ponds (India) Ltd. in1978. After his retirement from Ponds (India) Limited, Mr. Narayanan is on the Board of several leading companies. Mr. Constantin Salameh Mr. Salameh has worked for 19 years with Hewlett Packard, which he joined in 1984. He has worked in a number of senior management positions in this company in sales, marketing and financial services in Europe and Asia Pacific.

The last two positions held in Hewlett Packard were Vice-President and Managing Director of Financial Services in Asia Pacific (1996-1999) and in Europe, Middle East and Africa (2000-2003) with full P & L responsibilities for a US$ 2. 5 billion financing business. Mr. Salameh completed his University degrees from King`s College, England (B. Sc Engg. with 1stclass honours in 1979), M. Sc. Engg. from M. I. T. in 1980 and his MBA from Stanford University(USA) in 1984. His board affiliations are with the American University of Beirut and the University of Geneva. Mr.

Salameh frequently addresses external audiences. Including the Management Centre Europe, Euromoney, International Technology Management, Asia International and World Bank Conferences on operational aspects of captive finance entities, business planning and financial management practices from a global perspective. Mr. Shaibal Sinha Mr. Shaibal Sinha qualified as a Chartered Accountant in 1986. He has worked with Eicher Limited, Toyota (in Muscat) and with Shaw Wallace and Company Ltd. His last assignment was with Reckitt Benckiser in U. K. and in India, where he has worked for the last eight years.

Dr. Amit Mitra Dr Amit Mitra did his Masters in Economics from Delhi School of Economics in 1970 and further attained the Doctorate Degree in Economics from Duke University, USA in 1978. Later he taught in major Universities in the United States over a decade and received the prestigious Sears-Roebuck Foundation Award for Distinguished Teaching, 1990. Furthermore, he has wide Post Doctoral Research experience as senior consultant. In addition to the Company, he is also on the Board of Directors of Steel Authority of India Limited (SAIL), GAIL (India) Limited and Principal PNB Asset Management .

He is also a Member on the Advisory Board of The India Fund of The Unit Trust of India (UTI), Member of the Central Advisory Committee, Central Electricity Regulatory Commission, Member of the Life Insurance Council, Member of the "India-China Eminent Persons Group" from the Indian side, Member of the Central Listing Authority constituted by SEBI, Member of the Advisory Committee to Union Commerce Minister of India on International Trade (WTO), and Member of the "Indo - EU Roundtable" from the Indian side (initiated by Government of India and the European Union (EU)).

He is and also has also been a part of several committees and sub-committees constituted by various ministries in the Government of India. Mr. N. Sankar Mr. N Sankar (59) holds a Masters Degree in Chemical Engineering from the Illinois Institute of Technology, Chicago, USA. He is the Chairman of The Sanmar Group and its associates, which operates in diverse areas such as Chloro-chemicals, Speciality Chemicals, Shipping, Engineering, Insurance, and Cement. The turnover of the Sanmar Group (including its associates) is close to Rs. 30,000 million.

The Sanmar Group has long-standing and well-established joint ventures with leading international corporations like Emerson Electric, Tyco, Flowserve and Cabot of the USA, and AMP of Australia. The Sanmar Group currently has nine joint ventures. Mr. Sankar also serves on the Board of a few institutions outside the Sanmar group, such as F. L. Smidth Limited. Over the years, Mr. Sankar has held office in several public bodies representing trade and industry, such as the President of Assocham and the Chairman of the Indo-US Joint Business Council.

He has also received awards recognizing his services to business and industry, including the ‘Lala Shriram National Award for Leadership in Chemical Industry. from the Indian Institute of Chemical Engineers. 2. 3 Management Organization Structure Insurance GGGFFFFF BS g B S Das Retail Flagship(West) S K Dwivedi Retail Flagship(West) S K Dwivedi Retail Flagship (East) A Nandy Product Development F Ferraris Merchandising Vinesh Singh Advertising & Comm. Tumpa Roy Retail Analysis S Chakraborty Company Secretary A B Anand Information Systems K Raman

Costing & Efficiency S Ranjan Retail Flagship & City C C Ponnappa Retail Family (West) S Nagarajan Retail Family (East) & Bazaar C Roy Retail Family (South) R Sengupta Retail Family (North) G P Sahu Wholesale V Anand Exports S Dixit Southcan S Maitra Sandak Opender Singh Faridabad S D Singh Mokamehghat S R Raha Bataganj T R Salaria Production Merch. Coord S D Singh Batanagar P Gupta Personnel & H. R. S Ganguly Finance Hemant Sultania Finance, H. O. Kisor Sen Special Projects S Chakravarty Corporate/Admin. / Legal/Tax M J Z Mowla 2. 4 HISTORY All about Bata

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. http://www. sharekhan. com/marketcorner/detailedreport. aspx? type=COMP-His;SSKIcode=Bata) 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 1250 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.

And the new face of Bata India is now visible to the industry as well as its customers. Today, backed by a brand perception of experience, the company is working towards positioning itself as a vibrant and contemporary young brand. Key Milestones Date/Year | Event| 1894| The Bata Shoe Organisation was founded by Tomas J. Bata, a ninthgeneration shoe maker| 1931 | The Company was incorporated in India. | 1933 | The production of footwear commenced in a rented premises at Konnagar, a few miles away from Kolkata, where for the first time rubber and canvasshoes were manufactured in India. October 28,1934| The foundation stone was laid on land purchased from the PortCommissioners and small landowners in the outskirts of Kolkata and the first manufacturing unit was set up, at a place now known at Batanagar. The factory shifted from Konnagar to Batanagar| 1936 | The construction work at the Batanagar factory was completed, and factory operation shifted from Konnagar to Batanagar. Towards the end of 1936, the factory produced leather footwear for the first time| 1937 | Batanagar tannery became operational towards the end of 1937| 1939| The Batanagar factory was complete in terms of every activity related ofootwear. The Batanagar township grew to become self-sufficient with theacquisition of more land and the erection of schools, places of worship,hospitals, entertainment and recreational centres. | 1940-45. | During the World War II the factory’s production was geared to meet war requirements. | 1942 | A footwear manufacture plant, a machinery department was set up atBatanagar, which produced the first India-made major shoe machine. Simultaneously, several auxiliary departments were started. This wasfollowed by the setting up of the factory at Bataganj, Bihar. 1950| Bata successfully launched the brand . Hawai. | 1951 | The rubber/canvas factory was set-up at Faridabad, Haryana. | 1952 | One of Asia’s largest tanneries was set-up at Mokemehghat, Bihar. | 1988| The Bata factory was set-up in Peenya, Bangalore| 1994 | The Company’s factory at Hosur in the State of Tamil Nadu becameoperational, which was originally an Export Oriented Unit, but now caters to the domestic Indian market| 1993 | Batanagar factory became the first Indian shoe-manufacturing unit to receive the ISO 9001 certification. | (http://www. sebi. gov. in/dp/bata. pdf) 2. Our 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 (http://www. bataindia. com/page. php? kon=5_2_1) 2. 6 Our commitments * Your Purchase Guarantee In case of any problem, bring back the pair shoes with in the next 15 days from the date of purchase and we will replace it with another pair.

Condition apply. * Wide collection With more than 1000 different designs to choose from, we have one of the widest selection shoes, handbags and accessories. * Assured Quality Strict quality measure are followed during and often the production of all our products. We have our own factories and warehouse that are supervised by trained and experience personas. * Personalized Attention In all our stores, our trained professional sales staff is at your service. In case you have any query about Bata products or services, please feel free to ask for any assistance. Product Detail We ensure that you get complete detail of all our products in the most convenient way. Each item carries tags that clearly mention type, price, size or other necessary information. It not only saves your time but also helps you in your selection. (http://www. bataindia. com/page. php? kon=4_0) 2. 7 Bata India - Today * Sells over 45 million pairs of footwear every year * Serves over 120,000 customers every day * Sells through over 1200 retail stores * Operates 5 manufacturing facilities * Employs more than 6800 people (http://www. bataindia. om/page. php? kon=5_2_1) 2. 8 Brands Of Company Subsidiary Companies Of Bata India Bata global Hush Puppies In 1958, during the exciting atmosphere of change the Wolwerine Company created the world's first casual shoe and provided a new alternative in footwear. Hush Puppies emerged as a soft, breathable and very comfortable shoe. A truly modern creation that was immediately embraced for its authentic style and casual flair. This unique invention would not only change the kind of shoes we wear, it would also herald the beginning of today's relaxed style.

Year by year, country by country, decade by decade the world was getting casual with Hush Puppies. Hush Puppies is still growing championing the same easy going style Hush Puppy is known for Relaxed and classic in design Hush Puppies is always defined what it means to be modern and casual. Today Hush Puppies continues to innovate bringing technical excellence in genuine style to over 120 countries by application of various types of technologies like: Hush Puppies Bounce technology for shock absorption and energy return in every step.

Wave Reflex outsoles provide complete freedom of movement for your feet. Natural latex rubber and unique reverse action design waves unite to provide ultra flexibility. 100% relax, Hush Puppies collection of innovative, auth entic casual footwear, mixed textures of soft casual leathers and rich Hush Puppies worry-free suede. The desire for a fashionable and casual life, a young idea in 1958 is now the aspiration of generations of people worldwide. Scholl The name Scholl today is synonymous with feet and foot care in over 70 countries throughout the world.

This heart-felt fascination with feet, this dedication and drive, formed the foundation of the company and the Dr Scholl spirit and legacy are as much a part of the brand today - 100 years on. Dr Scholl's from Bata provides you with maximum comfort whole daylong. The unique Anatomic Insole will give your feet that extra cushioning needed to keep all stresses at bay from your feet while providing support from all sides. The ribbed surface of the insole gently massages your feet while walking. This boosts the circulation and keeps you active all the day.

The soft sole absorbs all the shocks while walking. North Star North Star is synonymous with street cred. Stylish, trendy comfortable and durable, the range is ideally suited to the urban environment. The youth market is attracted to the brands retro styles, including designs from the late 80s as well as contemporary interpretations, making it a highly sought after brand name. It's a casual yet fashionable street-style shoes that caters to the young at heart. North Star Shoes have graphics and prints and are shoes of style and edge.

They are in all types of materials, with the looks of casual cool. Power Power is a Bata International Brand, which continues to spark an emotional connection with the masses by providing athletic footwear at very affordable prices. First launched in 1972, it has created a niche for itself in the sports segment. POWER is inspired by the same passion to perform that is inherent in the athletes who use our products. POWER as a brand stands for Durability, Trends, Responsiveness, Performance and value.

Power offers a Sporty range of basic as well as performance -oriented shoes at unbeatable prices. It's the Right Match for your active life style – be it Jogging, Running, Adventure, Cricket, Badminton, Tennis and lifestyle. Power products are equipped with unique features and benefits that differentiate Power footwear from competitors, provide professional services to our customers and ensure the Right products are delivered in the Right time in the Right price. Power Slogan: “A new terminology replacing “Value”, The Power customer is a Smart consumer, not just a value consumer. Marie Claire Marie Claire, a fashion lifestyle brand of shoes with a touch of elegance that caters to the young cosmopolitan women. Bata Brands is the trademark owner of Marie Claire for shoes worldwide (except in Japan and Korea). Marie Claire stands for Contemporary and modern styling, adaptive to an active lifestyle yet elegant and feminine. Subtle fashion trend details and quality products with a clean finish, it is a brand that brings out every woman's confidence ; individual style. Marie Claire Emphasizes on its style, quality and value. Bubblegummers

Bubblegummers is the leading children's footwear brand in India and has an extensive presence in Latin America, Asia and Europe. Bubblegummers offers good quality, comfortable, funny and colorful shoes for kids. Developed to the strictest standards of quality, all shoes are produced with state-of-art technology to ensure healthy foot growth, and parents can be assured that their children will enjoy these shoes in total comfort and safety. It is our constant Endeavour to give you the best in styles, colors and comfort, and our priority to deliver superior standards of product and service to all our customers.

We believe that our greatest strength and asset is the trust of our customers, which enables us to sell close to 1. 5 million pairs of Bubblegummers per year. 3. Internal Environment & External Environment The Internal factors include strengths and a weakness focuses of the firm. Strengths refer to core competencies that give the firm an advantage in meeting the needs of its target markets. Company strengths should be market oriented/customer focused because it assists the firm to understand customer needs. Weaknesses refer to any limitations a company faces in developing or implementing a strategy.

Weaknesses should also be examined from a customer perspective so that they can understand their weaknesses from customer point of view. The External Analysis contains or examines opportunities and threats that exist in the company. Opportunities and threats are independent factors of the firm. If we understand our Opportunities properly it refer to add favorable conditions in the firm that could produce rewards for the organization . Threats refer to conditions or barriers that may prevent the firms from reaching its objectives. The following area analyses are used to look at all external factors affecting a company . 1 HUMAN RESOURCE POLICY: when they set-up their factory in India, their approach was to hire local labor and trained them making shoes. As the technology advanced they trained their employees on machine. But, for special tasks they hired person who were in occupation of shoe making. As the demand increased they developed their vendors in places like Agra, Noida, Gurgaon etc gave them their requirements to manufacturer per their quality standard. The policy in this regard was to frame their vendor. The company has number of welfare schemes for their employs to encourage stability.

Regular training programs are held for the employs and the lower level minimum wages are given but incentives are linked and outcome. Same way the company has their outlet for sale where the employs are on the pay role of Bata. The functions of any management are planning, organizing, staffing, directing and controlling. The management of Bata performs these functions efficiently. All divisions of Bata are taken care of by different set of managers. The management at Bata knows the importance of customers to its business. It has a good image in the minds of the customers.

It caters to a large class of customer for middle class and lower middle class customers. The management of the brand performs many functions e. g. it takes up the work of brand repositioning very often. It also works for social causes such as it employs physically challenged people and it is also working towards women empowerment by employing more and more women. The management also takes care of the environment. The organization always gives due importance to its employs. It provides many facilities to its employees such as the creche facility, medical facilities, transportation etc. he industry also celebrates birthdays and long service etc. All these motivates the employees to achieve the goals and objectives of the organization. Common Components Of Human Recourse Managements: * Hiring component and qualified employees * Assigning and classifying employees effectively * Motivating employees to perform optimally * Stimulating employees professional growth and development * Evaluating and compensating employees fairly * Rewarding employees for their efforts * Providing in service education opportunities 3. 1. 1 Staffing Process Recruitment Recruitment

Promotion and Career Planning Performance Appraisal Training and Development Placement and Orientation Selecting from among the Applicants Compensation Promotion and Career Planning Compensation Performance Appraisal Training and Development Placement and Orientation Selecting from among Applicants 3. 1. 1(a) Recruitment Process Ensures that provided candidates, are most suitable for your specific requirements. Our trained consultant’s pre-screen and pre-select applicants before submitting their details - for we want to assure accurate matching between our company and any prospective employee. Collection of Curriculum Vitae from applicants interested in one or more of our offers. Every Curriculum Vita is written in the Bata format, which allows for easy comparison of each candidate's details. * Performing the first telephone interview in order to make preliminary assessments of the overall competency of a candidate, especially in regards to their level of English. * All documents are then collected and reference checks are performed including employment history, criminal background and health checks. If the panel is fully satisfied with the results and feel confident that the candidate is suitable for your specific requirements, then the second interview is done and later sends the application to the potential employer who then obviously makes the final decision. * The final interview is then conducted at Krakow, head office. * Also, arranging travel for any prospective employee to ensure the final step runs smoothly. 3. 1. 1(b) Selection Process The selection process is objective and robust. Bata selects talent for the Technical function from FDDI.

Engineers from disciplines such as Mechanical, Electronics, Production Engineering and Chemical are considered for placement. The process starts in August each year with a campus visit and a pre-placement presentation. This provides an opportunity for young aspirants to learn more about the Company, its achievements, its strategies and the kind of careers they can look forward to. * A range of selection tools are used. These include assessment centres, group tasks and in-depth personal interviews. * Candidates found suitable for employment are immediately given offers to join Bata in July of the following year.

After a comprehensive induction programme, they are assigned to various businesses of the Company. Bata also selects first-year students for Summer Internships A team of Bata managers visits campuses once again between December and March for final placement. The process consists of group discussions and personal interviews preceded by psychometric tests and assessment centres. Employment offers are made to selected candidates immediately. On joining Bata in July, candidates undergo an induction programme before being assigned to one of the Company's businesses.

Employment offers are made to selected candidates immediately. On joining Bata in July, candidates participate in an induction programme. Thereafter they are assigned to responsibilities in Trading, Sourcing and Logistics in the Agri Business Division. Bata believes in taking out the best out of the pool of application received during recruitment process. It believes in infusion of new blood in their organisation. 3. 1. 1(c) Training and Development Training has become most crucial aspect in Bata because of chanding standards of technology and its services.

Training courses are sometimes offered for 6 months with internship so it invites fresher’s which are motive of Bata. Training is given by practical demos with latest and modern machines and equipments and is conducted professionally. 3. 1. 1(d) Retirement Benefits * The liability for Gratuity and Pension is computed and provided as per the actuarial valuation report. The liability so provided is represented substantially by creation of separate funds and is considered sufficient to meet the liability as and when it accrues for payment in future. Expenditure in respect of early voluntary retirements is written off as a period cost. Retirement benefits in the form of Provident Fund are charged to the Profit and Loss Account for the year/ period when the contribution to the respective funds are due. * Leave encashment benefit is accounted for on basis of actuarial valuation. * Expenditure in respect of early voluntary retirements is written off over 5 years as a period cost. 3. 2 Employee Categorization: Employees of the Company are categorized along the following grades, in descending hierarchical order • Directors • Senior Managers (Senior Vice President, Vice President, General Manager) • Middle Managers • Junior Managers Selling personnel • Shop Managers • Shop Employees Additionally, the Company employs direct and indirect workmen at its factory sites. The number of permanent employees currently on the payroll of the Company is 9,969 as on January 31, 2005. 3. 3 Corporate Social Responsibility: The following CSR activities were undertaken by the Company during the year: - Sponsorship of Rain Water Harvesting Project in Gurgaon. - Donation to Bihar Flood Relief Fund. - Free shoes to Orphans on Republic Day. - Free medical camp for under privileged caretakers of Kolkata Maidan and physically handicapped. lnauguration of Bata Cricket School in October 2008. - The Company operates two Higher Secondary Schools, one for boys and one for girls and three Primary level Schools " and also one Nursery School. The children of our employees and neighbouring localities get educational facilities from these institutions. - The Company encourages entrepreneurial spirit in the small scale businesses located in the vicinity of its factories so that they become independent associates and partners in progress with the Company. This generates large employment in the area and gives people the opportunity to grow in their businesses. The Company maintains a temple, -a church and a mosque where employees and people from the different communities in the neighbourhood participate in prayers. - The Company actively participates in organizing Blood Donation Camps and distribution of fruits and sweets to the ailing patients at the Batanagar Hospital and Ramakrishna Mission Residential School at Batanagar. (http://content. icicidirect. com/Research/DirectorsReport. asp? icicicode=BATIND) 3. 4 Manpower: Bata have more than 65oo employs. Bata has a supportive manpower policy. Bata received the “Great place to work award” on 9 June 2009.

Bata does not indulge in human right abuses. There is no form of forced or compulsory labor Bata. The industry has a labor union and also has a mutual agreement with the union. Bata do not indulge in child labor and also does not let its suppliers to do so. The company does not discriminate anyone on the basis of sex, disability etc for employment as per Bata code of conduct. 4% of Bata workforces are people with disability and measures are taken to take care of their special needs. Measures are also taken to avoid any kind of bribery and extortion. 3. 5 Marketing Environment

Marketing is the process by which companies advertise products or services to potential customers. It is an integrated process through which companies creates value for customer and build story value from customer into return. Importance of understanding the environment The managers job cannot be accomplished in a vacuum within the organization. There are a number of factors both internal as well as external which jointly affect managerial decision-making. It is therefore very important for the manager to understand and evaluate the impact of the business environment due to the following reasons : ) Businesses may be doomed to be non starters due to restrictive business environment which may take the form of rigid government laws (no polluting industry can ever be located in around 50 Km radius of the Taj) , state of competition (Car manufacturing capacity presently in the country is far in excess of demand) etc. b) The present and future viability of an enterprise is impacted by the environment For eg no TV manufacturer can be expected to survive by making only B&W television sets when consumer preference has clearly shifted to colour television sets. ) The cost of capital and the cost of borrowing - two key financial drivers of any enterprise are impacted by the external environment . For eg the ability of a business to fund its expansion plan by raising money from the stock markets depends on the prevalent public mood towards investment in stock markets. d) The availability of all key inputs like skilled labour , trained managers , raw materials , electricity , transportation , fuel etc are a factor of the business environment. ) Increasing public awareness of the negative aspects of certain industries like hand woven carpets ( use of child labour ) , pesticides (damage to environment in the form of chemical residues in groundwater), plastic bags (choking of sewer lines) have resulted in the slow decline of some industries. f) Finally , the environment offers the opportunities for growth and profits . For eg when the insurance and aviation industry was thrown open to the private sector , the new entrant could easily build on the expectations of the public. Consumer Technological Environment Demographic Environment Intermediaries

Logistics R&D Marketing Product Place Satage-5 Purchasing Production Public Supplier Price Stage-4 Promotion Stage-3 Engineering Production Stage-2 Competitors Social cultural Environment Political Legal Environment Stage-1 Figure: Marketing Environment Chart 3. 5. 1 Stage-1 (Macro-Environment) 3. 5. 1(a) Demographic Environment Demographics tell marketers who current and potential customers are; where they are; and how many are likely to buy what the marketer is selling. Demography is the study of human populations in terms of size, density, location, age, sex, race, occupation, and other statistics.

Changes in the demographic environment can result in significant opportunities and threats presenting themselves to the organization. Major trends for marketers in the demographic environment include worldwide explosive population growth; a changing age, ethnic and educational mix; new types of households; and geographical shifts in population. i. Worldwide population growth: ii. Population age mix: iii. Ethnic market iv. Educational groups v. Household patterns vi. Geographical shifts in population Demographic Of India Population:| 1,166,079,217 (2009 est)| Growth rate:| 1. 48% (2009 est)| Birth rate:| 22. 22 births/1,000 population (2009 est)| Death rate:| 6. 4 deaths/1,000 population (2009 est)| Life expectancy:| 69. 89 years (2009 est)| –male:| 67. 46 years (2009 est)| –female:| 72. 61 years (2009 est)| Fertility rate:| 2. 72 children born/woman (NFHS-3, 2008)| Infant mortality rate:| {{{infant_mortality}}}| Age structure:| 0-14 years:| 31. 1% (male 190,075,426/female 172,799,553) (2009 est)| 15-64 years:| 63. 6% (male 381,446,079/female 359,802,209) (2009 est)| 65-over:| 5. 3% (male 29,364,920/female 32,591,030) (2009 est)| Sex ratio:| At birth:| 1. 2 male(s)/female (2009)| Under 15:| 1. 10 male(s)/female (2009)| 15-64 years:| 1. 06 male(s)/female (2009)| 65-over:| 0. 90 male(s)/female (2009)| Language:| Official:| Hindi, English| India has the second largest population in the world after China. But its population growth is far more than China and it is expected that India will have the largest population by 2020. India’s population, right now, is around 120 million. India has around 60% people below the age of 60 and 40% are above 60 and they are called the senior citizens in the society. India has around 68% literate people in the country.

The literacy rate is not very good as compared to other countries but is has shown growth in the past years. The urban areas have more educated people as compared to the people in the rural areas. The household pattern have seen a lot of change as people now prefer to stay in nuclear families and both husband and wife wants to work and earn for the family. People are shifting from rural areas to urban areas for the sake of employment and better opportunities. So, metro cities have highest number of migrants from other cities. Every city is famous for a profession, for example.

Bangalore is famous for IT professionals etc. Demographic Of Company For Bata, It have their stores all over India. But, basically they have more tores in the metro cities of the country because of the more educated people and high income service group of people living there and now Bata also planning to open their stores in tier-II and Tier-III cities. Educational Group: Educated Upto Higher Secondary Population: Upper Middle Class Middle class Lowe Middle class Age: 10-14 yr 15-18yr 19-26yr 27-35yr 36-50yr upto-50yr Income Distribution: Upto 20,000

Geographical shifts: Northern, Central, western India 3. 5. 1(b) Pest Analysis Pest analysis cover Economic Environment, Natural Environment, Sociocultural Factor and Technological Factor. This is imperative that an organization considers its environment before beginning the marketing process. In fact, environmental analysis should be continuous and feed all aspects of planning. The organization's marketing environment is made up of: The macro-environment e. g. Political (and legal) forces, Economic forces, Sociocultural forces, and Technological forces. These are known as PEST factors. Political Factors The political arena has a huge influence upon the regulation of businesses, and the spending power of consumers and other businesses. You must consider issues such as: 1. How stable is the political environment? 2. Will government policy influence laws that regulate or tax your business? 3. What is the government's position on marketing ethics? 4. What is the government's policy on the economy? 5. Does the government have a view on culture and religion? * Economic Factors The economic environment consists of factors that affect consumer purchasing power and spending patterns.

Economic factors include business cycles, inflation, unemployment, interest rates, and income. Changes in major economic variables have a significant impact on the marketplace. For example, income affects consumer spending which affects sales for organizations. According to Engel's Laws, as income rises, the percentage of income spent on food decreases, while the percentage spent on housing remains constant. Marketers need to consider the state of a trading economy in the short and long-terms. This is especially true when planning for international marketing. You need to look at: 1.

Interest rates. 2. The level of inflation Employment level per capita. 3. Long-term prospects for the economy Gross Domestic Product (GDP) per capita, and so on. Exchange| 52 Week High| 52 Week Low | BSE| 376| 76| NSE| 277. 89| 75| As we all are aware of the last FY in the globe, so there were many companies who suffer from the market condition. Bata desperate and long overdue search to make a style statement in the Indian shoe market for (formals shoe wear). The last report by the company is showing the dynamic condition of the market and it shows the way it climbs up and get down.

Bata at BSE on Dec 7, 2009 Current: 191. 40Rs; Volume: 30,363; Change (%):+1. 74. | (For forther details refer chap[ter-7 and 8) * Sociocultural Factors The social and cultural influences on business vary from country to country. It is very important that such factors are considered. Factors include: 1. What is the dominant religion? 2. What are attitudes to foreign products and services? 3. Does language impact upon the diffusion of products onto markets? 4. How much time do consumers have for leisure? 5. What are the roles of men and women within society? 6. How long are the population living?

Are the older generations wealthy? 7. Do the population have a strong/weak opinion on green issues? Indian culture is one of the ancient and famous cultures of the world. People are still connected to the culture in one way or the other. The companies manufacture its products using the Indian culture. Bata India have a lot of products which are related to the culture so that it can increase their sales because people prefer products related to the social environment of the country. Such as they have good quality of leather sober shoes, which attract the office going people.

Bata India has a clearly defined policy for Corporate Social Responsibility (CSR). As part of the company’s CSR initiative, the manufacturing units of shoes Divisions have acquired the certifications ‘ISO 9001: 2000 Quality Management System Standards’ and ‘ISO 14001:2000 Environment System standard’ emphasizing the efforts to be an ecologically responsible organization. The company’s diverse CSR initiatives include: * Children’s education * Enabling the disabled * Women’s empowerment * Environment management programmes * Miscellaneous community initiatives * Technological Factors

Technology is vital for competitive advantage, and is a major driver of globalization. Consider the following points: 1. Does technology allow for products and services to be made more cheaply and to a better standard of quality? 2. How is distribution changed by new technologies e. g. books via the Internet, flight tickets, auctions, etc? 3. Does technology offer companies a new way to communicate with consumers e. g. banners, Customer Relationship Management (CRM), etc? Technology has not only changed the working style in India but it has affected the world.

It has enhanced the working style of the people. It has accelerated the pace of working of the people. Not only has the acceleration of the pace but it also made the room for innovations that companies can try. R&D is one of the important component that company needs, so that, it can know what the customer wants from the company. Most of the companies are now using technological upgraded machineries. Note:- Bata India has entered into an agreements with Bata Ltd of Toronto (Canada) for the supply of technical know- how and services such as footwear technology, design and brand development.

Recent Technological Trends in the Industry: Role of Technology: Technology has expanded operations of the apparel and footwear industries to a more global scale. It has also provided closer working relationships between retailers and manufacturers. Technology has improved efficiency and has reduced the amount of manual labor. Computer Technology: Rapid improvements in computer technology have helped to shorten the new product development phase from years to practically months, especially in the fashion/style/high- performance areas.

Apparel marketers who are linked with retailers through quick-response programs and other technology go a long way toward making themselves indispensable to their customers. EDI Technology: collects information (such as the bar code that is attached to each item sold, the price of the product(s) sold, and details such as color and size) from the retailers’ checkout counter and relays the information back to the manufacturer. The data is then used for manufacturers to automatically reorder the stock of merchandise to replenish their shelves in a timely manner.

EDI also makes distribution and shipping information more efficient. 3. 5. 2 Stage-2 (Micro-Environment) 3. 5. 2(a) Suppliers • Reebok: Under this arrangement, the Company will purchase shoes from Reebok as per its requirement and earn a gross margin of 36% of the retail price. • Adidas Marketing Private Limited: Adidas Marketing Private Limited has agreed to provide the Company with its products in footwear, apparel, accessories at a Gross margin of 40% for footwear and 42% for apparel and accessories. Margins offered to Bata are subject to change in event of changes in the tax structure and business scenario. M&B Footwear Private Limited: M&B footwear Private Limited to provide the Company on an outright sale basis stocks of its brands . Lee Cooper. and . ID. at a margin of 40% of the retail price. M&B Footwear would advertise and promote Bata as its business partner. The term of this arrangement extend for three year starting April 30, 2003. • Sierra Industrial Enterprise Private Limited: Sierra Industrial Enterprise Private Limited has agreed to supply the Company their products . Lotto. , which launched in almost 50 flagship stores of Bata by mid-February 2005 and is expected to reach 250 stores by mid-August 2005.

Bata has agreed to purchase the products at an agreed Gross margin of 42% of the Retail price. • Planet Sports Private Limited: The Company has entered into a Consignment Agreement dated February 29, 2004 for a period of three year extending till February 29, 2007 with Planet Sports Private Limited for supply of footwear, apparel and accessories by the brand name . PUMA. at the maximum retail price or at a discounted price as provided by Planet Sports Private Limited and Bata will be entitled to a commission of 35% on the sales net of taxes. (http://www. sebi. gov. in/dp/bata. pdf) 3. 5. 2(b) Intermediaries

Distribution Channels Of Bata: Bata India markets its products through three distinct channels. • Company operated retail outlets: The Company operates its own retail network of over 1,100 retail stores spread across the country. These outlets are serviced through six distribution centers spread out geographically and each responsible for a particular region The process flow begins with the transportation of the finished products from the Company’s manufacturing units and contract manufacturers. plants to the distribution centers through the services of third party carrying and forwarding agents.

The distribution centers in turn transport these products to the Company operated retail outlets based on specific demand requirements. These retail outlets are manned by the Company’s employees and exclusively market the Company’s footwear brands. As part of its strategy to provide complete footwear solutions to customers, the retail outlets also market accessories like shoes laces, socks, shoe polish. In certain outlets, the Company also provides cosmetic services like pedicures, etc. Out of the 1,100 retail stores, the Company has designated 84 stores as factory outlets which are used to sell merchandise at marked down prices.

These factory outlets are used primarily by the Company to sell surplus or non-moving products and factory seconds stocks. Institutional sales as well as supplies to the civil and defense agencies are also taken care of through the Company’s distribution network. The Company has designated specific senior managers to oversee the marketing to this segment of buyers. The requirements are directly supplied from the Company’s distribution centers. • Dealer Network: The Company also uses the dealer network of the footwear industry to market its products.

Through this channel, the Company supplies its products to non-exclusive wholesale distributors who in turn distribute the Company’s products to independent dealers across the country. The dealers covered under this channel are non-exclusive Bata dealers and hence sell footwear and related products of other companies also. • Market Extension Programs: The Company is undertaking steps to generate volume business in semi-urban markets and markets which are un-represented and under-represented footwear markets, pursuant to its Market Extension Programs, through authorized Bata dealerships.

Under this programs, the Company appoints authorized dealers, subject to certain selection criteria who run outlets which exclusively market the Company’s products and adhere to rules and regulations of the Company. As on date, there are 470 such outlets in the country. The dealer outlets are not manned by Bata employees but are manned by the employees of the private dealer. (http://www. sebi. gov. in/dp/bata. pdf) 3. 5. 2(c) Competitors The footwear manufacturing industry globally and in India, is highly fragmented, with a large number of small and medium sized manufacturers having a local presence in China and India.

Their principal competitors in their manufacturing operations are Country | Competitor| India| | India| | India| | India| | India| | India| | Positioning Mapping (As per our group perception) PRICE LOW HIGH HIGH LOW QUALITY In comparison to its competitors, Bata is a reasonably priced brand with reasonable product quality. With respect to its international competitors, it is the most affordable as can be seen in the above illustration. All the competitors have better quality with higher prices. oodland has the highest price and quality in comparison to all the competitors of Bata. Whereas, relative to its Indian competitors, it is the highest priced but also offers the highest product quality. In case of Indian competitors, Relaxo and Lakhani is placed just a little below Benetton for its price and quality, and Sparks is the lowest priced with lowest quality with respect to the Indian competitors of Bata. STORES OF MAJOR RETAIL SHOES BRANDS IN INDIA RETAILER | PRESENT IN NO CITIES | Bata | All cities | Liberty | 225 | Metro | 31 | Woodland | Across India | M& B Footwear | All major cities |

Regal Shoes | 7 | Loft | 2 | Khadim’s | East & South of India | Sree Leather | West Bengal, Orissa, Bihar | | | 3. 5. 2(d) Publics Governmental Approvals And Licensing Arrangements In Last Decade The Company has the following approvals from the Government authorities as required to carry on the present business. However, certain approvals have expired in respect of which, the Company has applied or is yet to apply for renewals, as indicated corresponding to the relevant licenses. Licences/Permission/Approvals in respect of factory located at Sipcot, Batashatak, Hosur, Tamil Nadu. . Industrial Licence issued by the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry, Government of India vide letter dated July 27, 2000 bearing number CLR- 4412000 for the purpose of establishing a new industrial undertaking for the manufacture of leather footwear located at Plot No. 73 & 74, SIPCOT, Industrial Complex Phase . I, District Hosur (Dharampuri) in the State of Tamil Nadu. The date of expiry of this industrial license is July 27, 2002, and the Company had to commence commercial production by that date.

This license was issued subsequent to the Hosur factory. s conversion from an Export-oriented unit to a domestic producer, and the Company continued with commercial production in the aforesaid period. Thus, renewal application in respect of the same is not applicable. 2. Registration Certificate issued under the Central Excise Rules, 1944 by the Registering Authority dated November 29, 2001 for the purpose to cure, produce, manufacture, carry on wholesale trade/business/broker or commissioner agent or otherwise deal in excisable good, act as a user of excisable goods for special industrial purposes.

This registration certificate is valid until factory carries on the activity for which it is issued or until surrendered. 3. Authorisation and consent issued by Tamil Nadu Pollution Control Board dated September 12, 2003 bearing number 8179A for the purpose of operating the industrial plant