Bata to focus on small markets, to increase e-commerce presence

The footwear major plans to add 100 new retail stores, 50 new franchise stores in FY18

Bata India is planning to increase its presence in rural areas and will increase its e-commerce presence to shore up sales, the company today said.

Speaking at the company's 84th annual general meeting, Bata chairman Uday Khanna said the company is aggressively penetrating footwear markets of tier-III and IV towns and has increased its focus to improve performance in single town Bata stores.

He said the footwear retail industry in India is accelerating and is providing immense scope for the company to reach out to different kinds of consumers in untapped markets of semi-urban and rural areas, including online marketplace.

Khanna said the footwear major has adopted a dual strategy of driving store growth, while adding new retail stores in malls and high street locations to ramp up margins.

The company's latest annual report says it plans to add around 100 new retail stores and 50 new franchise stores in the current year to increase its presence in malls, high street markets and in tier II and III cities in India.

"Today, we have close to 50 franchise stores and we have tested with 30 (franchise) stores last year. In the next five year, we look at 300-400 stores," company president Rajeev Gopalakrishnan said.

The footwear major will also look for premiumisation of products in metros.

"It is important for us to premiumise our products in the markets where it is needed. It has to be done in metros and mini metros," he said.

Khanna said changing customer expectations, technological advancement and rise in fashion conscious youngsters are giving a new business dimension to the footwear industry.

Speaking on the Faridabad manufacturing plant, which has been shutdown due to "unviable operations", company's Chief Financial Officer Ram Kumar Gupta said "We are evaluating various options about what will be done with the property. It will take time to finalise.