Bata to foray into rural markets & small towns; to invest in Rs 100 crore in FY15

KOLKATA: Bata, the country’s largest shoemaker, plans to foray into rural markets and small towns of less than five lakh people through distributors and franchisees for its next wave of growth. Bata India is currently developing a completely new line of merchandise to tap these unexplored markets, top company officials said.
The company plans to open 100 outlets in tier III and IV markets, which have a population of less than five lakh people, through the franchisee route. It will also tie up with wholesalers to sell shoes in rural shops. “We have already piloted 20 such Bata stores in smaller markets,” R Gopalakrishnan, managing director at Bata India, said.

“At the same time, we have set up a separate rural division in last six months which is piloting sales in villages in Rajasthan and Uttar Pradesh,” he told reporters on the side-lines of the firm’s 81st annual general meeting here on Wednesday.


The shoes sold in smaller towns will be priced up to Rs2,000, while those sold in rural shops cost up to Rs500. This is the second attempt by Bata to target the unorganised market, which accounts for two-third of the $35-billion Indian footwear market.
Two years ago, it had launched a new format, Footin, targeting young adults who mostly buy shoes from street shops due to their affordability. Bata India currently operates more than 1,400 shops, including 34 exclusive Hush Puppies stores and 21 Footin outlets.

Gopalakrishnan said the company plans to invest Rs50 crore this year to set up more than 120 Bata stores and 20 Hush Puppies and Footin stores each. The company is spending another Rs50 crore for modernisation of its three factories over the next 18 months. “While around 50% of the products are sourced from third-party manufacturers, Bata wants to retain its manufacturing edge,” Gopalakrishnan said.