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Contents
Company Introduction...........................................................................................................................3
History...................................................................................................................................................3
Vision.....................................................................................................................................................3
Mission..................................................................................................................................................4
Operations.............................................................................................................................................4
Brands, Products & Services..................................................................................................................5
Men:..................................................................................................................................................5
Women:.............................................................................................................................................5
Kids:...................................................................................................................................................6
Overview of Strategic Planning Process.................................................................................................6
Description & Comparison of Various Strategic Planning Models.........................................................7
SWOT Analysis.......................................................................................................................................7
Strength:............................................................................................................................................8
Weakness:.........................................................................................................................................8
Opportunity.......................................................................................................................................9
Threat..............................................................................................................................................10
PESTEL Analysis....................................................................................................................................10
Political:...........................................................................................................................................10
Economic.........................................................................................................................................10
Social...............................................................................................................................................11
Technological...................................................................................................................................11
Environmental.................................................................................................................................12
Legal................................................................................................................................................12
PORTER’S Five Forces Model...............................................................................................................12
1. Threat of New Entrants................................................................................................................12
2. Bargaining Power of Buyers.........................................................................................................12
3. Bargaining Power of Suppliers.....................................................................................................12
4. Threat of Substitute Products:.....................................................................................................13
5. Intensity of Competitive Rivalry:..................................................................................................13
BCG Matrix..........................................................................................................................................13
Stars.................................................................................................................................................13
Cash Cows........................................................................................................................................14
Question Mark.................................................................................................................................14
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Dog..................................................................................................................................................14
Bata Pakistan – Internal Analysis.........................................................................................................14
Introduction to Internal Analysis:....................................................................................................14
Role of Internal Analysis in Assessing Organizational Capabilities:..................................................15
Internal Analysis of Bata Pakistan:.......................................................................................................15
Value Chain Analysis:.......................................................................................................................15
Core Competencies Identification...................................................................................................16
Competitor Analysis............................................................................................................................16
Market Share Analysis:....................................................................................................................18
Strategic Group Mapping.................................................................................................................18
Bata Financials.....................................................................................................................................18
Liquidity Ratios................................................................................................................................18
Asset Composition...........................................................................................................................20
Debt Ratios......................................................................................................................................21
Profitability Ratios...........................................................................................................................23
Risk Assessment and Proposed Strategies...........................................................................................24
Economic and political.....................................................................................................................24
Supply chain risks............................................................................................................................25
Regulatory risks...............................................................................................................................26
Security risks....................................................................................................................................26
Brand and reputation risks..............................................................................................................27
Competition Risks............................................................................................................................28
Technology risks..............................................................................................................................29
Environmental risks.........................................................................................................................30
Conclusion...........................................................................................................................................31
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Company Introduction
BATA Pakistan is a prominent player in the footwear industry and operates as a public
limited company. Its roots trace back to the global Bata Shoe Organization, established in
1894. The core focus of Bata Pakistan Limited lies in the manufacturing and sale of various
types of footwear, complemented by the retail of accessories and hosiery items.
Since its establishment, the company has consistently upheld a commendable reputation for
producing top-quality footwear catering to diverse consumer segments. Not only has it
maintained high manufacturing standards, but it has also demonstrated agility in designing
shoes that align with dynamic fashion trends.
Bata Pakistan extends its services to valued customers through a robust retail network,
boasting over 500 retail outlets across the country. Additionally, the company collaborates
with 200 registered wholesale dealers, operates from 10 sales offices, partners with 9
distributors, and engages with 5 wholesalers, contributing to a comprehensive and
widespread market presence. This expansive network underlines Bata Pakistan's commitment
to efficiently reach and serve its customer base throughout the nation.
Bata Pakistan Limited is formally incorporated as a public limited company within the
Pakistani jurisdiction. Notably, the company's parent entity is Bafin B.V. (Nederland), while
the ultimate parent company is Compass Limited, based in Bermuda. This corporate structure
reflects the global reach and organizational hierarchy within the Bata Shoe Organization.

History
Bata was founded by Tomas Bata in Zlin, Czechoslovakia. It has since evolved into one of
the world's largest and most recognized footwear manufacturers. The company has a long and
storied history of innovation and commitment to providing quality footwear for consumers
across the globe. Bata opened its first store in Pakistan in 1942, incorporated in Pakistan as
Bata Shoe Company (Pakistan) Limited in 1951, and went public to become Bata Pakistan
Limited in the year 1979. Since then, it has become a prominent name in the country's
footwear industry.

Vision
“ To grow as a dynamic, innovative and market driven domestic manufacturer and
distributor, with footwear as our core business, while maintaining a commitment to the
country, culture and environment in which we operate ”
The vision highlights a comprehensive approach, integrating business growth, innovation,
and responsible corporate citizenship. With a focus on agility and responsiveness to market
trends, the company aims to excel in producing high-quality footwear. Emphasizing local
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manufacturing, Bata Pakistan is committed to contributing to the country's economic

development while respecting its culture and environment.

Mission
“ To be successful as the most dynamic, flexible and market responsive
organization, with footwear as its core business ”
Bata Pakistan's mission statement emphasizes the aspiration to achieve success as the most
dynamic, flexible, and market-responsive organization, with a primary focus on footwear.
The use of terms like "dynamic" and "flexible" underscores the company's commitment to
adaptability and agility in navigating a rapidly changing market. By positioning footwear as
the core business, Bata Pakistan signals a strategic dedication to excelling in its primary area
of expertise. Overall, the mission statement reflects a keen emphasis on staying attuned to
market dynamics and maintaining a nimble and responsive organizational structure,
suggesting a commitment to sustained success in the competitive footwear industry.

Operations

Manufacturing Supply Chain Quality Distribution Retail Marketing and Customer

Facilities Management Control Centers Network Sales Service

Bata Pakistan, a subsidiary of the global Bata Shoe Organization, has a comprehensive operational
footprint that encompasses various aspects of the footwear industry within the country. The
company's operations can be detailed as follows:
Manufacturing Facilities: Bata Pakistan operates manufacturing facilities where it produces a
diverse range of footwear products. These facilities are equipped with advanced machinery and
employ skilled labor to ensure the high-quality production of formal shoes, casual footwear, sports
shoes, sandals, and other types of footwear.
Supply Chain Management: The company manages an extensive supply chain, sourcing raw
materials such as leather, rubber, and other components from local and international suppliers. It
oversees the procurement and transportation of these materials to its manufacturing facilities, ensuring
a seamless production process.
Quality Control: Bata Pakistan places a strong emphasis on quality control throughout its
manufacturing operations. The company implements stringent quality assurance measures to maintain
high standards and ensure that its footwear products meet customer expectations.
Distribution Centers: Bata Pakistan operates distribution centers strategically located across the
country to manage the storage, inventory, and distribution of its footwear products. These facilities
serve as key hubs for managing the flow of goods to retail outlets and wholesale customers.
Retail Network: The company has an extensive retail network that includes company-owned stores,
franchise outlets, and authorized resellers. These retail outlets are spread across urban and rural areas,
providing consumers with access to a wide range of Bata footwear products.
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Marketing and Sales: Bata Pakistan's operations include marketing and sales activities aimed at
promoting its products and engaging with customers. The company employs various marketing
strategies to create brand awareness and drive sales, leveraging both traditional and digital channels.
Customer Service: Bata Pakistan is committed to providing excellent customer service, offering
after-sales support, and ensuring customer satisfaction. This includes addressing customer inquiries,
handling product returns, and maintaining a strong focus on customer feedback.
Overall, Bata Pakistan's operations encompass the entire value chain of the footwear industry, from
manufacturing and supply chain management to retail distribution, marketing, and customer service.
The company's commitment to quality, innovation, and customer satisfaction underscores its position
as a leading player in the Pakistani footwear market.

Brands, Products & Services

Men:

Categories Accessories Brands

 Sneakers  Bags  North Star
 Formal  Belts  Red Label
 Casual  Wallets  Power
 Comfort  Socks  Bata Comfit
 Sandals  Shoe Care  Weinbrenner
 Peshawari  Skechers
 Slippers  Ambassador
 Loungewear  Bata
 Ortho fit
 Hush Puppies
 Mocassino
 Tommy Takkies

Women:

Categories Accessories Brands

 Sneakers  Bags  Bata Comfit
 Comfort  Socks  Red Label
 Party Wear  Power
 Casual  North Star
 Pumps  Marie Claire
 Loungewear  Skechers
 Scholl
 Prive
 Leena
 Bata 3D
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 Bata
 Mocassino
 Island

Kids:

Categories Accessories Brands

 Sneakers  Socks  Bubble Gummers
 Back to School  School Bags  Floats
 Casual  B-First
 Weinbrenner
 Mocassino
 Bata
 Sparx
 Justice League

Overview of Strategic Planning Process

The strategic planning process is a systematic and comprehensive approach that organizations
use to define their direction, make decisions on allocating resources, and set priorities to
achieve their long-term goals. The process involves a series of steps designed to align an
organization's internal capabilities with external opportunities and challenges. Here is an
overview of the typical strategic planning process:
Mission and Vision Statement:
Mission: Establish the organization's purpose, defining what it seeks to accomplish and for
whom.
Vision: Envision the future state of the organization, providing a long-term perspective and a
sense of direction.
Environmental Analysis:
SWOT Analysis (Strengths, Weaknesses, Opportunities, Threats): Evaluate internal strengths
and weaknesses, as well as external opportunities and threats, to understand the organization's
position in its environment.
Setting Objectives:
Define specific, measurable, achievable, relevant, and time-bound (SMART) objectives that
align with the organization's mission and vision. Objectives serve as the targets to be
achieved.
Strategy Formulation:
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Develop strategies to achieve the defined objectives. This involves considering alternative
courses of action and selecting the most appropriate ones based on the organization's
capabilities and the external environment.
Strategy Implementation:
Translate strategies into action plans. Allocate resources, assign responsibilities, and design
organizational structures and processes to execute the chosen strategies effectively.
Performance Measurement and Monitoring:
Establish key performance indicators (KPIs) and other metrics to measure progress toward
objectives. Regularly monitor and evaluate performance against these benchmarks.
Feedback and Adaptation:
Collect feedback from the implementation phase and the monitoring of performance. Use this
information to make adjustments to the strategy or the implementation process as needed.
Strategic Review and Update:
Conduct periodic reviews of the strategic plan to ensure its continued relevance and
alignment with the organization's goals and the external environment. Update the plan as
necessary to address changes in the business landscape.
Communication and Alignment:
Ensure that the strategic plan is communicated effectively throughout the organization. Align
employees, departments, and stakeholders with the overall strategic direction.
Integration with Operational Plans:
Integrate the strategic plan with operational plans and budgets to ensure that day-to-day
activities support the achievement of strategic objectives. The strategic planning process is
not a one-time event but a continuous cycle, allowing organizations to adapt to evolving
circumstances and remain agile in the pursuit of their long-term vision.
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Description & Comparison of Various Strategic Planning Models

SWOT Analysis

 Established Brand 
 Use of Market Analytics  Limited Variety in Trendy &

S  Diverse Product Range Stylish Footwear



Extensive Retail Presence
Quality & Durability W  Less Advertisement &
Promotional Activities
 Declining Market Share
 Pricing Pressures
 Trendy Footwear
 Sustainable Practices  Duplicate/Counterfeit Product

O  Un-Tapped Baluch, Northern

& other rural market of
T


Intense Competition
Economic Instability &
Pakistan Political
 Promotions. Sponsors,
Collaboration, Brand
Partnerships

Strength:

 Established Brand
Bata Pakistan Ltd is a well established and recognised footwear brand in Pakistan
with a history dating back more than half a century. One can confidently say that
almost every household of Pakistan has at least once bought a pair of shoe from Bata.
This long term market presence has offered significant advantage in the management
of economic and political instability within the country.
 Use of Market Analytics
Marketing strategy development relies on the current market situation. Bata
consistently employs market analytics to shape its marketing strategies. The
company's marketing and strategic management practices demonstrate effectiveness
and proficiency.
 Diverse Product Range
BATA offers a diverse range of footwear, catering to all ages and genders, under one
roof serving various preferences. Specifically it has been targeting the customer base
which cannot afford the product with style and good quality through its cost
leadership strategy. This has been key to success for Bata in the past to become choice
of every school going kid. Now through related diversification, it has relatively
enlarged its product portfolio to cater the other segment of the footwear market.
 Extensive Retail Presence
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BATA has a strong retail network with over 500 retail outlets, 200 registered
wholesale dealers, 10 sales offices, 9 distributors & 5 wholesalers across the country,
making its products easily accessible to a large consumer base.
 Quality & Durability
Bata in Pakistan is recognized for its commitment to product quality, ensuring
durability and customer satisfaction under relatively affordable prices.
Weakness:

 Limited Variety in Stylish & Trendy Footwear

Bata offers limited variety in stylish and trendy footwear due to less focus on present
trends. Rapid shifts in fashion trends are a challenge for Bata to stay aligned with
consumer preferences and maintain relevance.
 Less Advertisement & Promotional Activities
Bata’s advertisements and promotional activities are comparatively less than other
brands. We have seen that Bata used to have sales promotions every other month but
now, they have sales only on special occasions.
 Declining Market Share
Bata has been exposed to strong competition with the passage of time. This does not
allow Bata to have a high market share. The market share of Bata has been reduced to
significantly due to other international competitive brands and local brands.
 Pricing Pressures
Because of price sensitivity in the market, Bata faces challenges in setting premium
prices, impacting profit
Opportunity

 Trendy Footwear
The evolving preferences of customers have shifted towards fashionable and newly
designed shoes, creating an opportunity for innovation in the footwear industry.
Unlike the traditional emphasis on old-fashioned and simple shoes, there's a growing
trend in favour of stylish and trendy footwear. Bata, historically known for addressing
the entire family's needs, is now recognising the importance of incorporating
fashionable footwear into their offerings. This shift aligns with the changing market
dynamics and consumer demands observed in brands like Stylo, which emphasises a
diverse range, including bridal and trendy footwear.
 Sustainable Practices
Embracing sustainable practices and eco-friendly materials aligns with the growing
consumer demand for environmentally conscious products. Bata can take advantage
by adopting sustainable practices and manufacturing its products with recycled
materials.
 Un-Tapped Baluch, Northern & Other Rural Markets of Pakistan
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Bata has undoubtedly one of the largest retail network in Pakistan. However, most of
its retail outlets are situated in developed cities and towns. There’s untapped potential
in Baluch and Northern Pakistan yet to be explored. Most of the population there
earns relatively lower income as compared with the people living in developed cities
of Pakistan, therefore, Bata with its experience in cost leadership, could exploit the
opportunity.
 Promotions, Sponsors, Collaborations
Marketing strategies counts as significant factor for a brand to increase its market
share. For sone reasons, bata has disappeared from the tv screens and successful
promotions and brand campaigns. There are a lot of opportunities for Bata if it
explores different market tactics to gain recognition. It can take its part in Pakistan’s
biggest events by sponsoring the events, such as PSL.
Threat

 Counterfeit Products
The footwear industry faces susceptibility to product imitation, whereby duplicate
products not only diminish sales but also exert a detrimental impact on the brand's
identity. Thus the presence of counterfeit products in the market poses a threat to
Bata’s brand integrity and revenue.
 Intense Competition
The footwear industry of the Pakistan is highly competitive due to the presence of
many good quality and affordable manufacturing brands. Apart from the
manufacturing brands, local afghani footwear market along with Chinese imported
footwear, imported used footwear from west, and online home based businesses,
which offers even cheaper price has grabbed a notable market share in the market.
This is a major threat for brands like Bata to remain profitable while providing with
the good quality in affordable prices which competes with the local market.
 Economic & Political Instability
Fluctuations in the economy has impacted consumer spending, consequently,
affecting Bata’s sales and financial performance. Not only does it affects the
consumer spending, but also the high interest and exchange rates has minimised the
Bata’s profit margins, as it has caused increase in finance cost for the company along
with the expensive imported raw material for manufacturing.

PESTEL Analysis
Political:
Political factors are those which are directly controlled by Government and political parties.
These factors influence directly company’s strategies and policies. In Pakistan, political
instability & rapid changes of governments poses a significant threat, impacting the
company's growth and requiring constant strategy adaptation. Terrorism remains a critical
issue in Pakistan, posing hurdles for industrial growth. Simultaneously, the energy crisis
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contributes to higher production costs, impacting profit margins and potentially leading to
downsizing. On a positive note, the government's focus on developing industry safety
regulations aims to provide crucial support and enhance stability in the sector. Bata Pakistan
must navigate these challenges proactively to ensure sustained success in the dynamic
Pakistani market.
Economic
Economic factors play a vital role in shaping the business landscape, and financial
institutions, for example, the State Bank of Pakistan, wield significant influence over
economic stability and provide essential financial aid during crises. Bata's global economic
perspective, stemming from its operations in various countries, allows the company to glean
up insights from diverse markets, which in turn, helps in addressing economic changes
effectively. However, in the specific context of Pakistan, economic conditions pose serious
challenges for overall business environment. Rising inflation rates and a depreciating
currency diminish the buying power of consumers, impacting demand for companies like
Bata. Currency fluctuations have introduce uncertainties, affecting profitability and
potentially raising costs or reducing returns, posing a clear threat to the company.
The high-interest rate environment, approximately 23 %, is among the world's highest, posing
challenges for Bata and other industries to conduct economic activities smoothly.
Nevertheless, one advantageous aspect for Bata in Pakistan is the country's lowest industrial
labor costs, coupled with minimal labor laws. This presents an opportunity for Bata to
capitalise on cost-effectiveness, emphasising the importance of strategic management in
navigating through the current complex economic landscape.
Social
Social and cultural factors significantly influence business dynamics, considering that each
country has distinct norms and values shaping its culture. A notable trend is the increasing
health consciousness among people, leading to a growing interest in workouts and sports. To
address diverse needs and demands arising from this trend, Bata has expanded its product
range to include a variety of footwear, including a comprehensive collection of female sports
shoes under the brand Power. Recognising the evolving dynamics of female participation in
games and athletics, Bata's strategic move aligns with the changing preferences and activities
of its target audience. This adaptability to social trends enhances Bata's ability to cater to
different market segments effectively. However, a challenge for Bata lies in brand awareness
in rural areas. To overcome this, leveraging strong media support for brand awareness
campaigns becomes crucial. Such initiatives can play a pivotal role in influencing the
decisions of individuals in rural areas, ensuring that Bata's diverse product offerings reach a
broader audience and align with their evolving preferences.
Technological
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In the contemporary business landscape, technology stands as a formidable tool for gaining a
competitive edge, and Bata actively tries to positions itself as a leader in the technological
arena. Operating globally in over 80 countries, Bata leverages its extensive experience and
resources for robust research and development initiatives. According to a department head,
the company's growth foundation lies in a profound understanding of economic stimuli,
customer needs, and the capability to translate them into cutting-edge offerings through
leading R&D efforts.
Bata's strong R&D department focuses on key areas such as production, processes, and
materials. Additionally, the emphasis on solid waste utilisation reflects the company's
commitment to creating a pollution-free work environment. A noteworthy goal in Bata's
technological strategy is automation. The global trend sees companies transitioning from
labor-intensive to automated plants, aligning with the broader industry shift towards
efficiency and innovation. Bata's pursuit of automation underscores its commitment to
staying at the forefront of technological advancements in the footwear industry.
Environmental
Environmental factors encompass the impact of environmental issues on a business. For
instance, regulations related to emissions, waste disposal, and sustainability practices. The
importance lies in the increasing awareness of environmental issues and the need for
businesses to adopt sustainable practices to mitigate their impact.
This consumer awareness and global concern for the environment has created a demand for
sustainable and eco-friendly products. Bata can capitalize on this by adopting
environmentally friendly practices and introducing articles with recycled raw materials. This
will help Bata with revising from its old & boring school shoe brand image to a trendy and
cool stylish smart brand. It will also result in increased profit margins for the company. Apart
from this, Bata faces scrutiny over its carbon footprint and environmental impact, therefore,
necessitating measures to reduce environmental harm.
Legal
Legal factors involve the influence of laws and regulations on business operations.
Compliance with legal requirements is crucial for avoiding legal issues and maintaining a
positive corporate image. Legal factors can include labor laws, health and safety regulations,
and industry-specific regulations. This the reason why adherence to laws such as labor laws
and regulations is essential for Bata. It will help in ensuring with the fair treatment of
employees and compliance with labor standards. Furthermore, laws related to intellectual
property are also important to comply with. Protecting trademarks and intellectual property
rights is crucial for Bata to maintain its brand integrity and prevent counterfeiting, and also
avoiding to do the same.
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PORTER’S Five Forces Model

Porter's Five Forces model is a strategic framework developed by Michael Porter to analyse
the competitive forces within an industry. The model helps businesses assess the
attractiveness and competitiveness of a specific market or industry.
1. Threat of New Entrants
Moderate: The footwear industry requires substantial capital investment, established
distribution networks, and brand recognition. Bata’s long-standing presence and strong brand
create barriers for new entrants. However there are no such regulations which would make it
difficult for someone to enter in the market. But the cost of doing business in Pakistan is
high, therefore threat of new entrant is moderate.
2. Bargaining Power of Buyers
Moderate: While Bata has a diverse product range, customers may have moderate
bargaining power due to the availability of alternatives and price sensitivity. However, brand
loyalty and perceived quality can offset some of this power.
3. Bargaining Power of Suppliers
Moderate: Bata relies on suppliers for raw materials like leather and rubber. The bargaining
power is moderate as there are alternative suppliers, but the quality and reliability of
materials may impact negotiations. Since Bata is a global player, therefore it manages
sourcing of the raw material, but due to exchange rate fluctuations, it faces difficulties in
keeping it profit margins intact.
4. Threat of Substitute Products:
Moderate: The threat of substitutes exists, especially with changing fashion trends.
However, Bata's diverse product portfolio and brand reputation mitigate this threat to some
extent.
5. Intensity of Competitive Rivalry:
High: The Pakistani footwear market is highly competitive with several local and
international players. Intense rivalry requires continuous innovation, marketing efforts, and
strategic positioning to maintain market share, which Bata is trying, but has not found ground
breaking success in it yet.
Overall, Bata Pakistan Ltd faces a moderately challenging environment, with established
brand strength acting as a significant advantage. Managing supplier relationships, addressing
changing consumer preferences, and sustaining competitive differentiation are critical for
long-term success in this industry.
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BCG Matrix

Stars
The products which generate enough amount of revenues for the firm to be deemed as
profitable yet have the chances of expanding further are termed as Stars. Star product can
later on become a leading source of profitability for the firm when the market reaches
maturity, and no further increase in market share is expected.
Bata has moved beyond its regular school shoes images, and create a position as a brand that
offers contemporary shoes and accessories. Marie Claire is one addition to the Bata product
range which is a rising star. The shoes and handbags under the brand Marie Claire are
designed for women who seek footwear and accessories that are suitable for their
professional lifestyle.
Cash Cows
The cash cows are the main source of financial stability for an organization. These products
have created a stronghold in the market and were able to establish a high demand among the
consumers. The school shoes being manufactured by the company are a cash cow for Bata as
the industry has matured over the years, and the demand for the school shoes has gradually
increased. The market share of Bata in the school shoes category is also stable, which has led
to the conclusion that school shoes are a main source of earning for Bata.
Question Mark
In the product portfolio being managed by an organization, some products have lower
profitability as compared to cash cows and stars. In addition to the weaker financial return
yield by these products, the future progress of the products termed as a question mark is
marked by uncertainty. If the market conditions are favorable and products are able to
generate a high market share, it can become a star product. Shoe care products such as shoe
 P a g e | 15

shiner, brushes and polish have not been able to create a significant position in the market.
The management can invest in these products as there is scope for further growth. The leather
shoe cream for instance, target the customer who purchased leather shoes, this pairing can
help in driving up the sales in this domain, making this product move out of the category.
Dog
The products that are continuously underperforming, despite the investment and marketing
initiatives taken by the company are regarded as dogs. These products are not likely to
experience any significant improvement as the market conditions are not favorable, and the
industry doesn’t have any noticeable capacity for growth. In the category of accessories,
socks and shoelaces manufactured by Bata have achieved very low sales. As a result, the
company has to reconsider its investment decision in this category, by shifting the investment
to more profitable units and decreasing the focus on socks and shoelaces.

Bata Pakistan – Internal Analysis

Introduction to Internal Analysis:
Internal analysis is a crucial component of strategic management that involves assessing an
organization's internal resources, capabilities, and competencies. It aims to identify strengths
and weaknesses within the organization, which can help in formulating effective strategies to
achieve competitive advantage and organizational objectives. Internal analysis provides
insights into the company's operational efficiency, resource utilization, and core
competencies, enabling decision-makers to leverage internal strengths and address
weaknesses proactively.
Role of Internal Analysis in Assessing Organizational Capabilities:
Internal analysis plays a vital role in assessing organizational capabilities by examining the
following aspects:

 Resource Identification: Internal analysis helps identify the organization's tangible

and intangible resources, including financial assets, human capital, technology, and
brand reputation. Understanding these resources allows management to leverage them
effectively to achieve strategic objectives.
 Core Competency Identification: Internal analysis helps identify core competencies
—unique strengths or capabilities that give the organization a competitive advantage
in the marketplace. Recognizing core competencies enables the organization to focus
resources and efforts on areas where it excels, leading to sustained competitive
advantage.
 Value Chain Analysis: Value chain analysis examines the sequence of activities
involved in delivering a product or service to customers and identifies opportunities
for cost reduction, differentiation, and value creation. By analyzing each step in the
value chain, organizations can optimize processes, enhance efficiency, and improve
overall performance.
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 SWOT Analysis: Internal analysis is often integrated with external analysis through
SWOT analysis (Strengths, Weaknesses, Opportunities, Threats). By evaluating
internal strengths and weaknesses alongside external opportunities and threats,
organizations can develop strategies that capitalize on strengths, mitigate weaknesses,
exploit opportunities, and counter threats.

Internal Analysis of Bata Pakistan:

Value Chain Analysis:

O u tb o u n d M a rk etin g
In b o u n d L o g istics O p era tio n s S erv ices
L o g ictics a n d S a les

 Inbound Logistics: Bata Pakistan sources raw materials, including leather, rubber,
and synthetic materials, from suppliers worldwide. Efficient procurement processes
ensure timely delivery and quality control of materials.

 Operations: Bata Pakistan's manufacturing facilities focus on producing high-quality

footwear using advanced technology and skilled labor. Continuous process
improvement initiatives enhance operational efficiency and product quality.

 Outbound Logistics: Bata Pakistan distributes its products through a vast network of
retail stores, franchise outlets, and online channels. Efficient logistics and distribution
ensure timely delivery and customer satisfaction.

 Marketing and Sales: Bata Pakistan employs various marketing strategies, including
advertising campaigns, promotions, and celebrity endorsements, to enhance brand
visibility and attract customers. Strong retail presence and customer service drive
sales and brand loyalty.

 Service: Bata Pakistan emphasizes customer satisfaction through after-sales service,

warranty support, and product exchanges. Feedback mechanisms enable continuous
improvement in service quality and customer experience.
Core Competencies Identification

 Brand Reputation: Bata Pakistan has built a strong brand reputation over decades,
known for quality, affordability, and reliability in footwear.

 Extensive Retail Network: Bata Pakistan's extensive retail network and distribution
channels provide a significant competitive advantage, ensuring widespread
availability of its products.

 Product Innovation: Bata Pakistan continuously invests in product innovation and

design, offering a diverse range of footwear to meet evolving customer preference
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 Operational Efficiency: Bata Pakistan's efficient manufacturing processes and

supply chain management contribute to cost-effectiveness and operational excellence

 Human Capital: Bata Pakistan values its skilled workforce, fostering a culture of
employee development and engagement, which enhances productivity and
performance

Competitor Analysis

Borjan Hush Puppies Unze

Starlet Ndure

1.
Borjan:
Strengths: Borjan offers a diverse range of stylish footwear catering to various
demographics. The brand is known for its trendy designs and competitive pricing.
Weaknesses: May lack the extensive global presence and brand recognition compared to
Bata Pakistan.
Opportunities: Expand retail footprint and product offerings to capture a larger market
share.
Threats: Intense competition from both domestic and international footwear brands,
changing consumer preferences.
2. Hush Puppies:
Strengths: Hush Puppies is renowned for its comfortable and durable footwear, especially in
the casual and formal segments. The brand has a strong international presence and brand
reputation.
Weaknesses: Higher price points may limit accessibility to certain consumer segments.
Opportunities: Enhance marketing efforts to target a broader audience, introduce more
affordable product lines.
Threats: Competition from other established brands in the comfort footwear segment,
potential economic downturn impacting discretionary spending.
3. Ndure:
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Strengths: Ndure focuses on offering trendy and affordable footwear options, particularly
appealing to younger demographics. The brand often collaborates with influencers and
utilizes social media for marketing.
Weaknesses: Limited brand recognition compared to more established competitors like Bata
Pakistan.
Opportunities: Expand distribution channels to reach a wider audience, diversify product
range to include more premium offerings.
Threats: Increasing competition from fast-fashion brands, evolving consumer preferences for
sustainability and ethical production.
4. Unze:
Strengths: Unze specializes in fashionable and affordable footwear for men, women, and
children. The brand offers a wide variety of styles and frequently updates its collections.
Weaknesses: Limited brand visibility outside specific consumer segments or regions.
Opportunities: Enhance brand awareness through targeted marketing campaigns, expand
online presence to reach a broader customer base.
Threats: Competition from both domestic and international brands, economic instability
affecting consumer spending habits.
5. Starlet:
Strengths: Starlet focuses on providing trendy and affordable footwear options, particularly
targeting young adults and fashion-conscious consumers.
Weaknesses: Limited brand recognition compared to more established competitors like Bata
Pakistan or Hush Puppies.
Opportunities: Invest in branding and marketing efforts to increase visibility and attract new
customers, expand product range to cater to diverse preferences.
Threats: Competition from both local and international brands, changing fashion trends
impacting consumer demand.
Market Share Analysis:
Bata Pakistan likely holds a significant market share due to its longstanding presence,
extensive retail network, and diverse product offerings. Competitors such as Hush Puppies
and Borjan may have considerable market shares in their respective segments, particularly in
the mid-range and fashion footwear categories. Ndure, Unze, and Starlet compete more
directly with Bata Pakistan in the affordable and trendy footwear segments, each carving out
its share of the market based on brand positioning and product differentiation
Strategic Group Mapping
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Bata Pakistan likely occupies a central position, catering to a broad customer base with a mix
of style, quality, and affordability, while each competitor may have a unique strategic focus
within the footwear market. Certainly, let's delve deeper into strategic group mapping for
Bata Pakistan and its competitors:

Bata Financials
Liquidity Ratios
RATIOS FORMULA CALCULATIONS
2022 2021 2020 2019 2018
Current Ratio Current Assets / Current Liabilities 1.429 1.637 1.958 2.141 2.939

Quick Ratio (Current Assets - Inventory)/ Current Liabilities 0.701 0.952 1.233 1.203 1.638

Working Capital Current Assets - Current Liabilities 3009496 3698388 3719444 4933974 5918583

Cash Ratio (Cash and Cash Equivalents) / Current Liabilities 0.37 0.55 0.64 0.29 0.51

These are four key liquidity ratios of Bata over a five-year period from 2018 to 2022. These
ratios are used to evaluate a company's ability to pay off its short-term obligations with its
short-term assets. Here's an interpretation of each ratio:
1. Current Ratio: This ratio compares current assets to current liabilities. A ratio above
1 indicates that the company has more current assets than current liabilities, which is
generally seen as positive. However, the current ratio has been decreasing over the
five-year period, from 2.939 in 2018 to 1.429 in 2022. This suggests that the
company's liquidity position is weakening, and it may be becoming less capable of
covering short-term obligations with its current assets.
2. Quick Ratio: Also known as the acid-test ratio, this ratio excludes inventory from
current assets and then compares the remainder to current liabilities. It's a stricter
measure of liquidity because inventory can be less liquid than other current assets.
The quick ratio has also been decreasing, from 1.638 in 2018 to 0.701 in 2022. This
trend indicates that the company's immediate liquidity, excluding inventory, is
declining, which could be a concern for meeting short-term liabilities without relying
on the sale of inventory.
3. Working Capital: This is the absolute dollar amount difference between current
assets and current liabilities. Positive working capital suggests that a company can
cover its short-term liabilities with its short-term assets. The working capital has
fluctuated over the years, with a notable decrease from 2018 to 2022. This decrease in
working capital could indicate tighter liquidity and potentially more challenges in
managing short-term obligations.
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4. Cash Ratio: This ratio measures the company's ability to pay off its current liabilities
with only cash and cash equivalents, which are the most liquid assets. A higher ratio
indicates a stronger position to cover short-term debts. The cash ratio has been quite
volatile, with the highest value in 2020 at 0.64 and the lowest in 2019 at 0.29. The
ratio in 2022 is 0.37, which is lower than in 2020 and 2021, suggesting that the
company's most liquid assets have decreased in proportion to its current liabilities.

Overall, the trend in these ratios indicates that Bata's liquidity position has been weakening
over the past five years. The company has less coverage for its short-term liabilities in terms
of current assets, quick assets, and cash. This could potentially make it more difficult for the
company to meet its short-term financial obligations, especially if it faces unexpected
expenses or downturns in business.
Asset Composition
RATIOS FORMULA CALCULATIONS
2022 2021 2020 2019 2018
Inventory Turnover COGS/ Average Inventory 2.01 2.21 2.14 2.38 2.49

AP Turnover Credit Purchases / Average AP 2.10 2.19 2.67 3.80 4.74

AR Turnover Credit Sales/ Average AR 19.69 11.85 5.85 7.28 9.00

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These are three asset composition ratios for a company named Bata over a five-year period
from 2018 to 2022. These ratios are used to evaluate how efficiently a company manages its
assets. Here's an interpretation of each ratio:
1. Inventory Turnover: This ratio measures how many times a company's inventory is
sold and replaced over a period. It is calculated by dividing the cost of goods sold
(COGS) by the average inventory. A higher ratio indicates more efficient
management of inventory. The inventory turnover ratio for Bata has been decreasing
from 2.49 in 2018 to 2.01 in 2022, suggesting that the company is selling and
replacing its inventory less frequently. This could indicate slower sales or
overstocking of inventory.
2. AP Turnover: Accounts Payable (AP) Turnover measures how quickly a company
pays off its suppliers. It is calculated by dividing credit purchases by the average
accounts payable. A higher ratio indicates that the company is paying its suppliers
more quickly. Bata's AP turnover ratio has decreased from 4.74 in 2018 to 2.10 in
2022, indicating that the company is taking longer to pay its suppliers. This could be a
strategic move to manage cash flow or a sign of cash flow difficulties.
3. AR Turnover: Accounts Receivable (AR) Turnover measures how quickly a
company collects payments from its customers. It is calculated by dividing credit
sales by the average accounts receivable. A higher ratio indicates more efficient
collection of receivables. Bata's AR turnover ratio has increased significantly from
9.00 in 2018 to 19.69 in 2022. This suggests that the company has become much more
efficient at collecting payments from its customers, which is a positive sign for cash
flow. The trends in these ratios suggest that Bata has become more efficient in
collecting receivables from customers but is taking longer to turn over its inventory
and to pay its suppliers. The improved AR turnover is a positive development, but the
decreased inventory turnover could be a concern if it reflects slowing sales. The
slower AP turnover might help with short-term cash flow management but could
potentially strain relationships with suppliers if extended too far.
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Debt Ratios
RATIOS Formula CALCULATIONS
2022 2021 2020 2019 2018
Total Debt to Total Capital Debt/( Debt+ Shareholders Equity) 0.65 0.61 0.54 0.53 0.30

Total Debt to Equity Capital Total Debt/ Total Shareholders Equity 1.88 1.53 1.20 1.13 0.43

Long term Debt to Equity Capital Long Term Debt/ Total Shareholders Equity 0.64 0.59 0.27 0.26 0.01

Short term Debt to Equity Capital Short Term Debt/ Total Shareholders Equity 0.12 0.94 0.28 0.27 0.29

Interest Coverage Ratio EBIT/ Interest Expense 2.88 2.12 -0.13 2.90 54.90

These are five debt ratios of Bata over a five-year period from 2018 to 2022. These ratios are
used to evaluate a company's financial leverage and its ability to meet its debt obligations.
Here's an interpretation of each ratio:

 Total Debt to Total Capital: This ratio measures the proportion of a company's
capital that comes from debt. A lower ratio indicates a greater proportion of equity
financing relative to debt, which is generally considered less risky. Bata's ratio has
been increasing from 0.30 in 2018 to 0.65 in 2022, indicating that the company has
been financing more of its operations through debt over the years.

 Total Debt to Equity Capital: This ratio compares the total debt of a company to its
shareholders' equity. A higher ratio suggests that a company is using more debt to
finance its assets relative to equity. Bata's total debt to equity ratio has increased
significantly from 0.43 in 2018 to 1.88 in 2022, suggesting that the company has
become more leveraged and reliant on debt financing.

 Long-term Debt to Equity Capital: This ratio focuses on long-term debt as a

proportion of shareholders' equity. An increasing ratio indicates a higher reliance on
long-term debt. Bata's long-term debt to equity ratio has increased from 0.01 in 2018
to 0.64 in 2022, showing a substantial increase in the use of long-term debt financing.
 P a g e | 23

 Short-term Debt to Equity Capital: This ratio measures the proportion of short-term
debt relative to shareholders' equity. An increasing ratio indicates a higher reliance on
short-term borrowing. Bata's short-term debt to equity ratio has decreased from 0.29
in 2018 to 0.12 in 2022, suggesting that the company has reduced its reliance on
short-term debt.

 Interest Coverage Ratio: This ratio measures a company's ability to pay interest on
its outstanding debt with its earnings before interest and taxes (EBIT). A higher ratio
indicates a stronger ability to cover interest expenses. Bata's interest coverage ratio
has fluctuated, with an exceptionally high value of 54.90 in 2018, which then
decreased to more typical levels of around 2.88 in 2022. The ratio in 2022 suggests
that the company is still able to cover its interest expenses, but not as comfortably as
in 2018.
The trends in these ratios indicate that Bata has been increasing its use of debt, particularly
long-term debt, relative to its equity over the past five years. The reduction in short-term debt

relative to equity is a positive sign, as it may indicate improved liquidity or a strategic shift in
the company's capital structure.
The company's ability to cover interest expenses remains adequate, the increased leverage
could pose higher financial risk, especially if earnings are volatile or if interest rates rise.
 P a g e | 24

Profitability Ratios

RATIOS FORMULA CALCULATIONS

2022 2021 2020 2019 2018
Gross Profit Margin (Revenue - COGS) / Revenue 0.48 0.46 0.37 0.45 0.45

Operating Profit Margin Operating Profit / Revenue 0.12 0.11 -0.01 0.13 0.14

Net Profit Margin Net Profit / Revenue 0.05 0.04 0.05 0.06 0.09

Return on Assets Net Profit / Average Total Assets 0.05 0.04 0.04 0.08 0.15

Return on Equity Net Profit / Average Shareholders' Equity 0.15 0.09 0.09 0.15 0.21

EPS Net Income/ Weighted average no of shares 115.75 71.80 82.98 144.03 198.60

Here's an interpretation of each ratio and the trend over the years:

 Gross Profit Margin: This ratio indicates the percentage of revenue that exceeds the
cost of goods sold (COGS). It reflects the efficiency of production as well as the
pricing strategy. The company's gross profit margin has fluctuated, with a low in 2020
(0.37) and a recovery in 2022 (0.48), suggesting an improvement in cost management
or pricing.

 Operating Profit Margin: This shows the percentage of revenue that remains after
all operating expenses are deducted. It's a measure of the company's operational
efficiency. The company had a negative operating profit margin in 2020 (-0.01),
indicating that operating costs exceeded revenue, but it has since improved to 0.12 in
2022.

 Net Profit Margin: This ratio measures the percentage of revenue that remains as net
profit after all expenses, including taxes and interest, are paid. The company's net
profit margin has decreased from 0.09 in 2018 to 0.05 in 2022, suggesting that net
profitability has declined relative to revenue.

 Return on Assets (ROA): ROA indicates how effectively the company is using its
assets to generate profit. The trend shows a significant decline from 0.15 in 2018 to
0.05 in 2022, which could imply that the company's asset utilization has become less
efficient.

 Return on Equity (ROE): This ratio measures the profitability relative to

shareholders' equity. The ROE has seen a decline from 0.21 in 2018 to 0.15 in 2022,
indicating that the return on shareholders' investment has decreased.
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 Earnings Per Share (EPS): EPS is the portion of a company's profit allocated to
each outstanding share of common stock. The EPS has been volatile, with a high in
2018 (198.60) and a significant drop in 2021 (71.80), followed by a recovery in 2022
(115.75). This suggests inconsistency in the company's profitability from the
perspective of shareholders.

Overall, the company appears to have faced challenges in 2020, as reflected by negative or
lower ratios, but has shown signs of recovery in 2021 and 2022. However, when compared to
2018, the company's profitability in 2022 has not fully returned to those levels, particularly in
terms of ROA, ROE, and EPS.

Risk Assessment and Proposed Strategies

Economic and political
Bata Pakistan, as a multinational company operating in Pakistan, is subject to various
economic and political risks that can impact its business operations. Some of the key risks
include:
Economic Risks:

 Exchange Rate Fluctuations: Bata Pakistan may face risks associated with exchange
rate fluctuations, which can affect its import costs and pricing strategies.

 Inflation: High inflation rates in Pakistan can increase operating costs for Bata
Pakistan, impacting its profit margins.

 Economic Instability: Political unrest or economic instability in Pakistan can lead to a

decline in consumer spending and overall market demand for Bata's products.
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Political Risks:

 Policy Changes: Changes in government policies, regulations, or trade agreements can

impact Bata Pakistan's operations, supply chain, and profitability.

 Political Instability: Political instability, civil unrest, or changes in government

leadership can disrupt business operations and pose a risk to the safety of Bata's
employees and assets.

 Corruption: Bata Pakistan may face challenges related to corruption, bribery, and
unethical business practices, which can impact its operations and reputation.
Proposed Strategies
To mitigate economic and political risks, Bata Pakistan should diversify its supply chain to
reduce dependence on a single region, implement currency risk management strategies, and
build strong government relations to stay informed about policy changes. Conducting
thorough economic and political risk assessments, establishing local partnerships, considering
market diversification, and continuously monitoring developments will also enhance the
company's resilience to economic and political risks.
Supply chain risks
Raw Material Sourcing: Dependence on specific suppliers for raw materials can pose a risk,
especially if there are issues with quality, availability, or disruptions in the supply chain.

 Transportation and Logistics: Challenges in transportation, such as delays,

disruptions, or increased costs, can impact the timely delivery of products to Bata's
retail outlets and customers.

 Inventory Management: Inaccurate demand forecasting or unexpected changes in

consumer preferences can lead to excess inventory or stockouts, affecting Bata's
operational efficiency and financial performance.

 Supplier Relationships: Risks related to the financial stability, ethical practices, or

labor conditions of suppliers can impact Bata's reputation and supply chain resilience.

 Regulatory Compliance: Changes in trade regulations, customs procedures, or

import/export requirements can impact Bata Pakistan's supply chain operations and
increase compliance-related risks.
Proposed Strategies
To address these risks, Bata Pakistan can implement strategies such as diversifying its
supplier base, maintaining buffer stock, investing in supply chain visibility and technology,
and fostering strong supplier relationships. Additionally, conducting regular risk assessments
and developing contingency plans can help mitigate potential disruptions in the supply chain.
Regulatory risks
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Compliance with Labor Laws: Bata Pakistan must ensure compliance with local labor laws
and regulations, including those related to wages, working hours, and workplace safety.

 Trade Regulations: Changes in trade policies, tariffs, or import/export regulations can

impact Bata Pakistan's international sourcing and distribution activities, potentially
leading to increased costs or supply chain disruptions.

 Product Standards and Labeling: Adherence to product quality standards, labeling

requirements, and consumer safety regulations is crucial for Bata Pakistan to avoid
regulatory penalties and maintain consumer trust.

 Environmental Regulations: Compliance with environmental protection laws, waste

management regulations, and sustainable manufacturing practices is essential for Bata
Pakistan to mitigate environmental risks and maintain its social license to operate.

 Taxation and Financial Regulations: Changes in tax laws, financial reporting

requirements, or currency exchange regulations can impact Bata Pakistan's financial
performance and strategic decision-making.
Proposed Strategies
To manage regulatory risks, Bata Pakistan should stay informed about evolving regulations,
engage in proactive dialogue with regulatory authorities, and maintain robust internal
compliance processes. Additionally, conducting regular compliance audits and investing in
legal counsel can help mitigate the impact of regulatory changes on the company's
operations.
Security risks

 Physical Security: Bata Pakistan faces physical security risks related to the safety and
protection of its retail outlets, warehouses, and corporate facilities. These locations are
susceptible to threats such as theft, vandalism, and unauthorized access, which can
endanger the safety of employees, customers, and assets. Implementing robust
physical security measures, including surveillance systems, access controls, and
security personnel, is crucial to mitigate these risks and ensure a secure environment
for all stakeholders.

 Cybersecurity: The increasing reliance on digital infrastructure exposes Bata Pakistan

to cybersecurity risks, including cyber attacks, data breaches, and other information
security incidents. These threats can compromise sensitive customer data, disrupt
business operations, and damage the company's reputation. To address these risks,
Bata Pakistan needs to invest in cybersecurity measures such as firewalls, encryption,
regular security audits, employee training on cybersecurity best practices, and incident
response plans to effectively detect, prevent, and respond to cyber threats.

 Employee Safety: Ensuring the safety and well-being of employees is paramount for
Bata Pakistan. This includes safeguarding employees from potential security threats
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within the workplace, especially in high-risk areas or during periods of civil unrest.
Providing comprehensive safety training, establishing emergency response protocols,
and maintaining open channels of communication to report security concerns are
essential to mitigate employee safety risks.

 Supply Chain Security: Bata Pakistan's supply chain is vulnerable to security risks,
including theft, counterfeiting, and transportation-related security incidents. These
risks can disrupt the flow of goods, compromise product integrity, and lead to
financial losses. Implementing supply chain security measures such as secure
transportation practices, supplier vetting procedures, and inventory tracking systems
can help mitigate these risks and ensure the integrity and security of the supply chain.
Proposed Strategies
To address these security risks comprehensively, Bata Pakistan should conduct regular
security assessments, develop and enforce security policies and procedures, and foster a
culture of vigilance and awareness among employees. Additionally, collaborating with
external security experts and law enforcement agencies can provide valuable insights and
support in mitigating security risks.
Brand and reputation risks
Brand and reputation risks are significant considerations for Bata Pakistan, as they can impact
consumer trust, market position, and overall business performance. Here's an overview of
brand and reputation risks specific to Bata Pakistan:

 Product Quality and Safety: Any issues related to the quality or safety of Bata
Pakistan's products can significantly damage its brand reputation. Incidents such as
product defects, safety recalls, or quality control failures can erode consumer trust and
lead to negative publicity.

 Customer Service and Experience: Poor customer service, dissatisfaction with product
quality, or negative experiences at Bata Pakistan's retail outlets can result in negative
word-of-mouth, social media backlash, and damage to the brand's reputation.

 Corporate Social Responsibility: Bata Pakistan's commitment to ethical business

practices, sustainability, and social responsibility is integral to its brand reputation.
Failure to uphold these values or involvement in controversies related to labor
practices, environmental impact, or community engagement can tarnish the brand's
image.

 Public Relations and Crisis Management: Inadequate response to public relations

crises, security incidents, or negative publicity can lead to long-term damage to Bata
Pakistan's brand reputation. Effective crisis management and transparent
communication are essential to mitigate these risks.
 P a g e | 29

 Competitive Landscape: Intense competition within the footwear and retail industry in
Pakistan poses a risk to Bata Pakistan's brand reputation. Failure to differentiate its
brand, respond to market trends, or maintain a competitive edge can impact its market
position and brand perception.
Proposed Strategies
To address these brand and reputation risks, Bata Pakistan should prioritize product quality
and safety, invest in customer service training and experience enhancement, actively engage
in corporate social responsibility initiatives, and develop robust crisis management and public
relations strategies. Building a strong brand identity, fostering customer loyalty, and
maintaining transparent communication with stakeholders are essential components of
mitigating brand and reputation risks for Bata Pakistan.
Competition Risks
Competition risks are a significant concern for Bata Pakistan, given the dynamic nature of the
footwear and retail industry. Here's an overview of competition risks specific to Bata
Pakistan:

 Market Saturation and Pricing Pressure: Bata Pakistan faces competition from both
domestic and international footwear brands, leading to market saturation and intense
pricing pressure. Competitors offering similar products at lower prices can impact
Bata Pakistan's market share and profitability.

 Product Differentiation: In a crowded marketplace, the ability to differentiate its

products and brand from competitors is crucial for Bata Pakistan. Failure to innovate,
offer unique designs, or meet evolving consumer preferences can result in losing
market relevance and competitive advantage.

 E-commerce and Online Retail: The growth of e-commerce and online retail
platforms presents a competitive risk to Bata Pakistan's traditional brick-and-mortar
business model. Competing effectively in the digital space, optimizing online sales
channels, and providing a seamless omnichannel experience are essential to mitigate
this risk.

 Brand Perception and Positioning: Competitors' marketing strategies, brand

positioning, and market perception can impact Bata Pakistan's competitive standing.
Maintaining a strong brand image, effective marketing campaigns, and strategic brand
positioning are critical to staying competitive in the market.

 New Entrants and Disruptive Innovations: The entry of new competitors or disruptive
innovations in the footwear and retail industry can pose a risk to Bata Pakistan's
market share and industry standing. Keeping abreast of emerging trends, technologies,
and consumer preferences is essential to adapt to changing market dynamics and
mitigate the risk of being overtaken by new entrants or innovative disruptors.
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Proposed strategies
To address these competition risks, Bata Pakistan should focus on product innovation, brand
differentiation, pricing strategies, and customer engagement. Additionally, leveraging digital
technologies, enhancing the online retail presence, and continuously monitoring the
competitive landscape are essential to stay ahead in the market. Collaborating with industry
experts, conducting market research, and staying agile in responding to market shifts are key
strategies to mitigate competition risks for Bata Pakistan.
Technology risks
Technology risks are a critical consideration for Bata Pakistan, particularly in the context of
its operations, customer engagement, and data security. Here's an overview of technology
risks specific to Bata Pakistan:

 Cybersecurity Threats: Bata Pakistan faces the risk of cyberattacks, data breaches, and
ransomware incidents that can compromise sensitive customer information, financial
data, and internal systems. Such security breaches can result in financial losses,
reputational damage, and legal repercussions.

 Data Privacy and Compliance: With the increasing focus on data privacy regulations
such as GDPR and local data protection laws, Bata Pakistan must ensure compliance
with data privacy requirements. Mishandling of customer data, non-compliance with
privacy regulations, or data security lapses can lead to regulatory fines and loss of
customer trust.

 E-commerce and Online Transactions: As Bata Pakistan expands its online retail
presence, it faces technology risks related to secure online transactions, payment
processing, and protection of customer financial information. Any vulnerabilities in
the e-commerce platform can lead to fraud, unauthorized access, and financial losses.

 IT Infrastructure and System Reliability: Reliance on technology for inventory

management, supply chain operations, and customer relationship management
exposes Bata Pakistan to risks related to system downtime, IT infrastructure failures,
and operational disruptions. These risks can impact business continuity and customer
satisfaction.

 Digital Transformation Challenges: Embracing digital transformation initiatives, such

as implementing new technologies, cloud-based systems, and data analytics,
introduces risks related to integration complexities, technology adoption hurdles, and
managing change within the organization.
Proposed Strategies
To address these technology risks, Bata Pakistan should prioritize cybersecurity measures,
including robust firewalls, encryption, and intrusion detection systems. Implementing strict
data privacy protocols, conducting regular security audits, and investing in employee training
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on cybersecurity best practices are essential. Additionally, ensuring the reliability of IT

infrastructure, adopting secure e-commerce platforms, and partnering with trusted technology
vendors can help mitigate technology risks. Continuous monitoring of technology trends,
proactive risk assessments, and a culture of vigilance regarding technology security are
crucial for managing technology risks effectively at Bata Pakistan.
Environmental risks
Environmental risks are a growing concern for businesses, including Bata Pakistan, as they
face increasing scrutiny regarding their impact on the environment. Here are some
environmental risks specific to Bata Pakistan:

 Raw Material Sourcing: Bata Pakistan relies on various raw materials, including
leather, rubber, and synthetic materials, for its footwear production. Environmental
risks arise from potential resource scarcity, unsustainable sourcing practices, and the
environmental impact of raw material extraction.

 Waste Management and Pollution: The footwear manufacturing process generates

waste, including chemical by-products, water usage, and solid waste. Inadequate
waste management practices can lead to pollution of air, water, and soil, potentially
resulting in environmental damage and regulatory non-compliance.

 Energy Consumption: Bata Pakistan's operations, including manufacturing facilities

and retail outlets, consume significant energy. Risks related to energy consumption
include carbon emissions, reliance on non-renewable energy sources, and exposure to
energy price volatility.

 Climate Change Resilience: Climate change poses risks to Bata Pakistan's supply
chain, infrastructure, and operations. Extreme weather events, changes in temperature,
and shifting climate patterns can disrupt production, logistics, and distribution,
impacting business continuity and financial performance.

 Regulatory Compliance: Compliance with environmental regulations and standards,

such as air and water quality regulations, waste management guidelines, and carbon
emissions reporting, is essential. Non-compliance can lead to legal penalties,
reputational damage, and operational disruptions.
Proposed strategies
To address these environmental risks, Bata Pakistan should consider implementing
sustainable sourcing practices, promoting eco-friendly materials, and adopting
environmentally responsible manufacturing processes. Implementing waste reduction and
recycling initiatives, investing in energy-efficient technologies, and exploring renewable
energy sources can help mitigate environmental risks. Additionally, Bata Pakistan can engage
in environmental impact assessments, collaborate with suppliers on sustainability initiatives,
and stay informed about evolving environmental regulations to ensure compliance.
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Demonstrating a commitment to environmental stewardship, transparency in reporting

environmental impact, and engaging in sustainable business practices can help Bata Pakistan
manage environmental risks effectively.

Conclusion
Bata Pakistan Limited is a significant player in Pakistan's footwear industry, known for its
long history of producing and selling top-quality footwear, along with accessories and
hosiery items. As a subsidiary of Bafin B.V. within the global Bata Shoe Organization, Bata
Pakistan has established itself as a leader in the market with over 500 retail outlets spread
across the country. The company's operations are guided by a commitment to innovation,
market responsiveness, and responsible corporate citizenship. One of Bata Pakistan's core
challenges lies in staying abreast of rapidly evolving fashion trends while facing stiff
competition in the footwear market. However, the company has successfully navigated these
challenges by leveraging its extensive market presence and employing a cost leadership
strategy. By targeting customer segments with limited purchasing power, Bata Pakistan has
managed to maintain its market position and appeal, particularly among school-going
children, for whom it is often the preferred choice.
To address these challenges and capitalize on opportunities, Bata Pakistan employs a
comprehensive strategic planning process. This process involves setting Specific,
Measurable, Achievable, Relevant, and Time-bound (SMART) objectives aligned with the
company's mission and vision. These objectives serve as targets to be achieved, guiding the
development of strategies and action plans. Resources are allocated, responsibilities assigned,
and organizational structures and processes designed to execute these strategies effectively.
Bata Pakistan's operational footprint encompasses various aspects of the footwear industry,
including manufacturing facilities, supply chain management, quality control, distribution
centers, retail networks, marketing, and customer service. The company operates advanced
manufacturing facilities equipped with state-of-the-art machinery and skilled labor to ensure
the production of high-quality footwear across various categories, such as formal shoes,
casual footwear, sports shoes, and sandals.
In managing its supply chain, Bata Pakistan sources raw materials, including leather and
rubber, from both local and international suppliers. The company oversees the procurement
and transportation of these materials to its manufacturing facilities, ensuring a seamless
production process. Quality control is a top priority for Bata Pakistan, with stringent
measures implemented throughout its manufacturing operations to maintain high standards
and meet customer expectations. Bata Pakistan operates strategically located distribution
centers across the country to manage storage, inventory, and distribution of its footwear
products. These distribution centers serve as key hubs for managing the flow of goods to
retail outlets and wholesale customers. The company's extensive retail network includes
company-owned stores, franchise outlets, and authorized resellers, enabling it to reach a
broad customer base nationwide.
In terms of marketing and sales, Bata Pakistan employs data-driven strategies to promote its
products and engage with customers effectively. However, the company faces challenges in
keeping up with rapidly changing fashion trends and maintaining relevance in the market. To
 P a g e | 33

address these challenges, Bata Pakistan can explore opportunities for innovation in the
footwear industry, embrace sustainable practices, and adopt eco-friendly materials in its
manufacturing processes.
Despite its strengths and opportunities, Bata Pakistan also faces several risks, including
economic and political instability, competition, cybersecurity threats, supply chain security
issues, and environmental concerns. To mitigate these risks, the company must stay
proactive, diversify its supply chain, comply with regulations, invest in cybersecurity
measures, and adopt sustainable business practices. In summary, Bata Pakistan's success lies
in its ability to effectively navigate challenges, capitalize on opportunities, and maintain its
market position through strategic planning, operational excellence, and adaptability to
changing market dynamics.
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Appendix (1