Bata is planning a new retail strategy. It plans to close down its smaller stores and open larger retail outlets. I had a chance to talk with Deepak Deshpande, VP (Retail), Bata India earlier this month. – KM
Bata has emerged into a brand from a retailing company. So what is your take?
We are more retail focus than we were in past. And retail revolution has helped a lot in this. Manufacturing, making products and knowing what the retailers and the consumer wants. If we would have then in the past it would have been different but today retailers are deciding what is to be manufactured and what is to be sold.
With the revolution in the retail, you r going to have a situation in the market, where getting product would not be a challenge s it used to be in the past. But putting the right product in the right place has to be the thing that needs to be taken into consideration. Today for example if u wants a range of shirt, you know the local shirt manufacturer, and then through the chain of networks, you can have an access to all the manufacturers and retailers in the world. So the trick is not how to get manufactured, but in selecting what is that you want and what message you want to convey. The merchant in the business are going to be concentrated.
Bata is a brand which is more concentrated into tier-2 cities, now that u r planning to expand and close down smaller retail chains, what is going to be your strategy for tier-II and tier-III cities?
It’s not like that, if I have a store in tier-II or tier-III city, I am planning to open a 2,000 sq ft store there itself, along with that store. I am not abandoning the market. Tell me where or in which city or market you don’t find a Bata store. We will continue to expand and we want to increase the size of our foot brand. The amount of retail acquisitions which are planning to have is more than what the market is doing in particular segment.
Retail is suffering in west and while India still continues to hold. Indian consumers are still confident?
There are two things that drive a market. One is the unsaturated market demand. And two is per capital consumption. Earlier what has happened is that earlier products were not available, incomes were limited, but today both the things has increased. And the third which is happening simultaneously is branding is coming in. Today there is premium branding and tomorrow affordable branding will come in and third is even hypermarkets are branding themselves in USA. Branding is the thing which is going to happen on a long term basis.
What about malls? How many stores you are planning to open in malls?
Yes, we are planning to have stores in malls. It is definitely for the brand presence but at the same time we don’t want our stores in malls to make money for the landlords and not for the company.
What about the Hush Puppies stores?
They are going to be the sand alone stores. And are going to be present in very very selected malls.
Bata is one of the recognized brand names in the country. So definitely we want to reinforce that. Within it, we have our own brands. Within the umbrella of Bata, we would be developing our own brands. Differently, people call them private labels and we call them our own brands.
In terms of manufacturing, how much percentage of products would they out-source and how much would they manufacture?
We are manufacturing around 5-6 kind of products in-house, in our own factories and we are also there in south East Asia and rest is outsourced.
Published in IMAGES Business of Fashionby