E MERCK (INDIA)-Improved Product Mix

EPW Research Foundation BATA INDIA Walking Tall Again AFTER going deep into the red during the year ended December 31, 1995 with a net loss of Rs 42.2 crore, Bata India has managed to do a complete about face during 1996 by posting a positive bottomline of Rs 4.2 crore. The company claims that this has been possible mainly due to restructuring of its business activities and a turnaround strategy which included focus on mass consumption products, flexible marketing, tighter cost controls, and better asset management. Earlier, the company had decided to wean away from traditional strongholds in the middle and lower footwear segment to woo the premium segment a strategy which backfired resulting in the huge loss last year. In order to cut its losses, the company then sold off its corporate headquarters for Rs 19.5 crore; the sale proceeds helping it to tide over its severe cash crunch. Next, it discontinued its tie-up with Adidas and once again reverted its focus from the low-volume, high priced niche-markets to the high-volume, middle and lower priced segment.