Footwear major Bata doesn’t expect demand to normalise before 2021 as it gradually opens up its manufacturing units and retail stores .
The company is adapting itself to the change in the nature of footwear demand and is evaluating the closure of unprofitable stores.
With the gradual easing of lockdown, the company has opened around 1,100 of its 1,400 retail stores but store timings are variable and footfall is minimal.
“The rest of the stores are not open because either they are in containment zones or in malls and some states have not allowed malls and stores to open yet. Moreover, only about 250 stores are actually open for a significant time of the day for six days a week. The demand is slow, but it is slowly ramping up. We are seeing small increase week to week but it is still significantly lower than pre Covid-19 period,” said Sandeep Kataria, CEO of Bata India.
“The good news is that all our plants, including Batanagar, have opened. As we went into the Covid-19 scenario with stock in our hand, that stock is there and the requirement for the factory to produce is only limited,” he said.
The company has also seen a variation in demand with some segments like school, office and festive wear not in major demand. The company has also started making washable shoes, offering disinfectant sprays and accepting orders through digital means for home delivery.
“The demand is varied across categories. Demand for chappals, sandals, sports shoes, sneakers is high. Those are the ones we have asked the factories to start with. It is the shoes which people wear to office or to a social occasion which is currently in lesser demand. This is school season and that being delayed has affected demand,” Kataria said.
He added that demand will come to normal only next year. But the company may see a marginal increase in sales during the festive season later this year.
Bata is also evaluating the closure of around 50-100 stores keeping in mind the business situation. “We may need to close a few stores and that is a reality of the business. The stores which will not be profitable in the next 6-12 months, we have to take action,” Kataria said.