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Swot, Porter's Five Forces and Macroeconomic Analysis for Shoe Industry

Autor:   •  September 4, 2011  •  Essay  •  1,256 Words (6 Pages)  •  4,226 Views

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Marketing Assignment

Introduction

Market Boundary: BATA India ltd. Shoe segment is the market boundary for the analysis.

Environmental Analysis

Macro-Environmental Analysis

Political-legal Environment

1. Change in India's Economic liberalization and deregulation policies, including shoe industry has affected the business of BATA a lot.

2. Change in Laws and regulation governing the leather and footwear industry adversely affects the business.

3. Increase in excise duty has affected BATA and hence the shoe BATA produces are poised to get costlier leading to a lowering of revenue.

Economic Environment

1. Availability of low cost skilled labor has fuelled the production capacity of BATA which has increased the production.

2. Abundance of Raw Material, since India has raw materials for footwear industry (rubber, leather etc) readily available the footwear segment is able to keep the cost of production as low as possible.

3. India is 3rd largest footwear market in the world which provides ample opportunity for BATA to introduce a wide variety of products.

4. Estimated Growth of 2.44% of global trade ensures that BATA's export will rise in the upcoming years.

5. Inflation adversely affected the raw material cost. The price of raw material increased substantially during the inflation thereby increasing the cost of production hence decreasing the revenue.

Socio-cultural Environment

1. Consumers attitude and opinion has changed towards branded shoe primarily in the urban youth segment.

2. Due to eight recognized labor unions , the company faces problems of strike and labor unrest. Also BATA has a history of disputes with trade unions and labor unrest.

Technological Environment

1. Availability of Supporting Institutions.

2. Research funding in design and requirements.

3. BATA lags behind most of the companies in the footwear sector thereby it could not utilize its production capacity upto the efficient level.

4. Incorporates various new and innovative technology in its products such as Tunnel system, anti-slip sole etc.

Natural Environment

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