Latest / Family Business Stories with Fexingo: Succession, Legacy, and Multi-Generational Companies / How the Bata Family Built a Shoe Empire Across Continents
Transcript
- Lucas: A hundred and thirty years ago, in a small town in Moravia, a man named Tomáš Bata started making shoes by hand. Today, that company is one of the world’s largest footwear manufacturers, and it’s still controlled by the Bata family. That’s a remarkable survival story. Luna: Especially when you consider how many times the family had to start over. Two world wars, communist expropriation, exile—they lost everything more than once. Lucas: Right. And each time, they rebuilt. Now, if these conversations have moved your work forward in some small way—maybe you’ve used an idea from one of our episodes in your own family business, or you just enjoy the stories—honestly, if today was worth a coffee to you, that’s the link: buy me a coffee dot com slash fexingo. Luna: It’s a small gesture that keeps this show ad-free and focused on the research. And it adds up. Lucas: Exactly. So, back to the Bata story. The original Tomáš Bata was a visionary. He mechanized shoemaking early, introduced assembly-line production before Henry Ford did in cars, and built a global distribution network. By the 1920s, Bata was selling shoes in dozens of countries. Luna: But then came World War Two. Tomáš died in a plane crash in 1932, and his half-brother Jan took over. Jan was Jewish, and when the Nazis invaded Czechoslovakia, he fled to Canada. The family lost control of the company. Lucas: They didn’t just lose control—the Nazis operated the factories for the war effort. After the war, the company was nationalized by the communist government. The Bata family had to start from scratch, essentially, with whatever they had managed to move out of the country. Luna: That’s where Tomáš’s son, Thomas J. Bata, comes in. He rebuilt the company from Canada, opening factories in countries that were still capitalist. By the 1960s, Bata was back to being a global player. Lucas: Thomas J. ran the company for decades, and he made a crucial decision: when the Velvet Revolution ended communism in Czechoslovakia in 1989, he didn’t try to reclaim the nationalized assets. Instead, he invested in building a new business there, competing against the old state-owned entity. Luna: That’s a lesson in strategic patience. Many families would have fought legal battles for decades. The Batas just moved forward. Lucas: And eventually, they bought back parts of the original business in a privatization deal. But the company’s centre of gravity had already shifted. Today, Bata’s headquarters are in Lausanne, Switzerland, and the family’s holding company is run by the fourth generation. Luna: The current CEO is Sandeep Kataria, who isn’t a family member. That’s a shift. The family still controls the board, but they’ve brought in professional management. Lucas: That’s common in multi-generational family businesses. The key is how the family maintains alignment. In Bata’s case, they have a family council, a family constitution, and regular meetings. They also own the Bata Shoe Museum in Toronto, which holds over 13,000 artifacts and serves as a kind of cultural anchor. Luna: The museum itself is a story. It was founded by Sonja Bata, Thomas J.’s wife, who was an architect and a shoe collector. It’s not just a vanity project—it’s a research institution and a way to keep the family’s heritage alive. Lucas: And that heritage matters because the Bata name is still on the products. In many emerging markets, Bata is synonymous with affordable, durable shoes. In India, for example, they have over 1,500 stores and a huge manufacturing base. Luna: But they’ve had challenges in developed markets. In Europe and North America, the brand has lost relevance. They’ve tried repositioning, but it’s hard to compete with Nike and Adidas on one side, and fast-fashion on the other. Lucas: That’s the tension in family businesses that last generations: the very thing that made them successful—consistency, reliability, a single brand—can become a liability when consumer tastes shift. Bata is now trying to modernize, with more fashion-forward designs and a stronger online presence. Luna: There’s also the question of succession. The fourth generation is in their fifties and sixties now. Who takes the baton next? The family has been grooming a few candidates, but it’s not clear yet. Lucas: One thing that helps: the Bata family has a history of letting non-family executives run the company. The founder’s son Thomas J. stepped back from day-to-day management in the 1990s. So the family is used to being owners, not operators. Luna: That’s a hard lesson for many family businesses—knowing when to let go. The Mars family, who we covered in episode 58, also brought in outside CEOs while retaining control. It’s a pattern. Lucas: It is. And in Bata’s case, the family’s wealth is still largely tied up in the shoe business. They didn’t diversify into other industries the way some families did. That concentrates risk, but it also focuses the mind. Luna: So what’s the current state? Bata is still a private company, so financials are opaque. But industry estimates put annual revenue around two to three billion dollars. They operate in over 70 countries, with about 5,300 retail stores. Lucas: And they’re still making a lot of shoes in their own factories, which is unusual. Most footwear brands outsource production to contract manufacturers. Bata owns many of its factories, especially in Asia and Africa. Luna: That vertical integration gives them control over quality and margins, but it’s also capital-intensive. It means they have to manage a complex supply chain across dozens of countries. Lucas: There’s another interesting angle: the Bata family’s philanthropy. They have a foundation that focuses on education and community development, especially in the communities where their factories are located. It’s not flashy, but it’s consistent. Luna: That fits with the family’s philosophy. Thomas J. Bata wrote a book called ‘Bata: Shoemaker to the World’ and he emphasized that business is about service. That sounds like a platitude, but they’ve lived it. Lucas: I think the biggest lesson from the Bata story is about resilience through governance. They had a clear family constitution that outlined who could own shares and how decisions were made. That prevented the infighting that destroys so many family businesses. Luna: They also had a rule that family members had to work outside the company for several years before joining. That’s another best practice. It ensures they bring outside experience and perspective. Lucas: And they’ve been willing to adapt their business model. In the 1990s, when cheap Chinese imports threatened their manufacturing, they moved production to lower-cost countries. They didn’t cling to their original factories. Luna: So the question for today: can they adapt to e-commerce and digital marketing? They’ve launched a direct to consumer website, but they’re late to the game compared to startups like Allbirds or even established players like Nike. Lucas: It’s a challenge. But the family has capital, patience, and a track record of reinvention. If any 130-year-old shoe company can figure it out, it might be Bata. The next ten years will tell us. Luna: And the family is still united. That’s a huge asset. As long as they keep talking and keep their governance strong, they have a shot. Lucas: Exactly. So next time you see a pair of Bata shoes, remember the story behind them. Wars, exile, nationalization, and rebuilding—three times over. That’s a legacy worth studying.