Updated Lijjat

8/8/2019 Updated Lijjat

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Group member

o Sunmit Jain

o Jovin

o Kirti Shirke

o Namrata Patel

o Nilekha Sawant

o Sonali Ahire

o Switej Lopes


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Why name is Shri Mahila Griha

Udyog Lijjat?Mahila means woman

Griha means home

Udyog means industry

Lijjat means tasty


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INTRODUCTION

o Shri Mahila Griha Udyog Lijjat,popularly known as

Lijjat

o Primarily cottage industry, urban by origin

o Members round 42000 women and 69 branch across

the country (2009)

oAnnual turnover of Rs. 417 corers

o Registered under the KVIC Act- (Khadi & Village

Industries Commission)


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Objectives

o It is a voluntary organization of sisters

o The organization is neither for the poor sisters nor for therich ones-poor Sisters should remove the thoughts of

poverty from should their mind and the rich sisters removethoughts of their affluence

o It believes in running the business wisely and with practicegood business ethics with dealers and consumers


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o The organization is like a family and sisters run it as if

they all belong to the same family.

o No one can change these basic thoughts of theorganization.

o It never accepts charity or grant


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Three Golden Rules

o All the rights of the institution must belong to members

only.

oThere must be maintenance of Lijjat quality at any

costs.

o There must be clean and time bound accounting

system.


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History

o On 15 March 1959, seven semi-literate women initiated a venture toearn additional income through better use of their idle time inGirgaum, Mumbai with papad production.

o After initial share of challenges the venture started growing Number

rose 7 to 25 within 3 months and 300 member at the end of 1961o In 1962 name Lijjat for its product suggested by Dhirajben Ruparel.

o By 1962-63, sales grew to Rs. 1.8 lakhs

o Functioned first seven years( 1959 -1966 ) as an unregistered

organization . In 1966, institution registered under Societies

Registration Act 1860.o In 1966-67, Lijjat was registered by Khadi and Village Industries

Commission(KVIC) as a unit belonging to Processing of Cereals and

pulses industry group under KVIC Act.

o Grant ofWorking Capital of Rs. 8 lakhs and tax exemptions


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o First branch outside Maharashtra opened in 1968

o In 1987, registered office shifted at Bandra.

o In 1988,Lijjat entered in soap market with SASA product

having 17% of total turnover.

o In 1980s and 1990s attracted attention of foreign visitors

o Annual export accounted in 2001 is more than US $2.4 millions

o In 2002, It employed 42,000 people in 62 division all overIndia

o Lijjat marks 50th year of existence on 15 March ,2009.


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Founders

o Seven women with no special skills but a strongdetermination to earn dignity as individuals

o Jaswantiben Jamnadas Popat

o

Parvatiben Ramdas Thodanio Ujamben Narandas Kundalia

o Banuben N. Tanna

o Laguben Amritlal Gokani

o Jayaben V. Vithalani


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Core values

o An organization of the women, by the women and for the

women

o Pledge to ensure that all get the fruits of labour, no harm is

caused to the institution ando Synthesis of 3 different concepts

o The concept of Business

o Production of quality goods at reasonable prices

o

The concept of familyo Mutual family affection, concern and trust

o The concept of Devotion

o Work is worship


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"Who owns Lijjat?"

o That member-sisters were competent to take a

decision for their own

o It was not open for an outside agency to interfere

with the internal working of Lijjat

o Lijjat believes in the philosophy of sarvodaya and

collective ownership. It accepts all its working

members as the owners and an equal partaker inboth profit and loss.


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Organization Structure


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Four Ps


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Products

o Papad (Five flavors: Lasan, Moong, Mirch, Punjabi and Urad)

o Khakra

o Appalam

o Masala

o Vadio Gehu Atta (Wheat flour)

o Bakery products

o Chapati

o SASA Detergent Powder

o SASA Detergent Cake (Tikia)o SASA Nilam Detergent Powder

o SASA Liquid Detergent


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Pricing

oAdopts a Cost Plus Pricing Strategy

oAllows them to market their products extensively

oTargeted at the middle and lower segments of society

oSale of Papad amounts to about 45% of total sales of lijjat


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Price Consumer price list

Items Udad with

Pepper

Udad with

Garlic &

Chillies

Udad with Red

Chillies

Moong (50%

Udad & 50%

Moong)

Udad Special Moong

Special(50%

Udad & 50%

Moong)

Punjabi Masala

Special

Small Size 100

gms

17.00 17.00 17.00 17.00 21.50 21.50 21.50

mini size 200

gms

30.00 30.00 30.00 30.00 33.00 33.00 33.00

small size 200

gms

34.00 34.00 34.00 34.00 39.00 39.00 39.00

Big size 250

gms

45.00 45.00 45.00 45.00 50.00 50.00 50.00

Small / Big

size 500 gms

70.00 70.00 70.00 70.00 79.00 79.00 79.00

Small / Big

size 1 kg.

105.00 105.00 105.00 105.00 140.00 140.00 140.00

Small / Big

Size 2.5 kg.

250.00 250.00 250.00 250.00 320.00 320.00 320.00


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Price Export price listItems 80 Pkts X 200 gms BigSize & SmallSize( 7in & 5in) in one

carton rate per packet

Udad with pepper 30

Udad with Garlic & Green Chillie 30

Udad with Green Chillie 30

Udad with Red Chillie 30

Udad with Plain Udad 30

Udad Jeera 30

(50%Udad + 50%Moong) 30

Moong with Pepper-(50%Udad + 50%Moong) 30

Udad Special 35

Moong Special-(50%Udad & 50% Moong) 35

Punjabi Masala Special 35

Udad Sindhi Masala Special 35

Mathia Special 35

Dhamta Special 35


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Place

oBranches in seventeen Indian states.

oWell settled in Maharashtra and Gujarat.

oExports accounts for Rs 170 million, merchant exports

oMajor countries are UK, USA, Australia and European

Countries.


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Promotion

o Believed that best

promotion will be word

of mouth

o Concentrated more on

cost effectiveness andquality

o Used both electronic and

print media

oAlso sites like

amazon.com and ebay

are advertising

o Motivation factors for

distributors


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Advertising

o The vernacular newspapers,television and radio.

o The money for

advertisements was spent

by the PolypropyleneDivision, which recovered

the same by adding it to the

price of the bags that it

supplied to all the branches

and divisions throughoutIndia


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Advertising

o Brand is having the strengthof Consistently Good

Quality as its USP.

o Communicated its

Crispness and qualitythrough ads.

oAds features a Bunny

( mascot) and jingle

Khurram Kharram.

oAired on specific regionalchannels e.g. Alpha Gujrati,

Sun etc


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Quality Check

o The papads are prepared in different parts ofIndia, thequality of the water used usually varies, and so can thequality of final product


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To preventoLijjat has its own laboratory in Mumbai, wherethe final products are tested and coded.o monthly meetings-the quality issue &modifications.

oSurprise visits to ensure hygienic conditionsoHead office procures and supplies the rawmaterialsoNew branch - neighboring branch helps it by

guiding and training new members.


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oSuccessive failures of a branch -reduces the daily

wages of its members by 1 rupee

o

Members also rewarded for extra effortRajkot members in 2002 received Rs. 4000 as bonusSeveral issues of Lijjat Patrika enumerate the names of

the member-sisters


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Divisions

Flour Division (Vashi) Masala Division and Quality Control Laboratory (Cotton Green) Printing Division (Cotton Green) Advertising Division, Bandra

Khakra Division, (Buhari, Valod district) Chapati Divisions atWadala, Borivali, Mulund and Kandivali Polypropylene set-up (Kashi-mira Road) Vadi factory (Valod) Bakery Division (Valod)

Detergent Powder and Cakes manufacturing unit (Dahisar) andoffice (Borivali)


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How system works?

oThe entire cycle starts with a simple recruitment

process.

oAny woman

adopt the institution's values

respect for quality.


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oTo involve in rolling of the papads

Clean house

space to dry the papads.

oThose who do not have this facility

kneading dough

packagingtesting for quality.


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Distribution Flow Chart


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oIngredients purchased and distributed by the

Central Office to maintain the quality.

oProcurement of Ingredients:Urad dal from Myanmar

Asafetida from Iran

Black Pepper from Kerala


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oPacked papads are sealed into a box (13.6kg).

oProduction from each centre is transported tothe depot for that area.

oMumbaio16 branches, 6 depotso400 boxes- (Nearby 3-4 branches)


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oIn some smaller towns or villages, the branch itself serves asthe depot.

oThe depots

storage areaspick up points for distributors

o Mumbai.32 distributors

of 100 boxes/day from the depot

o Selection of distributor


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How Goods Reach

oIf there is demand in a particular place,they open a newbranch,Jammu and Kashmir.

o

For example, they do not have any centre in Goa,but they have appointed adistributor for that area toensure that Lijjat papads reach Goa.

oThey communicate with distributorso

monthly meetings - discuss their problems,quality, price,reach, etc.


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Collection Flow Chart


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The Growth

o Membership has expanded from an initial number of7 sisters to 42,000 sisters throughout India.

o The organisation is wide-spread, with it's CentralOffice at Mumbai and it's 69 Branches and 37Divisions in different states all overIndia.

o The venture started with loan of Rs 80. Lijjats annual

sales increased from Rs 6,196 in 1959 to more than Rs4.7 billion in 2009, with exports itself exceeding Rs.170 million.


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Profit Generationo Profit generation is considered essential as that is what

makes the organization self sustainable

o Lijjat is register under KHADI & VILLAGE

INDUSTRIES COMMISSION.

o Less number of administrative staff per centre to reduce

expenses

o Own network of suppliers as the product range does not

give credit to the retailers


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Financials

o The accumulated profits of the Lijjat enterprise standat Rs. 60 crores

o The annual profit for the year are Rs. 170 million .

This was achieved on an annual turnover in 2008-09of Rs. 4.7 billion.

o Sale of Papad amounts to about

45% of total sales of lijjat.sasa amount to about 17% of total

sales. Masala and khakra amount to

19%.

liijat papad

sasa

Masala

Khakra

other


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Financials

o The Sisters Savings Fund is also available to the each of theLijjat branches, to tide over short-term cash deficits, in case ofnecessity

o Marketing is on a strictly cash-and-carry basis, allowing forfunds to be continuously recycled

o On the whole, labour charges work out to about 20-25 per centof the total cost, with raw materials consuming 55-60 per centand sales and other administrative expenses making up the

remaining 20 per cent


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Exports

o Lijjats exports alone account for Rs 17crs (Rs 170 million)

o Not directly involved in exporting, but recognised professionalmerchant exporters (who also export other food products) placean export order

o Export production is of the same quality as daily production.

o At present, 30 per cent to 35 per cent of the production of LijjatPapad is being exported, mainly to countries like the United

States, the United Kingdom, the Middle East, Singapore,HongKong and Holland.


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Business is the Motto

o Run and perceived as a serious business, not a charityorganisation.

o There is no place for feelings of pity, sympathy orcharity among members.

o Also do not accept donation or charity of any kind, evenif voluntarily offered.

o This has helped the organisation retain independenceand brought quick growth.

o It has given clear vision of the path of progress.

o Maintaining proper accounts has always been on ouragenda

o Every branch closes the account book every day


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Business Transparency

o Each branch office is responsible for setting atarget for monthly production and themarketing

o

Each Lijjat centre has a clearly delineatedmarketing territory to avoid competitionamongst centres

o Commission agents are attached to almost allLijjat Centres and they account for a major partof the Lijjat sales

o Lijjat has a separate marketing, sales, andadvertising divisions

o Same prices across the category


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Flexibility

o The decentralised production methodology hasensured that the women do not have to leave theirhomes for work

o It allows them flexible working schedule enabling

them to discharge other household responsibilitieso This account for the easy acceptance of the work

among such a large number of women since theyfeel their economic activity will not disrupt thefamily by their absence

o

Men are also less hostile to women working athome for extra income than travelling to aworkplace

o Self selection of work by the members


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SWOTAnalysis


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Strengths

o Sincere Hard work

o Development of woman by providing them a living /

Employment.

o Maintaining the same standard over the last 50 years.

o Having a unique status in the country.


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Weakness

o lack of marketing skills

o Less use of technology

oLimited capital

oSemi-literate

.


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Opportunities

o Expanding horizontally as well as vertically

o Increasing export

o Business can be made sustainable/profitable

without high initial investment


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Threats

o In the Papad industry, the major competition or threat

is posed to the institution by Ganesh Papad

o In the spices industry, the Haldiram and MDH are the

major competitors

o In detergent, there are many competitors like HUL,P

&G etc.


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Awards to lijjat

o Best Village Industry for the period 1998-1999 to

2000-2001 from Commission of Khadi & Village

Industries

o A Businesswomen of the

Year 2001-2002 for

Corporate Excellence

From The Economic Times


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Awards to lijjat

o In January 2003 it received

the award for Best Village

From the hands of Honble

FormerPrime Minister

Shri Atal Bihari Vajpayee

oOn 21st December 2005

institution has received

the Brand Equity

Award from the handsFormer Honble President

of India, DR.A.P.J Abdul kalam


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Social Welfare

Literacy campaign Akshardeep started in 1999for its members in Bhubhaneshwar

After the 2001 Gujarat earthquake, all the branches ofLijjat gave a total donation of more than Rs 4.8

million, including Rs 1 million from the central office

Literacy programmes in other states

Guidance on further studies

Educational and hobby centres for rural women Free computer training to sisters children

Loans and housing assistance


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Summing it up

o Lijjat provides economic opportunities through adomestic activity

o The merging of ownership with membership hasencouraged uniform and sustained organizationalgrowth

o The consistent quality of the product has been aprimary factor in establishing and maintainingLijjats brand image in the market for the last fourdecades

o The Sarvodaya philosophy proved vital in formingLijjats foundation

o Transparency in operations and a nonhierarchicalstructure has helped in establishing organizationalaccountability among member sisters


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THANK YOU.

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