A PROJECT REPORT
ON
SHRI MAHILA GRIHA UDHYOG LIJJAT PAPAD (RECOGIZED BY KHADI & VILLAGE INDUSTRIES COMMISSION)
PRESENTED AND SUBMITTED BY: ROLLNO:
NAME
SONALI AHIRE
2
NAMRATA PATEL
58
NILEKHA SAWANT
70
KIRTI SHIRKE
80
SUNMIT JAIN
98
JOVIN GEORGE
20
SWITEJ LOPES
99 Towards the partial fulfilment of the PRINCIPLES OF MANAGEMENT
POST GRADUATION DIPLOMA IN MANAGMENT (GICED, UNIVERSITY OF MUMBAI) &
SUBMITTED TO Ms. SUSHMITA MUKHERJI (2009-2010) GICED, MUMBAI UNIVERSITY
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ACKOWLEDGEMET: We would like to take opportunity to acknowledge the innumerable guidance and support extended to us by all the group members of project in execution and preparation of our project on the topic of “WOMEN’S CO-OPERATIVE.”
With With immense immense please please we are present presenting ing “Lijjat “Lijjat”” project project report report as part of the curriculum of PGDM. We wish to thank all people who gave us Unending support. In this project, we have given brief description about the organization, which has been started by the women’s organization.
We express our profound thanks to our head of department department Mr . Kshirsagar and our project incharge Miss. Sushmita Mukherji Mukherji and all those who have indirectly guided and helped us in preparation of this project.
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ACKOWLEDGEMET: We would like to take opportunity to acknowledge the innumerable guidance and support extended to us by all the group members of project in execution and preparation of our project on the topic of “WOMEN’S CO-OPERATIVE.”
With With immense immense please please we are present presenting ing “Lijjat “Lijjat”” project project report report as part of the curriculum of PGDM. We wish to thank all people who gave us Unending support. In this project, we have given brief description about the organization, which has been started by the women’s organization.
We express our profound thanks to our head of department department Mr . Kshirsagar and our project incharge Miss. Sushmita Mukherji Mukherji and all those who have indirectly guided and helped us in preparation of this project.
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Table Of contents
Lijjat Introduction
Objectives
Three Golden Rules
History
Founders
Core values
"Who owns Lijjat?"
Organization Structure
4 P’s
Advertising
Packaging
Quality Check
Divisions
The Growth
Profit Generation
Financials
Exports
Business is the Motto
Business Transparency
Flexibility
SWOT Analysis
Awards to lijjat 3|Page
Social Welfare
Conclusion
Why name is Shri Mahila Griha Udyog Lijjat Papad ? •
•
•
Mahila means women: The unique characteristic of the organization is that all members of the organization are female. Griha means home: The raw materials which are used by the membersisters are household so they can do their work from home. Udyog means business: The organization do the business very wisely. They do not do any adulterations or malpractices. It is a pure business.
Lijjat means tasty: Earlier they do not had any name of the organization but after a few years they had decided to give name which is ‘LIJJAT’
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Introduction: Be it an evening snack, or a banquet or a meal at home, The Papad finds its due place on the dining table. of Indian meal is complete without it, and India’s biggest ‘Papad’ success story is Undoubtedly, Lijjat. Everyone enjoys ‘rags to riches’ stories and everyone likes tales of stupendous success achieved through sheer determination. The story of Shri Mahila Griha Udyog Lijjat Papad is all that much more. Shri Mahila Griha Udyog Lijjat Papad, popularly know as “Lijjat”, is an Indian women’s organization manufacturing different Products of village industries. The organization’s registered office is Situated in Mumbai and it has 69 centers and 31 divisions on different states. Lijjat is spread all over Indian. Stared in 1959 with a capital of Rs. 80, Lijjat today has a Annual turnover of around Rs.470 crore (Rs. 4.7 billion), with Rs.24 In exports and has around 42,000employees. Lijjat is primarily a cottage industry, urban by its origin that has spread to the rural areas. It is considered as one of the most remarkable enterprenual initiative by woman that is identified with women empowerment in India. Lijjat shows how an organization can infuse Gandhian simplicity in all its activities. Shri Mahila Griha Udyog Lijjat Papad is registered under The KVIC Act- (Khadi & Village Industries Commission) The Khadi and village Industries Commission (KVIC) is a statutory organization established in 1956 by an Act of parliament. It plays a pivotal role in the strengthening of rural economy by promoting and developing Khadi and village industries. The main objectives of the KVIC include skill improvement. Providing employment in rural areas, and transfer of technology, rural industrialization and promoting self-reliance among the people and to build up a strong rural community base. The functions of the KVIC are generally to plan, promote, organize and assist in implementation of programmers for the development of Khadi and village industries.
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Objectives: When industry starts some basic thoughts or some objectives are there. In cases of cooperatives organization Objectives of that organization became very important to runs Successful business. lijjat also have some Objectives to run their business there are as follows :
It is a voluntary organization of sisters.
The organization is neither for the poor sisters nor for the rich ones-poor Sisters should remove the thoughts of poverty from should their mind and the rich sisters remove thoughts of their affluence.
It never accepts charity or grant.
It believes in running the business wisely and with practice good business ethics with dealers and consumers.
The organization strictly observes the practice of maintaining the the accounts
Regularly, writing the books daily and preparing balance sheets every month.
The organization is like a family and sisters run it as if they all belong to the same family.
The organization is like a revered place of worship.
Of one can change these basic thoughts of the organization.
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Three Golden Rules: Besides basic principles like self-reliance, co-ownership and faith in dignity of labour, the institution has also formed three ‘Golden Rules’ to business lijjat try to follow their three Golden rules at any cost in all branches in all over India
1. All the rights of the institution must belong to members only.
2. There must be maintenance of “Lijjat” quality at any cost.
3. There must be clean and time bound accounting system. All the Lijjat branches follow these three Golden Rules
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HISTORY: On March 15, 1959, they gathered on the terrace of their building and started with the production of 4 packets of Papads. They started selling the papads to a known merchant in Bhuleshwar. From the beginning, the women had decided that they would not approach anyone for donations or help, even if the organization incurred losses. Chaganlal Karamsi Parekh, popularly known as Chaganbapa, became their guide. Initially, the women were making two different qualities of papads, in order to sell the inferior one at a cheaper rate. Chaganbapa advised them to make a standard papad and asked them never to compromise on quality. He emphasized to them the importance of running it as a business enterprise and maintaining proper accounts. In 1962, the name Lijjat (Gujarati for "tasty") was chosen by the group for its products. The name was suggested by Dhirajben Ruparel, was chosen in a contest held for the purpose, with prize money of Rs. 5. The organization was named Shri Mahila Griha Udyog Lijjat Papad. In many Indian languages, Mahila means women, Griha means home, Udyog means industry. By 1962-63, its annual sales of papads touched Rs. 1.82 lakh. In July 1966, Lijjat registered itself as a society under the Societies Registration Act 1860[. In the same month, on Chaganbapa's recommendation, U N Deodhar, the chairman of KVIC personally inspected the Lijjat. KVIC or Khadi Development and Village Industries Commission is a statutory body set up by the Government of India for development of rural industries. In September 1966, KVIC formally recognized Lijjat as a unit belonging to the "processing of cereals and pulses industry group" under the Khadi and Village Industries Act. It was also recognized as a "village industry". In 1966, KVIC granted it a working capital of Rs. 8 lakhs (0.8 million) and was allowed certain tax exemptions The first branch outside Maharashtra was established at Valod, Gujarat in 1968. After tasting tremendous success with their papads, Lijjat began producing other products likekhakhra (1974), masala (1976), vadi, wheat atta, and bakery products (1979). In 1970s, Lijjat set up flour mills(1975), printing division (1977) and polypropylene packing division (1978). The group also initiated some unsuccessful ventures such as cottage leather (1979), matches (1979), and agarbatti s (incense sticks In 1985, the Lijjat branch at Jabalpur was taken over by one Shantilal Shah as his own unit, which he ran with the help of a Sanchalika (branch head), who was wife of his employee. Lijjat went through tremendous pressures and court stay orders to retrieve the situation In 1987, Lijjat purchased new premises at Kamal Apartments in Bandra, a suburb of Mumbai. The registered office shifted to the Bandra with effect from July 1988[7]. In 1988, Lijjat entered the soap market with Sasa detergent and soap[16].. Sasa had annual sales of Rs 8|Page
500 million, accounting for 17 percent of Lijjat's total turnover in 1998. In March 1996, the 50th branch of Lijjat was inaugrated in Mumbai In the 1980s and 1990s, Lijjat started attracted attention of foreign visitors and officials. The Vice-President of Uganda, Dr. Speciosa Wandira-Kasibwe, visited Lijjat's central office in January 1996, since she wanted to start a similar institution in Uganda. Lijjat started exporting its products with the help of merchant importers in the United Kingdom, the United States, the Middle East, Singapore, the Netherlands Thailand, and other countries. Its annual exports accounted for more than US$ 3.2 million in 2009. As its popularity grow, Lijjat started facing the problem of fake Lijjat papads being introduced in the market. In June 2001, three persons were arrested in this connection, in Bihar ]. Lijjat's website explains the identification features of original Lijjat papads In 2009, Lijjat had a turnover of Rs 3.5 billion and exports worth Rs.170 million. It employed 42,000 people in 62 divisions all over the country. The 69nd branch became operational at Jammu and Kashmir in 2002, enrolling over 150 members. Lijjat marks its 50th year of existence on March 15 2009
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Founders: Seven women with no special skills but a strong determination to earn dignity as individuals Jaswantiben Jamnadas Popat Parvatiben Ramdas Thodani Ujamben Narandas Kundalia Banuben N. Tanna Laguben Amritlar Gokani Jayaben V. Vithalani
Jaswantiben Popat:
:
Was in her twenties when Lijjat was started. Shri Mahila Griha Udyog Lijjat Papad (‘Lijjat’) was registered as a cooperative under her leadership. Always believed in providing work that led to self dignity for women. Received The Economic Times “Businesswoman of the Year” Award in 2002.
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Chaganlal Karamsi Parekh:
One of the eldest members of the Lohana Community. Chaganlal Karamsi Parekh, popularly known as Chaganbapa, became their guide. Guide and philosopher of Shri Mahila Griha Udyog. Recommended production of a standard product.Stressed the importance of quality. Importance of running Lijjat as a business enterprise.Role in getting formal recognition from KVIC
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Core values: Shri Mahila Griha Udyog Lijjat Papad is synthesis of three different concepts, namely: 1.
The concept of Business.
2.
The concept of Family.
3.
The concept of Devotion.
All these concepts are completely and uniformly followed in this institution. As a result of this synthesis, a peculiar Lijjat way of thinking has developed therein.
The institution has adopted the concept of business from the very beginning. All the dealings are carried out on sound and pragmatic commercial footing. It produces quality goods and sells them at reasonable price.
It has never accepted nor it is ever going to accept any charity, donation, gift or grant from any quarter.
Besides the concept of business the institution has adopted the concept of mutual family affection, concern and trust which are the ‘idée fixe’ of the members. All the affairs of the institution are tackled on the very same pattern as a family carries out its own daily household chores.
But the most important concept adopted by the institution is the concept of devotion. For the members as well as the employees and the well wishers, the institution is never merely a
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place to earn one’s livelihood. It is a temple, a church, a mosque, a gurudwara, a place of worship to devote one’s energy not for his or her own benefits but for the benefit of all. In this institution work is worship.
"Who owns Lijjat?" In July 1979, the general secretary of a trade union tried to interfere in Lijjat's affairs, making certain demands on behalf of a few member-sisters. L. C. Joshi, Labour Advocate of Bombay and a well-known industrial relations expert, was called for consultations. In his observations on "Who owns Lijjat?", he clarified that member-sisters were competent to take a decision for their own and it was not open for an outside agency to interfere with the internal working of Lijjat.
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Organization Structure: In order to ensure that the working of the trust was professional, an organization structure and certain professional guidelines were put in place. Member-sisters owned the enterprise. Any women, irrespective of caste or religion willing to work in any capacity could become a member by signing a pledge of devotion to the basic tenets of the organization. It was a commitment to earn legitimate honest income thought wok on a cooperative basis.
Six Offices - Bearers 1. Smt. Jyoti J. Naik - President 2. Smt. Pratibha E. Sawant - Vice-President 3. Smt. Sunanda R. Belnekar - Secretary 4. Smt. Swati R. Paradkar - Secretary 5. Smt. Priyanka G. Redkar - Treasurer 6. Smt. Sheetal S. Koyande – Treasurer
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Lijjat believes in the philosophy of sarvodaya and collective ownership. It accepts all its working members as the owners and an equal partaker in both profit and loss. The members are co-owners and fondly referred to as "sisters". All the decisions are based on consensus and any member-sister has the right to vote a decision. Men can only be salaried employees (accountants, drivers or security guards), and not the members of the organization (i.e. they are not the owners). The running of the organization is entrusted to a managing committee of twenty-one members, including the President, the Vice-President, two secretaries, and two treasures. Sanchalikas are in-charge of various branches and divisions. The office bearers of the managing committee and the sanchalikas are chosen from among the member-sisters on the basis of consensus every three years. Each branch has a committee eleven member-sisters, again chosen by consensus. The central office at Mumbai previously coordinated the activities of various branches. But, as the organization grew, the authority was decentralized in terms of work and sharing of profits at the branch level. However, the sanchalikas still need the managing committee's approval before they undertake any new project or activity.All the branches follow the same set of instructions and have similar accounting system. To co-ordinate various branches in a region or state, there are branch coordination committees and area meetings of various branches in a state. The annual general meeting is attended by member-sisters representing branches and divisions all over India. Currently, Lijjat has branches in seventeen Indian states -- Andhra Pradesh, Bihar, Delhi, Gujarat, Haryana, Jharkhand, Jammu and Kashmir, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Orissa, Punjab, Rajasthan, Tamil Naidu, Uttar Pradesh, and West Bengal. Account books are easily accessible to all the member-sisters, ensuring transparency. Lijjat follows its own financial accountability principle. There is no credit method for running operations in the organization. Every payment is done on a daily basis, except for the outside supply of raw material. Profits and losses are shared equally among the members of a given branch. In the initial days of Lijjat, the profits of the first six months were shared equally among all sisters in the form of gold. This sharing practice is still in effect, but now the decision whether to share the profits in gold or in cash is made at the branch level. The cost of national-level advertising is borne by all branches and divisions, depending on their individual production abilities. Because of Lijjat's main motive of generating self15 | P a g e
employment for women, no machinery is used at the production level, and everything is done manually. However, computers are now being used in some of the Mumbai branches for accounts and administration.
Four P’s: Products: Lijjat’s most famous products is papad. Papad is their many and along product in market. In starting their use to make only two kinds of papad in order to sell the inferior one at a cheaper rate. Chaganbapa advised them to make a standard papad and asked them never to compromise on quality. Then lijjat started making differenced flavours of papad. After establishing lijjat into papad business their started into entry into new product. 1988, Lijjat entered the soap market with Sasa detergent and soap. THE LIST OF PRODUCTS AVAILABLE:
Papad (five flavors: lasan, moong, mirch, Punjabi and urad) Khakhra Appalam Masala Vadi Gehu Atta(Wheat flour) 16 | P a g e
Bakery products Chapati SASA Detergent Power SASA Detergent Cake (Tikia) SASA ilam Detergent power SASA Liquid Detergent
Place: Lijjta is spread over in seventeen Indian states. It has many Branches in many in states of India. It almost has about 69 Branches in all part of india. It is well settled in western part of india for e.g. in Maharashtra and Gujarat. In 1968 first branch outside Maharashtra was established at Valod, Gujarat .lijjta started first branch in M.P the first branch was in 1985, the Lijjat branch atJabalpur . Lijjat have branch visually all states of india. Exports accounts for Rs 170 million, merchant exports Major countries are UK, USA, Australia and European Countries.
Pricing: Shri mahila Griha Udyog Lijat papad adopts a Cost plus Pricing Strategy for all their products. The Lijjat products are targeted at the middle and lower segments of society. These segments are highly price sensitive and hence this method of pricing allows them to market their products extensively. While calculating the price the following expenses are taken into consideration: Cost of Raw material Rolling Charges Packaging Costs Selling Expenses
Consumer price list :
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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
Price – Export price list : Export price are different of the prices within India. Export price are high as compare to prices in India. So lijjat earn more profit through export as compare to India
Items
Udad with pepper
80 Pkts X 200 gms BigSize & SmallSize( 7in & 5in) in one carton rate per packet 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
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(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
Promotion: At Shri Mahila Griha Udyog Lijjat Papad, they believe that the best promotion they Could possibly receive is by word of mouth. Therefore they concentrate more on cost Effectiveness and quality rather than on more expensive modes of promotion like Advertisements. Therefore annual expense on advertisement and promotion amounts to Rs. 60 lakes,About merely 0.2% of total turnover. The extremely famous ‘bunny rabbit’ campaign continues to be aired on specific regional channels. For e.g. Alpha Guajarati, Alpha Bengali, Sun etc.
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They also advertise in English and regional newspapers. The distributors also need to be motivated properly, so that they in turn make a greater effort to sell large volumes of the products to the retailers. Targets are set quarterly for the distributors i.e. should they exceed this target; the distributor will receive a further 1% discount.
Advertising:
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In starting, the advertising was undertaken through the vernacular newspapers, television and radio. The money for advertisements was spent by the Polypropylene Division, which recovered the same by adding it to the price of the bags that it supplied to all the branches and divisions throughout India. Brand is having the strength of “ Consistently Good Quality” as its USP. Communicated its Crispness and quality through ads. Ads features a Bunny ( mascot) and jingle ‘Khurram Kharram”. Aired on specific regional channels e.g. Alpha Gujrati, Sun TV etc
Packaging Process: 21 | P a g e
The institution itself carries out the packaging process instead of having collaboration with others. These plastic bags are manufactured without any technical help or machinery; instead it is hand-made. These employees are also women. The packaging department comprises of 70 sister members. The bags that are used for packing papads are Polpopryin (PP) bags. These bags are manufactured at a factory situated at Dahisar. Because of this it prevent duplication of their product.
Quality Check: 22 | P a g e
The papads are prepared in different parts of India, the quality of the water used usually varies, and so can the quality of final product. To prevent any inconsistencies, Lijjat has its own laboratory in Mumbai, where the final products are tested and coded. In the monthly meetings, the quality issue and modifications are tested. Ingredients purchased and distributed by the Central Office to maintain the quality. Procurement of Ingredients o
Urad dal from Myanmar
o
Asafetida from Iran
o
Black Pepper from Kerala
Surprise visits to various branches to ensure production conditions are hygienic. When a new branch of Lijjat opens, a neighboring Lijjat branch helps it by guiding and t raining new members. Successive failures of a branch to abide by the organization's philosophy of consistent quality and production of papads, the central committee reduces the daily wages of its members by 1 rupee.
Divisions: 23 | P a g e
Shri Mahila Griha Udyog has diversified its various activities. Besides it's world famous papads it also currently has A Flour Division at Vashi (Mumbai) where flour is milled from Udad Dal and Moong Dal. A Masala Division at Cottongreen (alongwith a Quality Control Laboratory) at the same place where different kinds of spice powders like Turmeric, Chillies, Coriander and ready mix masala and like Garam Masala, Tea Masala, Pav Bhaji Masala, Punjabi Chole Masala etc. are prepared and packed in consumer packs. A Printing Division also at the same place. Lijjat Advertising Division at Bandra (Mumbai) A Khakhra Division at Buhari (Dist-Valod) Chapati Divisions at Wadala, Borivali, Mulund & Kandivali (Hanuman Nagar) A Polypropylene set-up at Kashi-Mira Road. A Vadi producing factory at Valod. A Bakery Division at Valod. A Detergent Powder and Cakes manufacturing unit at Pune (Sanaswadi) and Hyderabad.
Distribution Flow Chart: 24 | P a g e
The entire cycle starts with a simple recruitment process. Any woman who pledges to adopt the institution's values and who has respect for quality can become a member and coowner of the organization. In addition to that, those involved in the rolling of the papads also need to have a Clean house and space to dry the papads they roll every day. Those who do not have this facility can take up any other responsibilities, like kneading dough or packaging or testing for quality. Packed papads are sealed into a box (each box holds 13.6 kg) and the production from each centre is transported to the depot for that area. Mumbai alone has sixteen branches and six depots. Each depot stocks production from the nearby three to four branches -- roughly about 400 boxes. In some smaller towns or villages, the branch itself serves as the depot. The depots are our storage areas as well as pick up points for distributors.
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Distribution flow chart
Their distributors pick up the quantity of papad they require and pay cash on delivery because they pay their bens (members are called bens, or sisters) every day. Since they have an estimate of the quantity each distributor takes, they produce accordingly. This ensures that they neither stock inventory nor pay heavily for storage. They have about 32 distributors in Mumbai. Each distributor picks up an average of 100 boxes per day from the depot. This is where their job ends. They are not involved in how and where a distributor delivers as long as he stays within the area they have marked for him. Generally each distributor has his three-wheeler and about eight to ten salesmen to deliver to retail outlets within his territory.
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To select a distributor, they first give an advertisement in newspapers for the areas they have marked. Members from their marketing division personally go and check the godown facilities and only on their approval do they appoint distributors. A distributor pays them Rs 150,000 as deposit. They make it clear to them that they must pay on delivery if they want our distributorship. This system is followed all over India and it works well for them. When they discover that there is demand in a particular place, they open a new branch, like the recently opened one in Jammu and Kashmir. Whether or not they have a centre in an area, their goods reach there. For example, they do not have any centre in Goa, but they have appointed a distributor for that area to ensure that Lijjat papads reach Goa. Their communication with distributors is regular through monthly meetings where they discuss their problems and also the issues that they may have about quality, price, reach, etc. They do not have individual door-to-door salesmen or women selling from homes only the appointed distributor for the area. The same system is followed for other products, but they may have different distributors and depots for different products
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Collection Flow Chart: Their exports alone account for Rs 24 crore (Rs 240 million). They are not directly involved in exporting, but recognized professional merchant exporters (who also export other food products) place an export order. Only on receiving the full advance through a cheque do they begin production. Because all exports are done from Mumbai, the supply also comes from here. Export production is of the same quality as daily production. In fact, they send some of the daily production for export.
Collection flow chart
Again with exporters, our responsibility ends with delivery. They are, both, expected and encouraged to check the goods on collection. After that, where and how they export is their call. At present, 30 per cent to 35 per cent of the production of Lijjat Papad is being exported, mainly to countries like the United States, the United Kingdom, the Middle East, Singapore, Hong Kong and Holland.
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The Growth: Membership has expanded from an initial number of 7 sisters from one building to over 42,000 sisters throughout India. The main reasons of expanding of lijjat was when lijjat started very few women was allowed to go and worked outside their house. As lijjat first product was papad .Many women known how to make papad. As of making papad does not any technical skill or any education so women can easily make papad so their started joining lijjat. Because of this there can help their family with some finically support.
The organization is wide-spread, with its Central Office at Mumbai and its 69 Branches and 37 Divisions in different states all over India. Early organizations have their office in Bhuleshwar then their shifted to Bandar. The organization has widely speared all over India. The 69 branches are spread over in seventeen state of India.
The venture started with loan of Rs 80. Lijjat’s annual sales increased from Rs 6,196 in 1959 to more than Rs 4.7 billion in 2009, with exports itself exceeding Rs. 240 million.
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Profit Generation: Profit generation is considered essential as that is what makes the organization self sustainable. To run any organization specially lijjat their must profit to their business Running. Lijjat is huge organization structure. To support, hold, or bear up from below profit is very important.
Lijjat is register under KHADI & VILLAGE INDUSTRIES COMMISSION in 1965 This help lijjat is many way. The Khadi and Village Industries Commission have sought exemption for its products from the value added tax (VAT). Which the institution availed bank finance of Rs. 5.90 crore during 1998-99 and 1999-2000 and Rs. 7.90 crore during the Period 2000-01 to 2003-04 from three different banks at varying rates of interest. 7.1.3 The rates charged by the three banks namely, Bank of Baroda, Bank of India and Dena Bank for the period April 2002 to March 2004 were 0.5 per cent to 2 per cent, 1.36 per cent to 2.6 per cent, and 3.06 per cent to 4 per cent higher than the prime lending rates fixed by the respective banks. Hence, the Commission had to bear excess interest liability of Rs. 38.70 lakh for the period 2002-03 and 2003-04. Further, considering the average difference in rates of interest, the excess payment of interest subsidy for the period 1998-99 to 2001-02 worked out approximately Rs. 64.47 lakh.
In lijjat there is less number of administrative staff per centre to reduce expenses. Because of this salary to given to the staff is saved.
Own network of suppliers as the product range does not give credit to the retailers. Because policy of lijjat all transaction are due in cash. The risk of bad debtor is fully avoided. All of their money is recovered in very fast. Today, Lijjat Papad is the generic reference for papads
Each branch is responsible for all activities from production to packaging to collection and distribution of vanai and profit for its particular geographical region. This ensures that each branch works efficiently with profit as motive
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Financials:
liijat papad sasa Masala Khakra other
Pie chart of PROFIT
The accumulated profits of the Lijjat enterprise stand at Rs. 80 million.
The annual profits for the year are Rs. 200 million. This was achieved on an annual turnover in 2008-09 of Rs. 4.7 billion. liijat papad contribute around 45% of total sale in lijjat. Sasa had annual sales of Rs 700 million, accounting for 17 percent of Lijjat's total turnover in 2009. Masala, khakra and other had sales around Rs 1.8 billion. Total to 19% of total lijjat sales. Other contribute about 18% of lijjat sales.
The Sisters Savings Fund is also available to the each of the Lijjat branches, to tide over short-term cash deficits, in case of necessity. If any case lijjat need money there can use money from sister saving fund. These funds can use organization for short period of time. By using this funds there does not to pay any interest to anyone. We can say that there are using fund of free. Generation of resources and rotating working capital on a weekly/biweekly cycle.
Marketing is on a strictly cash-and-carry basis, allowing for funds to be continuously recycled. There does not give any discount to any retail. All transactions are recorded on a daily basis.P & L and Balance Sheet are prepared every month. Branch doesn’t open for transaction in case the accounts are incomplete for the previous day. The average monthly income to each worker is Rs.3000/mth. Loans of Rs. 8.94 lakhs under the Processing Cereals and Pulses Industry Scheme., for expansion of existing branches, establishment of new ones and for purchase of equipment for the masala unit .On the whole, labour charges work out to about 20-25 per cent of the total cost, with raw materials consuming 55-60 per cent and sales and other administrative expenses making up the remaining 20 per cent
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Exports: Lijjat’s exports alone account for Rs 24crs (Rs 240 million).Not directly involved in exporting, but recognised professional merchant exporters (who also export other food products) place an export order .Only on receiving the full advance through a cheque production is undertaken. Because all exports are done from Mumbai, the supply also comes from here. Export production is of the same quality as daily production.Again with exporters, responsibility ends with delivery.At present, 30 per cent to 35 per cent of the production of Lijjat Papad is being exported, mainly to countries like the United States, the United Kingdom, the Middle East, Singapore, Hong Kong and Holland.
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Business is the Motto: Run and perceived as a serious business, not a charity organisation. There is no place for feelings of pity, sympathy or charity among members. We also do not accept donation or charity of any kind, even if voluntarily offered. This has helped the organisation retain independence and brought quick growth. It has given clear vision of the path of progress. Maintaining proper accounts has always been on our agenda Every branch closes the account book every day.
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Business Transparency: Each branch office is responsible for setting a target for monthly production and the marketing. Each Lijjat centre has a clearly delineated marketing territory to avoid competition amongst centers .Commission agents are attached to almost all Lijjat Centers and they account for a major part of the Lijjat sales. Lijjat has a separate marketing, sales, and advertising divisions same prices across the category
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Flexibility: The decentralized production methodology has ensured that the women do not have to leave their homes for work It allows them flexible working schedule enabling them to discharge other household responsibilities This account for the easy acceptance of the work among such a large number of women since they feel their economic activity will not disrupt the family by their absence Men are also less hostile to women working at home for extra income than travelling to a workplace Self selection of work by the members.
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SWOT Analysis: Strengths: Sincere Hard work Development of woman by providing them a living / Employment. Maintaining the same standard over the last 50 years. Having a unique status in the country.
Weakness: Lack of marketing skills Less use of technology Limited capital Semi-literate
Opportunities: Expanding horizontally as well as vertically Increasing export Business can be made sustainable/profitable without high initial investment
Threats: In the Papad industry, the major competition or threat is posed to the institution by Ganesh Papad In the spices industry, the Haldiram and MDH are the major competitors In detergent, there are many competitors like HUL, P&G etc.
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Awards to liijat: “Best Village Industry” for the period 1998-1999 to Khadi & Village Industries”.
2000-2001 from “Commission of
A “Businesswomen of the Year 2001-2002 for Corporate Excellence” Form the Economic Times
In January 2003 it received
the award for “Best Village”at the hands of Hon’ble Prime Minister Shri Atal Bihari Vajpayee
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On 21st December 2005 institution has received has Received the “Brand Equity Award at the hands Hon’ble President of India, DR.A.P.J Abdul kalam
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