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BAKARKHANI BUSINESS IN PURAN DHAKA:


A Look into a Micro Enterprise Industry


PREPARED FOR
Mr. Sheikh Morshed Jahan
Associate Professor



PREPARED BY
Group 5, Section A, BBA 20
th

ZR-05 MD. Mazharul Islam
ZR-08 Abashesh Biswas
RH-09 Tashfia Rawnak Anika
ZR-15 Fahmin Rahman
RH-19 Fableeha Bushra Chowdhury
RH-28 Syeda Shehtaz Hasib
ZR-31 Nishadul Haque Nihal
ZR-32 Rakib Khan
ZR-39 Sabbir Hossen
RH-48 Sadia Samira
ZR-60 Sajeed Alam
ZR-62 Ahnaf Ahmed



Institute of Business Administration
University of Dhaka
27 April 2014

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CONTENTS
Executive Summary .................................................................................................................................................................. 3
1.0 Introduction ....................................................................................................................................................................... 4
1.1 Bakarkhani Industry Profile............................................................................................................................................. 5
1.2 SWOT Analysis ............................................................................................................................................................... 6
2.0 Major Findings ................................................................................................................................................................... 7
2.1 Observations and Insights............................................................................................................................................... 7
2.1.1 Apprentice System .................................................................................................................................................. 7
2.1.2 Importance to Quality and Customers...................................................................................................................... 7
2.1.3 Strong Work Culture................................................................................................................................................ 8
2.1.4 Seasonal Demand .................................................................................................................................................... 8
2.1.5 Declining Profitability .............................................................................................................................................. 8
2.2 Sustainability Index and Maturity Timeline of Bakarkhani Industry .................................................................................. 9
2.2.1 Profit for owner ...................................................................................................................................................... 9
2.2.2 Customers..............................................................................................................................................................10
2.2.3 Employees .............................................................................................................................................................10
2.2.4 Value Chain Actors .................................................................................................................................................10
2.2.5 Society ...................................................................................................................................................................10
3.0 Triangular Framework ...................................................................................................................................................11
3.1 Organization Effectiveness ........................................................................................................................................11
3.2 Industry Effectiveness ...............................................................................................................................................12
3.4 Economy Effectiveness ..............................................................................................................................................12
4.0 Challenges and Prospects ..................................................................................................................................................13
5.0 Reflections and Take Aways ...............................................................................................................................................14
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EXECUTIVE SUMMARY

As the story goes, the name Bakarkhani was derived from the powerful General Aga Baker in the late
Nababi period. Bakarkhani whose origin goes back to as early as the Mughal era, is a unique bread with
a crispy texture. This age-old traditional food has survived the test of times, and still lingers in the
alleyways of Puran Dhaka, Bangladesh. This rare bread is usually eaten over a cup of tea, but variations
of the Bakarkhani may include adding cheese and khimar to enhance its flavors.

Bakarkhani shops in Puran Dhaka are micro enterprises that make up a small cluster or industry. In our
Bakarkhani field visit to Puran Dhakas Chankarpur, Lalbagh. Becharum Dewry, Doyagonj, Nazimudding
Rd and Narinda, around 30 Bakarkhani shops were surveyed and many of the shop owners were
interviewed. The field visit revealed many interesting facts about the Bakarkhani industry and allowed
us to draw some insights through our observations. Among other observations, it was seen that the
Bakarkhani industry works under an apprentice system whereby young children are trained on how to
make Bakarkhani from an early age. Our survey further revealed that the Bakarkhani makers give utmost
importance to customer satisfaction even though they do not get a fair price (one Bakarkhani costs only
3 Taka on average) for the breads they make with so much care. Furthermore, inside the Bakarkhani
shops where there are as few as 3 employees; there was an evident display of a strong work culture.

However, due to the declining demand of Bakarkhanis and its falling value, the industry is facing some
serious hurdles and many of the entrepreneurs are regretting coming to this industry. Hence, after
discussing some of the major findings of our field visit, the main challenges and the possible prospects of
this declining industry are highlighted, followed by some reflections and take aways from the research
on a micro enterprise, Bakarkhani.


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1.0 INTRODUCTION

The name 'Bakarkhani' is synonymous with Puran Dhaka. Every turn of a corner on the narrow streets of
Puran Dhaka are occupied with five to six small Bakarkhani shops.
Bakerkhani is a unique confectionary, a crispy spiced golden brown flat-bread that is enjoyed with the
morning tea or as a snack. Besides, it is quite compatible with beef, chicken or mutton curry. At times, it
may be also served with condensed milk or honey. Usually a salted treat, variations of Bakerkhani
include sweet ones and those with cheese added to enhance the flavor or the treat. It is a food that is
cheap cheap in price but rich in taste.
It's foundation dates back to the Mughal era, who had a very strong and influential food culture. The
origin of the name Bakarkhani is quite an interesting story, it goes as a legendary, sad love story
between Aga Bakar and Khani Begum around the middle of eighteenth century inspired the naming of
the bread. According to the book "Kingbadantir Dhaka" by Nazir Hossain, Aga Bakar a general in
Chittagong during Nabab Siraj-ud-daulah's reign (1800s), madly fell in love with a beautiful dancer, Khani
Begum. Another official, Jainul Khan, abducted Khani Begum as he had an eye for her at the same time.
As Aga Bakar rescued Khani, Jainul fled resulting a rumour that Aga Bakar assassinated Jainul and hidden
his dead body. Eventually, both Khani Begum and Aga Bakar were arrested. Aga Bakar was sentenced to
death and put in a cage with a tiger. Strong in his will and love, Aga Bakar killed the Tiger and
escaped. In the meantime, Jainul abducted Khani one more time and killed her. It is said that Aga Bakar
immortalized his love for Khani Begum and her memory through this specially prepared bread by
naming it 'Bakar-Khani' .
Bakarkhani stands as a symbol of love, a totem of our history and beacon of hope for those still clinging
onto the last relics of a culture in decline. The Bakarkhani is more than just multi-layered bread; it is in
fact a reminder of the affluence and magnificence of our ancient times.



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1.1 BAKARKHANI INDUSTRY PROFILE

Place Puran Dhaka - Shaatrouja, Nazimuddin Rd.,
Chankharpur, Lalbagh, Narinda
Number of shops Around 30 shops that make and sell Bakarkhani Rotis
in the industry
Most shops can be found in small clusters spread
throughout Puran Dhaka
Average number of employees The Bakarkhani industry is heavily depended on the
employees. They are refered to as the karigors.
They are very highly skilled cooks who are adept at
Bakarkhani preparation techniques as they receive on
the job training and apprenticeship from a very young
age
Each shop employes about 3-4 karigors all of whom
work simultaneously for the preparation of
Bakarkhani .
Average capital Average start-up capital required is very low as most
shops in the Bakarkhani industry locality which are
specialized to be Bakarkhani shops are already fitted
with the necessary fixtures, fittings and equipments
required for the production process.
The average startup capital required for this business
is about 35,000 Tk.,
Sales The selling price for Bakarkhani are fixed in the locality
since the market for Bakarkhani represents a perfectly
competitive market pattern.
The prices vary with the size of the Bakarkhani that is
being sold. The larger ones are sold at 5 Tk each and
the Smaller ones are sold at 3 Tk each.
They are also priced on their weight if bought in large
quantities. For the large ones the price is around Tk
100 per kg.
There can be around 22-25 Bakarkhani in 1 kg.
Daily sales revenue on an average can range from
2000 to 3000 tk depending on the demand for the
day.
On most days sales can range from 500 - 700
Bakarkhani .


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1.2 SWOT ANALYSIS



Strengths

Skilled, knowledgeable and experienced workers
Bakarkhani is rich in quality and taste and has unique flavor characteristics
Quite popular among residents of Puran Dhaka
It stands as a symbol of tradition and cultural heritage



Weaknesses

Demand is seasonal (more demand in winter)
Profit depends solely on sales volume
Industry highly dependent on skill of workers or 'karigors'
Changes in price of raw materials greatly affect the profit margin of individual
businesses
Perfectly competitive market

Opportunities

Scope for expansion as large scale production
Efficient management will lead to a more productive business hence progressive
industry

Threats

Industry may become obsolete if the need is satisfied with other baked goods
such as biscuits or dry cakes


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2.0 MAJOR FINDINGS
2.1 OBSERVATIONS AND INSIGHTS
In our Bakarkhani field visit to Puran Dhakas Chankarpur, Lalbagh. Becharum Dewry, Doyagonj and
Narinda, we came across some notable observations that were common to almost all the 30 shops we
surveyed.
2.1.1 APPRENTICE SYSTEM
Bakarkhani is hand-made bread that is made in a mud-oven heated with coal. Making this unique bread
takes years of practice to master. On every shop surveyed, it was observed that very near to the hot
stove, a boy not more than 14 years old, would be kneading dough for the bread to be rolled and later
baked. Under expert supervision, a young apprentice is given this moderately easy job initially to get him
used to the art of making a Bakarkhani . The apprentice, over the years, learns how to roll the bread in a
special way and add the thin layers of pastry which gives Bakarkhani its unique crisp texture.
When asked about why a particular young employee was kneading dough instead of being at school on a
weekday, his employer (who usually is a very close family member) would falter in reply, but say that
the boy does go to school. It was found that some of the children employed in the Bakarkhani shops, go
to evening classes in a public school nearby.
2.1.2 IMPORTANCE TO QUALITY AND CUSTOMERS
The bakers emphasized that they want to keep up the product quality. But consumers and customers
are not very willing to pay higher prices. However, they are ok with it. Their target is to reduce
profit/unit but to maximize the sale volume; therefore a higher total profit.
Almsost all the Bakarkhani shop owners emphasized the importance of making high quality Bakarkhani s
for their customers. Even though their profit margin is very little (price of a Bakarkhani is 3 Taka on
average), great importance was placed on making Bakarkhanis with the utmost care and expertise for
their customers. It was apparent that the owners target was not to increase the profit margin but sell
the maximum number of quality Bakarkhanis.

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2.1.3 STRONG WORK CULTURE
Typically, the work culture of the Bakarkhani shops is very strong. One of the reasons for this is because
there are not many employees (maximum 5 or 6). These few employees are usually close relatives
(father-son, brothers, etc) and enjoy each others company when making the Bakarkhani s.
One of the shop owners surveyed mentioned that on an usual day, he and his employees drink tea
almost 20 times. He said that tea and Bakarkhani are a sound combination, and drinking tea every now
and then is part of their culture as Bakarkhani makers.
2.1.4 SEASONAL DEMAND
Since Bakarkhani goes best with tea, the highest sales of Bakarkhani are experienced in the winter
season when people drink tea the most. Furthermore, during the wedding season, the brides side
makes a special sweet dish out of Bakarkhani s and milk. This sweet dish is sent to the grooms house as
a tradition. Sales of Bakarkhani , thus increase during winter which is also the wedding season and
during other festive seasons like Eid.
In summer, the sale of Bakarkhani declines because the dry confectionary does not go well with the
heat. According to one of the business owners surveyed, people buy more fruits to refresh themselves
and hence sale of Bakarkhani declines because it's not a refreshing food to have during the heat.
2.1.5 DECLINING PROFITABILITY
Even though some of the Bakarkhani shop owners were satisfied with their business, most of the owners
mentioned that they were suffering from low customer demand of Bakarkhani s. Generally, the shops
do not make much every month and their income barely affords them a sound living.
One of the shop owners surveyed, who was an old man suffering from diabetes, mentioned that out of
desperation he left his low paying job at another place to build a Bakarkhani shop. But now, he feels that
he is not that better off and suffers to manage a living out of the very little profit he makes from the
small Bakarkhani shop in Becharam Dewry.
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Another shop owner surveyed told felt so frustrated with the declining demand of Bakarkhani said that
he feels like committing suicide by eating poison.


2.2 SUSTAINABILITY INDEX AND MATURITY TIMELINE OF BAKARKHANI INDUSTRY
Bakarkhani industry is a very small one that serves to a finite niche market. It was found that this micro enterprise
climbs up four of the ladders that lead to a sustainable business. The industry is only short of societal awareness.

2.2.1 PROFI T FOR OWNER
The Bakarkhani shop owners generally do not make much profit. When asked about why they came into
the business of making Bakarkhani , most replied, it was due to presumable profit which has later turned
out to be rather low.
The entrepreneurs come into this industry because they are driven by a desperate need to earn a living.
Making Bakarkhani is one of the few things that these entrepreneurs are skilled, knowledgeable and
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experienced at from their family heritage. Hence, it could be concluded that because of socio-economic
hardships and family traditions, most entrepreneurs opted for opening up a Bakarkhani shop despite its
low profitability.
2.2.2 CUSTOMERS
Customers are a very important part of the Bakarkhani industry in Puran Dhaka. All the shops surveyed,
reportedly emphasized their business importance of satisfying customers with their intricately made
Bakarkhanis. For instance, some of the shops surveyed said that their main objective is to satisfy the
customers with high quality Bakarkhani s even if it is at a low price and low profit margin.
2.2.3 EMPLOYEES
The Bakarkhani shops employ very few employees (as few as 3). Employees are usually the owners
relative or a friend or acquaintance. Due to the process of making a Bakarkhani , these few employees
are required to work as a team - one person makes the dough, another one kneads, another person rolls
out the dough while another person puts the flattened breads into the hot mud-oven fired by charcoals.
Due to the nature of the work, the few employees are given due respect by the their fellow workers.
However, children making Bakarkhani s are often forced to work at the shop by skipping school.

2.2.4 VALUE CHAIN ACTORS
The Bakarkhani owners did not emphasize any concern over their value chain actors. This is mainly
because making Bakarkhani requires only a few raw materials like oil, flour, dalda, cheese, etc. These
ingredients are acquired from local suppliers who have long-term business relationship with the
Bakarkhani owners. In some cases, the owners said that they buy from whoever it is most convenient
and that they don't have a long term relationship with any suppliers.
2.2.5 SOCIETY
The Bakarkhani shop owners are not aware of their shops effect to the society. However, the owners
did mention that they feel proud to be able to uphold an age old heritage of Puran Dhaka and
Bangladesh as a whole.
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3.0 TRIANGULAR FRAMEWORK

3.1 ORGANIZATION EFFECTI VENESS

1. Capital: Most Bakarkhani shops set up cost is not more than 30,000 Taka. The shops are a
compact, narrow room where the front side opens to the street outside. The mud-oven is made
inside the shop and this makes the temperature inside the Bakarkhani shop almost unbearably
hot.

2. Capability: The Bakarkhani shop workers are skilled at making this special bread. There is almost
always a young apprentice in the shop who learns the art of making Bakarkhani first-hand, from
a very early age.

3. Culture: Culture in the Bakarkhani shops is also very strong. Most times the employees are
related by family ties. The employees work as a team and have a friendly work environment.

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3.2 INDUSTRY EFFECTIVENESS
1. Customers: Customers are considered a very important part of the Bakarkhani industry. Most of
the shops surveyed reported that customers drive them to make high quality Bakarkhani s.

2. Competitors: Competition in the Bakarkhani industry is more or less fair and ethical. Almost all
the shops offer their Bakarkhani s at a price as low as 3 Taka. Because the competing shops are
clustered around Puran Dhaka, the individual shops experience the advantage of attracting
customers to the region.

3. Collaborators: Collaboration amongst the Bakarkhani shops exists as owners come from the
same hometowns (mostly Sylhet and Brahmanbaria).

3.4 ECONOMY EFFECTIVENESS
1. Technology and Information: Potential for technological improvement, does not exist in the
Bakarkhani industry as the age-old technique of baking the Bakarkhani in a mud-oven fired by
charcoals, brings a special type of burnt flavor on the this unique bread.

2. Collaboration and International Forces: This is not applicable for Bakarkhani industry as there is
no collaboration of impact of international forces.

3. State and Society: Government currently does not employ any benefits to the Bakarkhani
industry. However, society of Bangladesh knows Bakarkhani as a traditional bread.





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4.0 CHALLENGES AND PROSPECTS
The Bakarkhani industry in Puran Dhaka faces many dire problems. One of the major challenges it faces
is the problem of declining demand. People do not seem to be as much fond of Bakarkhani s as they
used to be in the earlier days. It is often seen that it is the older people of Bangladesh who treats
Bakarkhani like a delicacy that goes especially well with tea. However, the younger generation who
make up more than 50% of Bangladeshs population are not quite aware of Puran Dhakas heritage food
called Bakarkhani .
Despite the challenge of a dying market, the Bakarkhani industry has many prospects in its future. Some
of the prospects of the Bakarkhani Industry are listed below.
1. Setting up a Brand: The Bakarkhani of Puran Dhaka is a rare delicacy that cannot be found in
any other place of the world. The culture of Puran Dhaka and Bakarkhani meld together. In fact,
it is because of Bakarkhani that Puran Dhaka is so famous. Hence, there is a lot of potential for
portraying Bakarkhani as a brand.
2. Variation in Flavors: One Bakarkhani shop was seen selling 100 variations of Bakarkhani under
customer orders. Among other variations, the shop sold chocolate, orange, horlicks and other
flavored Bakerkhanis.
3. Selling throughout Bangladesh: People from many places of Bangladesh come to Puran Dhaka
just to buy Bakarkhani . This huge market is under served in the sense that people have to come
a long way to buy Bakarkhani s. If a feasible supply chain were set up, then people throughout
Bangladesh could enjoy the crispness of Bakarkhani over a cup of tea. And at the same time, the
Bakarkhani makers can enjoy higher sales.
4. Selling outside Bangladesh: Expatriates who live in countries outside Bangladesh are often seen
buying bulk quantities of Bakarkhani from Puran Dhaka. A huge market lies for non-residential
Bangladeshis. Hence, if the Bakarkhani s could be exported, not only these customers would be
satisfied, but Bakarkhani workers can get a higher sales, and more profit.
5. Higher price: Making a Bakarkhani requires a lot of perseverance as the workers need to sit right
next to an extremely hot oven whose temperature can reach up to 400 degrees celsius.
Furthermore, a lot of care goes to making a Bakarkhani and yet the price of a Bakarkhani is
trivial, costing only 3 Taka. People must be convinced to pay a higher price for Bakarkhani ,
otherwise, the situation of the Bakarkhani industry will continue to look bleak.
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6. Owners association: Unless the owners manage to unite themselves and form an effective
association, it will not be long when Bakarkhani will be available not for consumption but for
exhibition.

5.0 REFLECTIONS AND TAKE AWAYS
Bakarkhani has been a traditional food of Puran Dhaka over the years and it has successfully established
itself as a brand. But recently the demand for Bakarkhani has been on the wane. The advent of fast food
has taken its toll from this old industry and it is now struggling to cope up with the change in trait. The
hardship of the owners to sustain the glorious past just does not seem to be helping it any more.
Intervention from higher authority also seems to be a bit too farfetched as the industry does not have
any materialistic value to the government.
The field visit to Puran Dhaka provided us with some valuable insights into the small business industry of
Bakerkhani. It helped us learn about the struggles and achievements of a small business cluster.
Following are some of the things we have learned in the long and the short run.
Short run
Comprehension of work life at the base of the pyramid
Insight into the distinguishing features of a large and micro industry
Insight into the distinguishing traits of a micro enterprise
Humbled view towards life after observing other peoples struggle
Heightened interpersonal skills
Sharpened skill of persevering through unfavorable weather and environment conditions

Long-run
First-hand knowledge about micro enterprises
Knowledge about Bangladeshs businesses at the base
Basis for further understanding business
Acquirement of important tool to become an efficient manager