212 Int. J. Indian Culture and Business Management, Vol. 10, No.

2, 2015

Investigating distribution practices of Banarasi silk

industry: an empirical study

Alok Kumar Rai and Medha Srivastava*

Faculty of Management Studies,
Banaras Hindu University,
Varanasi – 221005, Uttar Pradesh, India
Email: alok.fmsbhu@gmail.com
Email: srivastava.medha@gmail.com
*Corresponding author

Abstract: Distribution is a trade decision that is mainly responsible for

bridging the gap between a manufacturer and his customers. There have been
numerous advancements in business processes and avenues affecting almost all
kinds of decision-making that take place in a commercial organisation.
E-commerce, e-business, mobile commerce, supply chain management,
software-enabled ERP etc. are few that have transformed the distribution
format of the industries. Banarasi silk industry is a centuries old industry and is
the economic life line of millions of people of Eastern Uttar Pradesh. There has
been a serious downturn the industry has been experiencing in the recent past.
The present paper studies the distribution practices of Banarasi silk industry
and evaluates its practices from the customers’ perspectives. The paper also
attempts to suggest solutions to the industry for redesigning its distribution
related decisions for securing sustained success.

Keywords: Banarasi silk; distribution practices; Indian culture; customer

satisfaction; price regulation.

Reference to this paper should be made as follows: Rai, A.K. and

Srivastava, M. (2015) ‘Investigating distribution practices of Banarasi silk
industry: an empirical study’, Int. J. Indian Culture and Business Management,
Vol. 10, No. 2, pp.212–229.

Biographical notes: Alok Kumar Rai is a Professor in Faculty of Management

Studies, Banaras Hindu University, Varanasi. His areas of interest include
marketing and customer relationship management. He has four other books to
his credit from leading publishers of the world. He has wide experience of
teaching, training, research and consultancy. He has published many research
papers and articles in leading national and international journals and has made
presentations in several national and international seminars and conferences.
He has completed major research projects funded by UGC and AICTE along
with research, training and consultancy assignments for government and
corporate.

Medha Srivastava is currently pursuing her PhD at Faculty of Management

Studies, Banaras Hindu University. She has two years of experience in
management teaching and her core areas are customer loyalty and marketing of
services. She has presented papers in various national and international
conferences. She has several research papers published in the leading
management journals of the USA, Europe and Asia.

Copyright © 2015 Inderscience Enterprises Ltd.

 Investigating distribution practices of Banarasi silk industry 213

1 Banarasi silk industry: an introduction

India is widely revered for its vivacious art forms, vibrant culture and veracious heritage
of art, music and literature. While pointing towards the richness of handloom industry
and handicraft’s cultural heritage, Singh and Naik (2009) stated that “India has a rich.
Indians are world famous for their magnificent workmanship and produced the most
beautiful and exquisite hand spun and hand-woven textiles”.
Since ages, India has witnessed myriad political and demographical changes and so
has its culture. From Rajputs to Mughals to Portuguese to British, each race has left
indelible marks of its ethnicity on Indian culture thereby rendering it diverse colours and
combinations of preferences and palates. One of the cardinal aspects of its culture is the
various dresses worn in different parts of the country. Indian saree is one such dress
which is common to almost every Indian state and hailed as supreme in quality and
design. Banarasi silk sarees have been an integral part of the Indian sartorial landscape.
In the most ancient and sacred city of Varanasi, there thrives an equally ancient
tradition. During the Mughal era, all art was amalgamated to create a fusion of aesthetics.
Persian motifs and Indian designs on silk studded with gold and silver became a mark of
class and elegance. Varanasi is famous for its finest silk sarees and brocades. These
sarees are known for rich and intricately woven motifs of leaf, flowers, fruits, birds, etc.
on a soft colour background. They are enriched with intricate borders and heavily
decorated pallus. The centre is also known for its gauzi silver and gold tissues, which are
ultra light in weight and delicate. The kinkab of Banaras is legendary. It is a glittering
weave of gold and silver threads.
Banarasi silk is weaved mainly by using mulberry silk yarn (90%) and remaining
(10%) by Tasar, Munga and Eri silk. Banarasi silk fabric includes brocade, crepe,
Charmeuse, Doupioni, Noil, organza, satin, Jangla and Tanchoi. Silk, known as Pattu or
Reshami in southern parts of India and Resham in Hindi/Urdu (from Persian), has a long
history in India and is widely produced and purchased today. Historically, silk was used
by the upper classes. Today silk is mainly used in Bhoodhan Pochampally (also known as
silk city), Kanchipuram, Dharmavaram, Mysore, etc., in South India and Banaras in the
North for manufacturing garments and Sarees. ‘Murshidabad silk’, famous from
historical times, is mainly produced in Malda and Murshidabad District of West Bengal
and woven with handlooms in Birbhum and Murshidabad District. Another place famous
for production of silk is Bhagalpur. The silk from Kanchi is particularly well-known
for its classic designs and enduring quality. The silk is traditionally hand-woven and
hand-dyed and usually also has silver threads woven into the cloth. Most of this silk is
used to make sarees. The sarees usually are very expensive and vibrant in colour.
Bowonder and Sailesh (2005), in their case study of Kancheepuram silk sarees, talked
about the introduction of computerised Jacquard borders in the Kancheepuram silk saree
and pointed that silk industry in Kancheepuram became a high growth industry as new
avenues for the traditional weavers have been opened through usage of information and
communications technology (ICT).
Garments made from silk form an integral part of Indian weddings and other
celebrations. The heritage of silk rearing and weaving is very old and continues today
especially with the production of Muga and Pat riha and mekhela chador, the three-piece
silk sarees woven with traditional motifs. Mysore silk sarees, which are known for their
soft texture, last many years if carefully maintained.
214 A.K. Rai and M. Srivastava

Nadigar et al. (1995) examined the ‘Marvelous Kancheepuram silk sarees’ and found
that local market for these sarees is mainly limited to southern states of Andhra Pradesh,
Karnataka and Tamil Nadu where they are marketed in local cooperative societies. Also,
many progressive master weavers market the saree through retailers. Krishnamurthy et al.
(1996) chose to study the ‘Kumbhakonam sarees: a blend of tradition and modernity’ and
reported that these sarees have a sound domestic market in the southern state of the
country where they are sold mainly through retail outlets and get exported to overseas
like New Work (USA) and Singapore in limited numbers. Munikrishnappa et al. (1996)
in their study on ‘Silk fabric marketing’ found that government and private houses of
Mysore are primarily responsible for marketing of silk fabrics where pricing is an
important issue. They revealed that every silk showroom has a policy of fixed prices
determined either by the respective head offices in government-owned outlets or factors
such as profit margins, market demand, consumption patterns and purchasing power of
consumers. Mamatha and Naik (1997) carried their study among Ikat weavers of Andhra
Pradesh and argued that 70% of them transact with master weavers followed by
cooperative societies, wholesalers or consumers respectively. Sanapapamma (2000)
found that Molakalmuru weavers mostly sell their products to state show rooms in local
markets whereas some opt for neighbouring states.

2 Background of the study

Pandey (1981) pointed that exact time frame when Banaras began producing silk fabrics
is unknown. However, Jaiswal (2012) investigated the varying occupational structure and
economic profile of the Textile Industry of Banaras, Uttar Pradesh by interviewing
300 adult workers working in different sectors in seventeen different factories and
300 non-textile workers. He argued that the end of the nineteenth century witnessed two
kinds of cloth being produced in Banaras one of which was kamkhwab (kincob) or
brocade, also described as ‘cloth of gold’ and resembled the silk stuffs with fine floral
designs of zari and silver threads for which Banaras silk was celebrated. The other type of
cloth was plain silk mainly used during religious and auspicious occasions.
Rani (2006) suggested that silk production which is known as sericulture is an
agro-based rural and semi-urban industry that is vastly apposite for countries like India
characterised with agriculture dominated economies and need to generate employment
opportunities for rural landless labourers. Mahan (2012) in her study linked silk industry
to tourism in India and indicated towards the potential of silk industry in reducing the
harrowing problem of unemployment by stating that Assam silk earns significant foreign
exchange growth as it is exported to countries like England, Japan, Nepal, etc., and
promoting tourism in silk industry can help in reducing the problem of unemployment in
the Assam region.
Singh and Naik (2009) attempted to explore the socio-economic condition, marketing
practices and problems faced by weavers in Banaras and posited that in order to fulfil the
demand of the consumers from several socio-economic positions, the age old traditional
Banarasi sarees have been revamped by introducing various modifications and
adaptations in the motifs, type of zari, yarn type, saree length and reed count. They
interacted with the weavers who expressed their requirements such as “provision for raw
materials at reasonable price, special training to improve existing weaving technology,
knowledge about scientific and low cost techniques of weaving, dyeing and finishing,
 Investigating distribution practices of Banarasi silk industry 215

financial assistance and other necessary inputs”. Geetha and Indira (2010) acknowledged
the prominent role of women in total production of cocoons in India and examined rural
women farmers’ political participation and political capital gained through participation
in sericulture activities.
Singh (2008) posited that although silk products have an organised market in India as
well as abroad, one of the main challenges of silk weaving industry is marketing of the
products. She listed following marketing practices prevalent in Indian silk industry:
• approximately three forth of the weavers (74%) sell silk sarees in local market and
one tenth of the weavers (11%) export silk sarees to countries like UK, Canada,
Malaysia, Mauritius, Singapore and certain African countries
• monthly sales cycle
• majority of the weavers sold their products directly to master weavers.
Singh and Naik (2009) proposed that market value of Banarasi silk sarees are not only
restricted to the host country but is present in other overseas countries as well. They
suggested initiatives like centralising the handloom weaving sector for achieving greater
consistency and constancy in the production in order to create adequate marketing
channels for silk sarees as well other diversified silk goods. They also expressed need of
advertising and publicising Banarasi silk sarees through advertisement, exhibition,
displays and trade fairs so that the variegated sarees could be showcased in co-operatives,
allied institutions and showrooms.

3 Research method

The research methods used to conduct the present study are presented in the following
sections:

3.1 Research problem

There has been a steady decline in the sale of Banarasi silk products in recent past. The
industry that once used to boast of its quality and exclusivity and commanded profit with
market share is facing a down turn. Studies found that one of the many reasons identified
was the inability of Banarasi silk industry to understand the changing market dynamics
and cope with the customers changing trends and patterns (Rai, 2010). This lead to the
need for an analysis of different dimensions of marketing practices of the industry and
suggest measures to improve the business performance.

3.2 Research objectives

The objective of the study is as follows:
a to identify the existing distribution practices of the Banarasi silk industry
b to evaluate the distribution practices of Banarasi silk industry
c to suggest measures to redesign distribution decisions of Banarasi silk industry for
marketing gains.
216 A.K. Rai and M. Srivastava

3.3 Research design

The study is descriptive and exploratory in nature. In the initial part of the study a
clarification of the general nature of the problem has been offered to give an exact
definition to the problem areas. To start with, different stake holders have been
personally visited and in-depth information on key issues has been gathered to develop an
understanding of the industry.
On completion of the exploratory part the study became descriptive in nature and an
attempt has been made to find solutions for more specific distribution issues.

3.4 Research plan

The study is divided into two parts. First part defines the problems pertaining to
distribution practices of Banarasi silk industry for which an in depth personal interview
has been conducted along with referring to the literature available on the subject.
In second part, a primary study has been conducted to evaluate the distribution
practices.

3.5 Data and sample

Data has been collected through both primary as well as secondary sources. For primary
study, in-depth personal interviews were conducted with different stakeholders as
promoters, sales people and other intermediaries of the industry. For customer related
findings, a primary study with closed ended structured questionnaire was conducted after
establishing validity and reliability of the questionnaire. The Cronbach alpha value of the
questionnaire was obtained as .78 which established the reliability of the questionnaire.
500 users of Banarasi silk products who have been identified using convenience sampling
were surveyed.
For secondary sources, available literature of the industry, industry statistics available
on concerned ministries websites and reports, many of the previous researches and other
studies and information published in newspapers, magazines, websites etc. have been
accessed.

4 Findings

Findings of the study are classified and presented into three broad sections in line with
the main objectives of the study and are as follows:

4.1 Existing distribution practices of Banarasi silk industry

A product placement exercise is done through marketing channel that performs the task
of moving goods from producers to consumers. It overcomes the time, place and
possession gaps that separate goods and services from those who need or want them from
 Investigating distribution practices of Banarasi silk industry 217

those who create them. In case of Banarasi silk products, the distribution channel is
multi-tier and contains a number of intermediaries right from raw material supplier to end
consumer. The distribution of Banarasi silk products takes place normally in wholesale,
retail and institutional forms.
1 The wholesale form: The wholesale market of Banarasi silk product is very large in
comparison to retail and institutional sale. Majority of the business gets transacted
through wholesalers. Wholesale buyers come from different parts of the country
and purchase based on their local tastes and preferences. Gujarat, Maharashtra,
Karnataka, Delhi, Bengal, etc., are the major buying centres of Banarasi silk. The
importers of the silk products meet the wholesaler and place order after inspecting
the sample provided by wholesaler. Thereafter, the wholesaler takes on the
responsibility of delivering goods at the buyers’ end. This sale is highly cyclical in
nature. At the time of festivals and marriages, the sales increase. Few of the big
sellers have their websites as well to provide general information. An important
feature of this mechanism is that many of the makers are unable to get good margins
and the real benefit is derived by the people selling at the retail end reaping the
maximum elasticity of demand. This wholesale business is largely located in the
Chowk area of Varanasi, where the sellers have got their shops or offices, popularly
called as ‘Gaddi’. This place is not very easy to commute. Traffic, parking, noise and
other infrastructure bottlenecks as electricity etc. does restrict the makers to present a
good show before the buyers.
2 The retail form: In case of retail business the wholesalers sell their product through
their own retail outlet or sell some products to the local shopkeepers as well.
There have been emergence of good quality retail stores in the city with good
product portfolio and mix of products variety and forms. Many of the big budget
manufacturers also own retail outlets in metros which they use as wholesale avenues
also. However, the organised structure of retail outlets is grossly missing.
3 The institutional sale form: Very petite attempts have been made by the marketers of
Banarasi silk industry to get an institutional ties up with big institutions, especially
with organised retail chains. This absence of a strategic relationship let the Banarasi
silk industry forego a huge market because there is a strong power of empty pipeline.
Consumer buying patterns, especially of high value purchases, have changed in the
recent past and there has been growing tendency among a significant number of
customers particularly in tier 1 and tier 2 cities to shop through organised retail
chains. Since only select few manufacturers made almost negligible efforts to
place their products at those stores, the high net worth customers are not able to
get exposed to the latest forms and designs of Banarasi silk and in case of younger
customers, the product are not tested before. There had been few tie-ups made in the
past to place the products at Shoppers Stop but somehow that broke down and since
then nothing has been done on that front.
218 A.K. Rai and M. Srivastava

So, the current status is that the institutional sale of Banarasi silk products is negligible.
One of the biggest reasons for this is that the industry structure is totally unorganised and
no one is willing to take the initiative of making it structured and organised.

4.2 Distribution practices of Banarasi silk industry: an evaluation

Marketing practices of a company or Industry are designed with the primary intention of
facilitating sales and generating sustained flow of revenue over a period of time. These
practices vary with industry.
In the current study, distribution practices of the industry have been evaluated to
assess the success from the perspective of customers. The parameters concluded upon to
base the finding has been derived out of the preliminary interview and the pilot study
conducted. The response has been rated on scale of 1–5 where 1 stands for least and 5 for
most. The point wise findings of the study are as follows:

• Problem with the existing distribution practice:

a your agreement to the statement ‘retail price difference at different retail stores
for similar Banarasi silk product is a problem’
• Satisfaction with existing distribution system:
b your satisfaction with existing distribution channel of Banarasi silk products
• Customer’s response on probable change:
c your agreement to your liking of a change in the distribution of Banarasi silk
products
d your agreement to the introduction of price regulation mechanism at retail end
e your preference to buy Banarasi silk products from an organised store than from
a conventional retail store.

1 Statement: Retail price difference at different retail stores for similar

Banarasi silk product is a problem.
Results: Mean of the response is 3.96 and the standard deviation is 1.10
Out of 500 people surveyed, 4.4% of the respondent i.e., 22 strongly agreed with
the statement that different prices of Banarasi silk products is a problem, 7.6% i.e.,
38 respondents were somewhat disagreeing, 13.4% i.e., 67 respondents were neutral with
the different prices, 36% i.e., 180 were somewhat agreeing and 38.6% i.e., 193 were
strongly in agreement with the statement posing different prices of Banarasi silk products
as a problem.
An important problem identified has been ratified by the study. Almost three-forth of
the respondents agreed with the fact that different prices being charged at different stores
are a big problem. Very less i.e., only 12% says that they do not consider this as a
problem. The above finding again brings out a need for effective check on the marketing
practices of products at retail end.
 Investigating distribution practices of Banarasi silk industry 219

Table 1 Different prices

Frequency Percent Valid percent Cumulative percent

Valid Strongly disagree 22 4.4 4.4 4.4
Somewhat disagree 38 7.6 7.6 12.0
Neutral 67 13.4 13.4 25.4
Somewhat agree 180 36.0 36.0 61.4
Strongly agree 193 38.6 38.6 100.0
Total 500 100.0 100.0

Figure 1 Retail price difference is a problem (see online version for colours)

2 Statement: Satisfaction with distribution channel of Banarasi silk products.

Result: The mean value obtained for satisfaction with the distribution of
Banarasi silk product is 3.112 with standard deviation is 1.08.
Out of 500 people surveyed, 7.8% of the respondent, i.e., 39 were highly dissatisfied
with the quality of Banarasi silk products, 21.8% i.e., 109 respondent were somewhat
dissatisfied, 30.6% i.e., 153 respondents were neutral with the quality, 31% i.e.,
155 were somewhat satisfied and 8.8% i.e., 44 were highly satisfied with the distribution
of Banarasi silk products.
There is a clear cut absence of dissatisfaction with the existing distribution system of
Banarasi silk industry. Though, it is worth noting that over 30% of the customers are not
at all satisfied with the distribution system of Banarasi silk makers.
Table 2 Distribution satisfaction

Frequency Percent Valid percent Cumulative percent

Valid Highly dissatisfied 39 7.8 7.8 7.8
Somewhat dissatisfied 109 21.8 21.8 29.6
Neutral 153 30.6 30.6 60.2
Somewhat satisfied 155 31.0 31.0 91.2
Highly satisfied 44 8.8 8.8 100.0
Total 500 100.0 100.0
220 A.K. Rai and M. Srivastava

Figure 2 Satisfaction with distribution (see online version for colours)

3 Statement: You would like a change in the distribution of Banarasi silk

products.
Result: Mean of the response is 3.71 and the standard deviation is 1.157
Out of 500 people surveyed, 6.6% of the respondent i.e., 33 were strongly disagreeing
with the change in distribution of Banarasi silk products, 9% i.e., 45 respondent were in
somewhat disagreement, 19% i.e., 95 respondents were neutral with the change in
distribution, 37.6% i.e., 188 somewhat agreed and 27.8% i.e., 139 strongly agreed with
the need of change in distribution of Banarasi silk products.
Table 3 Change in distribution

Frequency Percent Valid percent Cumulative percent

Valid Strongly disagree 33 6.6 6.6 6.6
Somewhat disagree 45 9.0 9.0 15.6
Neutral 95 19.0 19.0 34.6
Somewhat agree 188 37.6 37.6 72.2
Strongly agree 139 27.8 27.8 100.0
Total 500 100.0 100.0

Figure 3 Change in distribution required (see online version for colours)

 Investigating distribution practices of Banarasi silk industry 221

Distribution of Banarasi silk product industry is a big issue. The dissatisfaction has gone
to the extent that people have started suggesting for change in the existing structure.
Approximately 65% of the respondents voted for change and only 15% of the
respondents did not want any change. 19% of the respondents could not decide on the
suggested course of action. Hence, some initiative needs to be taken by the industry and
think over proposing a change in the distribution of Banarasi silk products.

4 Statement: Pricing regulation at retail end would help resolve pricing

problems.
Result: Mean of the response is 3.88 and the standard deviation is 1.02
Out of 500 people surveyed, 2.2% of the respondent i.e., 11 strongly disagreed with the
effectiveness of pricing regulation of Banarasi silk products for solving pricing problems,
7.8% i.e., 39 respondent somewhat disagreed, 21.8% i.e., 109 respondents were neutral
for it, 35.6% i.e., 178 somewhat agreed and 32.6% i.e., 163 strongly agreed with the
statement proposing pricing regulation as a means for resolve pricing issues related to
Banarasi silk products.
This brings forth an important suggestion for the industry. Over 70% of the
respondents are of the opinion that imposition of pricing regulation would provide a
check on the issue of pricing at retail end while less than 10% do not subscribe to the
thought.
Table 4 Price regulation

Frequency Percent Valid percent Cumulative percent

Valid Strongly disagree 11 2.2 2.2 2.2
Somewhat disagree 39 7.8 7.8 10.0
Neutral 109 21.8 21.8 31.8
Somewhat agree 178 35.6 35.6 67.4
Strongly agree 163 32.6 32.6 100.0
Total 500 100.0 100.0

Figure 4 Introduction of price regulation (see online version for colours)

222 A.K. Rai and M. Srivastava

5 Statement: You would buy Banarasi silk products from an organised store
than from a conventional retail store.

Result: Mean of the response is 4.01 and the standard deviation is .97
Out of 500 people surveyed, 1.7% of the respondent i.e., eight strongly disagreed with the
statement preferring organised store over conventional store, 6% i.e., 30 respondent
somewhat disagreed, 19.2% i.e., 96 respondents were neutral with the statement, 36%
i.e., 180 somewhat agreed and 37.2% i.e., 186 strongly agreed to having preferred
organised store of Banarasi silk products over their conventional store.
The mean of the acceptance to the concept is 80%. And over 73% of the respondents
were positive about the prospect of sale through organised retail format. All the
dissatisfaction and discomfort with the existing distribution may get checked by
organised retail chains. Such high response presents positive inclination toward the
concept of shopping from organised retail chains.
Table 5 Organised and conventional store

Frequency Percent Valid percent Cumulative percent

Valid Strongly disagree 8 1.6 1.6 1.6
Somewhat disagree 30 6.0 6.0 7.6
Neutral 96 19.2 19.2 26.8
Somewhat agree 180 36.0 36.0 62.8
Strongly agree 186 37.2 37.2 100.0
Total 500 100.0 100.0

Figure 5 Organised and conventional store (see online version for colours)

4.3 Problems with distribution decision of Banarasi silk industry

Existing distribution practices of Banarasi silk industry and the customer responses with
the marketing practices does bring forth the fact that there are specific dimensions of
distribution where ‘all is not well’. Based on the responses received and analysis of the
findings, following problems in the distribution practices have been identified:
 Investigating distribution practices of Banarasi silk industry 223

4.3.1 Distribution form issues

There is excess reliance on traditional form of distribution network. Banarasi silk product
industry is largely confined to selling to the wholesalers coming from different parts of
the country to Varanasi. They in turn sell to the retail stores in their city. The biggest
drawback of the model is that the Banarasi silk product manufacturers are deprived of the
real benefit and major chunk of the profit is reaped by these middlemen. Besides, the
trend of retail sale of fashion and high value products has also changed significantly in
the country. Emergence of the organised retail formats in clothing and multi product
outlets have increased.
The normal sales practice of the industry is that it is sold to wholesalers of big trading
centres of the country. This model leads to following marketing problems:
a Loss of superior margins: The intermediary handles the packaging and execution of
ultimate or penultimate sale. Hence, they receive real margins.
b Restricted market information: Being away from the real purchaser and user, it
becomes difficult for the makers to get the real feel of the market trends and
information of the customer’s requirements. They get confined only to the extent of
the information coming to them.
c Cyclical nature of demand: The existing model of distribution is also greatly
responsible for the abrupt nature of demand. In this reactive model of sale, the
wholesale buyers get active only when the customers start asking for the product.
The moment there is a passive response from customer, the flow of buyers gets
reduced leading to demand crunch.
d Payment issues: Issues related to payment also crop up because of the prevailing
form of sale.

4.3.2 Inability to forge strategic relations with key partners in distribution

The industry does have strategic partners, i.e., designers, fashion houses, lifestyle brands,
organised retail stores and leading hospitality players such as hotels, corporate offices,
airlines companies etc. Designers like J.J. Valaya and Sabayasachi visit Benaras in the
hot lean summer season to source fabric, give it a modern twist and take it to the fashion
runways abroad. But this is passive, occasional and unstructured. Banarasi silk industry is
still not having organised and structured tie ups with these potential partners. Exporters
have worked on this to some extent but barring very few exceptions, none of the players
are have any strategic partners on the domestic front. Relationships with designers can
prove to be hugely beneficial. Most of the today’s upper middle and higher class
customers who possess good paying capacity, buy products with designer labels. Hence,
their relationship becomes very important to leverage the market. In home furnishing
segments also, use of Banarasi silk as curtains, table cloth and other forms provides
elegance. The problem found in the personal interview held with industry people is that
the industry largely waits for the order to come to them instead of approaching the
interior designers or the company. There is hardly any strategic partner ready to provide a
big leap to the elite class for business development on a sustained basis. The industry has
224 A.K. Rai and M. Srivastava

not attempted to establish sustained relationship with organised retail. Sale to the
organised retail players like Lifestyle, Shoppers Stop, Westside and others could have
been leveraged. There is also no attempt to open there own chain of retail stores or enter
into tie ups with design houses.

4.3.3 No control over distribution

The unorganised nature of the distribution of Banarasi silk industry restricts the
government, associations or any regulator to check their behaviour with the customers.
For the same quality of products, different stores charge different prices and also offer
different quality assurances. The salesperson’s behaviour, quality assurance, physical
appearance of the store, etc., complicates the complete experience of the people with the
industry.

5 Conclusions

Marketing practices needs to be customised keeping in mind the changing trends of the
market. The numerous small players at Varanasi have not been able to come together or
pool capacity for dealing with the market or the policy environment which is responsible
for the continued decline. These small players can come together to form a big entity and
bring in technology and financial resources required to give a decisive push to the cluster
and be accountable for return on labour and working condition.
A distribution decision is done through marketing channel that performs the work of
moving goods from producers to consumers. It overcomes the time, place and possession
gaps that separate goods and services from those who need or want them. In case of
Banarasi silk products, the distribution channel is multi-tier and contains a number of
intermediaries right from raw material supplier to end consumer. The distribution of
Banarasi silk products takes place normally in wholesale, retail and. Institutional forms.

5.1 Suggestions for strategising distribution practices of Banarasi silk industry

Following recommendations are suggested for the industry for achieving sustained
success in its marketing practices:
1 Leveraging designers’ relations: Limited range of designs has been one of the
problems in this industry. Still, very limited attempt made by the industry to seek
services of professional and leading designers from the country. These designers
would not only bring in new dimensions for Banarasi silk products but also may
bring in new set of customers. They can provide the industry a vital value addition
that may help it in fetching superior premium for its products. Through collaboration
with designers, the weavers’ communities can also get exposed to modern ways of
working as well as contemporary aesthetics. The dialogues between the weavers
and the designers may result in a richer revival of the industry the region and the
country once boasted about. The Banarasi silk industry can also see this as a possible
step to transcend borders and breathe life into an old tradition. Organisations have
collaborated on the project as well by adopting weavers’ villages and working with
them to develop specific products and textiles.
 Investigating distribution practices of Banarasi silk industry 225

2 Building strategic tie ups: Strategic tie-ups with different stakeholders is missing.
There can be variety of stages of developing such strategic relationship. These
strategic relationships could be with suppliers, logistics partners, packaging partners,
channel partners and even customers. Forging strategic relationship with them
would:
a increase efficiency
b reduce cost.
These resultants would make the Banarasi silk products more competitive at the
market place. Kanjivaram silk had a tie with Indian Airlines for usage of its sarees
by air hostesses. Similar was followed by Sahara. Banarasi silk could also attempt
for such tie-ups.
3 Introducing the concept of maximum retail price (MRP): There has to have some
attempts by the industry to popularise the use of MRP among the retailers. This
would be helpful in imparting confidence among the customers. Though the model
has inherent complications of as Banarasi silk product is not entirely a homogeneous
product. The products are design-based and different designs have different cost,
time and effort. To begin with, first retail stores may be encouraged to start
practicing MRP. Subsequently, MRP may be introduced at industry level. This
would create a major transition from being an unorganised industry to more
organised and structured industry. Industry level MRP may be started with the
products that are homogeneous as silk that is sold in length largely used for men’s
kurta and shirts. Those are the products largely plain in design. Then, the home
furnishing items can also be taken up for use of MRP.
4 Introducing a regulatory mechanism for price control at retail end: Another
important step towards correcting the problems in fixing price is introduction
of some regulatory mechanism in controlling price at retail end. This would check
the ill treatment and cheating on customers. Banaras is a holy place and many of
pilgrimage come from different parts of the country throughout the year. One of
the things that are sold in good quantity is the Banarasi silk products. Deceiving the
tourists on price front results in bad reputation of not only the industry but also of the
city and its people.
5 Training the people involved in sales activity: People involved in the sales of
Banarasi silk needs to be trained thoroughly on issues related to sales and pricing in
particular. Attempt needs to be undertaken to make them realise the importance of
the customer and also on how to deal with the customer especially on the issues
related to prices and pricing.
6 Increased use of technology to optimise process and reduce cost: There are varieties
of technologies used in modern businesses to create efficiency and effectiveness in
the business. Another direct advantage of use of technology is reduction in cost.
Variety of software such as enterprise resource planning (ERP) software, customer
relationship management (CRM) software, design and accounting software are being
employed in different aspects of business and can be effectively used in the interest
of the industry. The entire supply chain management, quantity and combination
inputs requirement, their lead time, follow up of various processes, stages of output
delivery, requirements of the customers, projected demand for various product
226 A.K. Rai and M. Srivastava

segments etc. can all be managed through ERP software. Its application would not
only increase efficiency of the process but also help the industry reduce the cost.
Similarly CRM software may enable the industry to have better awareness about
their customers, their buying and buying patterns, seasonal fluctuations of the orders
and effectively be leveraged to build and sustain relationship with them. The
reduction of cost may either be used for reducing the prices of the final output thus,
leading to increment of demand or be used as a margin that may subsequently be
used for advancement of the processes, building brand of the business and sharing it
with other stakeholders.
7 Forward integration: The prices of many of the Banarasi silk products are high but
the makers in most of the cases are not the real reason and the beneficiary of this
incident. This is because the industry does not have any forward integration strategy.
Forward integration links the manufacturers with the customers. This provides
several advantages to the manufacturers. As manufacturers keep getting customers
responses to its marketing practices, they feed the business better with timely and
adequate supply of information and above all, become the master of the business in
real sense by having control over majority of the profits generated out of business.
This profit not only helps business sustain the bad times and enhance the processes
but also check any wrong doings of the intermediary. And ultimately, all these
advantages get passed on to the customers who are the real reason for existence of
any business.
8 Strategising point of purchase (POP): It has been found in the study conducted
among the buyers of Banarasi silk products that they have had the experience of
paying different prices to different retail stores. The distribution channel of Banarasi
silk products is highly traditional while the purchasing pattern of the consumers has
changed tremendously in the recent past. As regards retail sale in Varanasi, sale is
executed through stores located in the traditional narrow lanes of the specific area of
the city as Chowk, Kachori Gali, Nichibagh, Maidagin, Thatheri Bazar, etc. The area
lacks even the obvious requisites of modern shoppers like good ambience, parking
facility, nice display, professional sales people to support, etc. The net result is that
only those people come for shopping who are in serious need of purchase. Modern
purchase is hugely dependent on spontaneous purchases as modern businesses are
heavily based on dependent marketing and not need dependent marketing. Hence,
a conducive environment needs to be created to promote shoppers to come and
purchase. The other form of retail sale is through modern looking shops. But, the
quality of sales people and sales process does not conform to the standards. These
shops do take care of the ambience but fail to appreciate the importance of sales
experience which has become a necessity of modern business.
9 Establishment of service infrastructure along with retail sale: Customers were found
to be very positive towards availability of service infrastructure. To begin with,
product maintenance could be offered along with product sale. This would infuse
confidence among the customer and relieve them from the issue of maintaining the
products. Especially, in case of sales to newer region and institutions, the industry or
the government or both under public-private partnership may take some initiatives to
provide training to the staff in case of institutional buyers as hotels, offices, airlines,
etc.
 Investigating distribution practices of Banarasi silk industry 227

10 Regulatory mechanism for controlling seller’s behaviour towards customers:

Certain mechanism needs to be carved out to check the discomfort customers have
during their dealing with the retail stores. Charging different prices by different
stores selling almost similar products is a grave problem which got highlighted
very prominently in the present study. Such issue needs serious intervention as it is
associated with the image of the industry. Some regulatory mechanism is essential to
save the customers from this problem. Another direct advantage of this step would
be that the majority of the business of Banarasi silk industry would become legal and
shall operate under the close supervision of government authorities. This will enable
the government to have more appropriate idea of the malfunctioning in the business
and help it devise adequate support system for the industry.
11 Inculcation of customer centric approach among distribution channel partners: A
professional approach needs to be imparted to the sales people of the industry. There
are plenty of people who are practicing sales and marketing professionally but are
aware of only specific dimensions of this vitally important functional area such as
display, ambience, packaging etc. however, the most important factor is the store
employee-customer interface. This can be worked upon through adequate training to
the promoters of businesses to enabling them realising the need and importance of
the customer and the subsequent benefits as well as the people actually executing the
business, i.e., the employees who need to have the requisite know how of adequate
ways to deal with the customers.
12 Establishing linkage with the institutional sellers: One of the recent developments of
the changing shopping trends is shopping through organised retail stores. They do
not just cater to different needs at one place but also have put standard processes
in place for majority of customer related activities such as grievance redressal
mechanism, ambience, CRM practices, innovative pricings, wide range of offerings,
etc. Sale of Banarasi silk products through organised retail is minimal and the little
that exists is largely due to the customer pull that forced sellers to come to the
industry, buy and then sell. There has been very less efforts on part of the marketers
of Banarasi silk products to proactively promote their products. Such alliances need
to be promoted as they would manifest in:
a buy in bulk
b constant demand
c enhanced business cycle
d payment assurance
e dealing with professional with help the industry to be professional.
The present study clearly explains the need and importance of organised retailing for the
product and the benefits that may accrue to the industry. Absence of strategic relationship
with organised retail store compels the Banarasi silk industry forego a huge market
because there is a strong power of empty pipeline. Buying pattern has changed in the
recent past and the tendency of shopping through organised retail chains has been
growing among a significant number of customers, especially of tier 1 and tier 2 cities.
Since, very little attempt has been undertaken to place the products at those stores, the
customers are not able to get exposed to the latest products forms and designs of Banarasi
silk.
228 A.K. Rai and M. Srivastava

5.1.1 Other marketing decisions

1 Emphasising exports: There is a huge export market waiting to be tapped.
Neighbouring countries too like Pakistan, Bangladesh use silk clothes in their
major functions. Exporting to these countries can fetch higher margins. Apart from
neighbours, Middle East countries like Oman also use silk as their prime wearing
material as its Men’s dress which is known as ‘dishadasha’ is made up of silk purely.
But for this to succeed government has to reformulate trade strategies and policies so
that there is an open market for Banarasi silk products and the margins do not go to
the middlemen. A detailed consumer behaviour study would lead to more valuable
insights in this regard and help uplift the face of the industry.
2 Supply chain management issues: Supply chain management is extensively used
by modern marketing to optimise the process, achieve faster output with superior
quality and lesser rejection. A systematically conceived supply chain is grossly
missing in the industry. Its implementation would help the industry reduce its cost
and increase efficiency.
3 Skill enhancement through training programs:
a Sales training programs: Taking into account the nature of the industry, sales
training programs can be designed and executed by professionals for skill
enhancement and making people of the industry know the skill required for
effective sales. This will not just lead to more satisfied customers but result
into better business outcome.
b Communication training: Separate training program for improving
communication skills may also be organised. This would impart necessary
skill required to improve the efficiency of the workmen of the industry.

5.2 Limitation of the research

The study attempted to suggest strategic initiatives in distribution decision of Banarasi
silk industry. However, the findings and the suggestions are constrained with the
availability of information. The responses were also restricted to the smaller sample size
and survey location.

5.3 Future research directions

A study with larger sample size drawn from varied geographical regions may further
generalise the findings and yield more comprehensive solution. Similar studies may be
conducted for other traditional industries plagued with problems of similar nature.

Acknowledgements

The authors would like thank the two anonymous referees and editor for their comments
in the subsequent development of this paper. The responsibility for any remaining errors
rests with the authors.
 Investigating distribution practices of Banarasi silk industry 229

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