Serving the Poor

Profitably

Group Members:
-Han, Mingyi
-Joseph, Kim
-Liu, Ying
-Zhou, Shiyi
-Zhu, Qingqing
OUTLINE
Lijjat Papad’s company background

Company’s motives for choosing the poor as the target market

Innovative Strategies implemented by the company

Ways to sustain its profitability

 Ethical to view the poor as producers
instead of consumers

 “Best way to alleviate poverty is to

raise the income of the poor and to
emphasize buying from the poor
rather than selling to the poor”
(Karnani, 2007, p. 102).
 Even “the University of Michigan
management lecturer argues that
if the poor are treated with dignity,
empowered and seen as
innovators, there’s a fortune to be
made” (Tripathi, 2005).
 CHECKLIST
“Create opportunities for steady
employment at reasonable wages
01 is the best way to eradicate
poverty” (Karnani, 2007, p. 104).

Provide jobs to the poor instead

02 of mainly viewing them as
consumers (Karnani, 2007).

Empowers low - skilled employees

03 (WIPO, 2015).
Shri Mahila Griha Udyog Lijjat Papad
● Shri Mahila Griha Udyog Lijjat Papad is a Women’s
Organization, founded in 1959 (Lijjat, 2018a).

● Main objective of the organization: Empower women

by providing jobs, which will allow them to earn a
decent income and in return help increase their
standard of living (Lijjat, 2018b).
● Organization’s initial operations started in Bombay
(currently known as Mumbai) (WIPO, 2015).

● Only consisted of 7 women (Lijjat, 2018c).

● Had no capital to start their operations and so Lijjat

Papad initially worked with borrowed money
amounting to Rs. 80, which they loaned from
Chhaganlal Karamsi Parekh (Lijjat, 2018c).
● Organization initially
succeeded due to the sale
of Papad (WIPO, 2015).
 Products
● Papad
● Masala
● Gehu Atta
● Chapati
● Appalam
● Detergent Powder
● Laundry Soap
 Increasing their production capacity (WIPO, 2015)
 Gaining more members (WIPO, 2015)
 Purchased equipment necessary for production
(WIPO, 2015)

Organization grew by:

 82 branches and about 45,000 members across India
(Lijjat, 2018b).
Motivations
Affordability
Geographic Behavioral

Demographic Sociographic

Lijjat Papad India’s per capita income

Small Size 100 gm in 2017
25.00 Rupees ≈ $0.50 $7.00 per day
Consumption Pattern
QUANTITY CONSUMED PER YEAR FREQUENCY OF USE
1-2 kg 3-4 kg Above 5kg Occasionally Frequently Daily

Above 5kg 8%
9%

3-4 kg
24% 27%

1-2 kg 65%
67%

(Kamat et al., 2008)

“The women empowerment is not a
one-time affair but a continuous
process.” (Purswani, 2017)
 Women’s empowerment
● Women’s organization (of/by/for the women)

● Improving women’s economic and social status

● Promoting family welfare

Innovative
Strategies
1. Home-based employment opportunity

● No machinery, manual production process

● Take the kneaded flour home to make papads
● Regular free buses transport
(Pardeshi, 2018)
1. Home-based employment opportunity

● Developed three main divisions of labor：

- Processing units
- Packaging teams
- Distribution sections
● Raise income and look after their children
(Pardeshi, 2018)
2. Employees' compensation & Collective ownership

● Day payment service (by cash)

● Depends on the total kgs of papads rolled;
meet the quality standards
● Extra payments e.g. on cultural festivals
(Pardeshi, 2018)
2. Employees' compensation and Collective Ownership

● Distribute the profits and losses equally

● Steady income with additional benefits
(Pardeshi, 2018)
 Collective Ownership
 Main principle of the institution

 Industrial assets by all member-sisters for mutual benefit (Collions English Dictionary, 2012)

 Own the enterprise

 Share the profits/losses

 Merge of ownership & membership

 Encourage uniform & sustain organizational growth

(Malathi Ramanathan, 2004; Bhatnagar, Rathore, Torres, & Kanungo, 2010)

 Voluntary Organization
● Any woman (irrespective of caste or religion)

● Become a member by signing a pledge of devotion

● Commitment to earn 'legitimate' honest income

● Renouncing of membership

● No one could be asked to leave (unless/until she goes against the organizational

principles)

(Bhatnagar, Rathore, Torres, & Kanungo, 2010)

Employee benefits
Does not accept donations, but provides help to the needy.

● Education
- classes for practical skills training
- opportunity of attaining literacy while working
- provide scholarships and awards

● Poor health
- preventative healthcare programs (community projects)
● Loan
- regular provision of loans with no interest
- without specifying the reasons

(Pardeshi, 2018; Malathi Ramanathan, 2004; Bhatnagar, Rathore, Torres, & Kanungo, 2010)
 Employee benefits
● Business & development strategies

- gained financial independence

- improved the prospect of a better life

● Establish new model for community development

● Poverty reduction

● Become a winner of multiple awards

(Pardeshi, 2018)
Profitability
 Does the company make profit?

01 Stable Growth From 2007 - 02 Small reduction from 2007 03 The profit is increasing
2015, it reached 250 million to 2008 overall
Rs at 2015 Chart Source: Gender Equality and Women Empowerment -- A Case of Lijjat Papad, Pune.
 Profit Trend Analysis

STATISTICS REASONS
36% decrease 1. Fluctuation in raw
from 2007 to material price
2008 2. Competition from
other brands

TREND IMPLICATION
The overall profit Lijjat Papad is a
is increasing every potential company
year and major
increase is 44%
Chart Source: Gender Equality and Women Empowerment -- A Case of Lijjat Papad, Pune.
 OBJECTIVE PROBLEMS RECONMENDATIONS RESULTS

Water The final products are

Build the Quality
Quality tested in Lijjat’s laboratory

Get a stove
Choose with a
other emerging
Monsoon
cover to help sister
markets Build the Space
Season
Can Lijjat members to dry the papads
Papad
der
sustain
profitability? Strong Build the Brand
Increase in advertising
Competition

Export Appointing its own

Issue distributors for Build the Channel
exporting
REFERENCES
Ahmed, J. U., Sultana, H., & Ahmed, A. (2018). Patanjali Ayurved Invades India. CrossMark, pp. 75-91.

Bhatnagar, D., Rathore, A., Torres, M. M., & Kanungo, P. (2010). Empowering Women in Urban India: Shri Mahila Griha Udyog Lijjat Papad. Indian Institute of Management.

Collins English Dictionary - Complete & Unabridged 2012 Digital Edition. (2012). collective ownership. Retrieved from Dictionary.com: https://www.dictionary.com/browse/collective-ownership

Kamat, S., Yenagi, N., & Naganur, S. (2008). Consumption pattern of papad at household level and its availability in the local market.. University of Agricultural Sciences, 22(2): (399-403)2009. Karnataka, India.

Karnani, A.(2007). The mirage of marketing to the bottom of the pyramid: how the private sector can help alleviate poverty. California Management Review, Vol. 49(4), 90 – 111.

Lijjat.(2018a). About us. Retrieved from http://www.lijjat.com/Organisation/AboutUs.aspx

Lijjat. (2018b). Brief information. Retrieved from http://www.lijjat.com/Organisation/BriefInformation.aspx

Lijjat. (2018c). The beginning. Retrieved from http://www.lijjat.com/Organisation/TheBeginning.aspx

Purswani, N. (2017). Role of Shri Mahila Grah Udyog in women empowerment. J.W. Sadhubella Girls Degree College, Ulhasnagar 421001, Vol.2(3), 55 – 60.

Pardeshi, S. (2018). Gender Equality and Women Empowerment– A Case of Lijjat Papad, Pune. Retrieved from http://www.ica-ap.coop/sites/ica-ap.coop/files/Shefali%20Pardeshi%2C%20India1.pdf

Tripathi, S. (2005). Profiting from poverty. Retrieved from https://www.theguardian.com/business/2005/jan/07/ethicalbusiness.india

WIPO. (2015). Pappadums and the path to empowerment. Retrieved from http://www.wipo.int/ipadvantage/en/details.jsp?id=3619

Yadav, R. (2017). Patanjali Ayurveda Limited: Attraction of Ayurveda Products. South Asian Journal of Business and Management Cases, pp. 100-108.
Q&A