Project Report

On Shri Mahila Griha Udyog Lijjat Papad Submitted by Group members:(a) Priyanka Bhagwat (b) Kunjal Bhanushali (c) Tejashree Borkar (d) Prajakta Dalal (e) Sneha Gharat (f) Vijay Kasbe (g) Sujay Vijayan 7404 7405 7409 7412 7426 7444 7448

SYBMS Semester- IV Academic year 2008-2009 Project Guide: - Mrs. Seema Thakur Submitted to: - University Of Mumbai Parle Tilak Vidyalaya Associations Mulund College of Commerce Mulund (West) Mumbai-400080

Declaration
We, Priyanka, Kunjal, Tejashree, Prajakta, Sneha, Vijay and Sujay students of Mulund College of Commerce studying in SYBMS hearby declare that we have completed project on Shri Mahila Griha Udyog Lijjat Papad during academic year 2008-09. The information provided is true and original the best of my knowledge.

Date:Place: -

Signature of students

Certificate
I Professor Mrs. Seema Thakur do hereby certified that Priyanka, Kunjal, Tejashree, Prajakta, Sneha, Vijay and Sujay are students of Mulund College of Commerce and has successfully completed their project on Shri Mahila Griha Udyog Lijjat Papad during academic year 2008-09. The information provided is true and original to the best of my knowledge.

Signature of Principal Signature of Project guide Signature of external examiner

Acknowledgement
We take this opportunity to extend our profound sense of gratitude and heart felt appreciation to the following persons for their guidance at all stages of our project. We would like to thank them for their suggestions during development of this project and also for taking out time from their busy schedule. Finally we would like to sincerely thank all those who are directly or indirectly involved in this project.

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Signature of Students

Introduction Be it an evening stock, or a banquet or a meal at home, the papad finds its due place on the dining table. No Indian meal is complete without it, and Indias biggest papad success is undoubtedly, Lijjat. Everyone enjoys rags to riches stories and everyone likes tales of success achieved through sheer determination. The story of Shri Mahila Griha Udyog Lijjat Papad is all that and much more. Shri Mahila Griha Udyog, the makers of the famous Lijjat papad, is an organization which symbolizes the strength of a women.Only women can become the members of the organization Shri Mahila Griha Udyog has a wide range of papad, khakra, vadi, masala, atta, bakery products, chapati, appalam and detergents. It is registered under the Khadi and Village Industries Commission (KVIC) Act. The KVIC is a statutory organization established in 1956 by an Act of Parliament. It place a pivotal role in the strengening of rural economy by promoting and developing Khadi and Village Industries. The Beginning It all began on 15th March, 1959 which was a warm summer day. In Girgaum, Mumbai, a group of seven ladies gathered on the terrace of a building and started a small inconspicuous function. The function ended shortly, the result was- the production of 4 packets. As the days went by, the addition to this initial group of 7 was ever increasing. Started with a modest loan of Rs. 80, these women took its turnover from Rs.6196 in the furst year to Rs.300 crores in the next few decades, involving over 40,000 women on its revolutionary march. Their vision was clear- an exclusive womens organization, run and managed by them, a quality product that these women had the expertise to make, an finally a work environment which is not competition driven and mechanized but based on pure labour and love for the organization and its people. Lijjat is today guised by separate divisions of advertising, marketing, sales promotion, and exports and there is greater coordination between branch offices. How does it work? After a woman has signed the pledge signed, which serves as a formal entry and introduction to the formal working environment, and she is considered as a sister member. The branch office normally operates from 6.00a.m to 10.30a.m during which some women prepare the dough, while others receive ready papads from those who had taken the dough home, the previous day. Payment, called vanai charge, is made straight away, before fresh dough is given for the days work. Accounts are never kept pending even for a day nor is any credit given to a dealer no matter how big or important he is. Every branch is headed by a Sanchalika (branch head) who is chosen from among the women members by consensus. Apart from production, the branch is also responsible for marketing its products in the area allotted to it. The wide network of dealers and the goodwill that Lijjats products enjoy with customers make the marketing relatively easy. To maintain the high quality and standard of Lijjat products and uniformity in taste for the same product from different branches,the central offices supplies the raw material- moong and urad flour. If there is any loss, women members, as the owners of Lijjat enterprise, absorb this by taking less vanai charges. Similarly profits are distributed among the women members as extra vanai charges.

Management

President Jyoti J. Naik Vice - President -Smt.Kamal D.Dhandore Treasurer - Smt.Sharda S.Landge Treasurer -Kum. Pratibha H. Trilotkar Secretary - Smt.Malti M. Pawar Secretary - Smt. Sunanda R.Belnekar
Manufacturing Process Sale of Papad amounts to about 45% of total sales. Hence, we have studied the production process of Papads. The manufacturing process for making papad starts at 5:00 a.m. everyday. All the sisters or bhaginis are fetched from their homes at brought to their respective production centers in institutional vehicles. These sisters who arrive at 5:00 a.m. are responsible for kneeding the papad dough. After 7:00 a.m. the rest of the sisters come in and dough is distributed to each one of them in dabbas. These sisters take the flour to their respective houses, roll out papads and place them in the sun for drying. It is extremely essential that the papad once rolled gets a sufficient number of hours per day to dry in the sun and that is the reason that the entire process is initiated at 5:00 a.m. Every morning when the sisters come to work, they bring with them the rolled out papad of the previous day. Only on giving this in do they receive dough for the next day. From every 1000 gms of the dough, the weight of the final papad will amount to only 800 gms. From every 1000 gms of dough, 120 small papads of 5 inches each and 65 papads of 7 inches each can be rolled out. For 1 kilogram of papad rolled out, a sister earns a pay of Rs 16/-. For any faulty papad rolled out, a penalty is charge to the sister amounting to a few paise.Most of the centers carry up to 15 days inventory.The sanchalika of each center ensures that there is no wastage or pilferage by counting the papads that are bought in each day. From 8:00 to 9:00 a.m., the packing process takes place. The packing bags are manufactured by Lijjat itself, so as to maintain high standards and quality. This is also done to prevent duplication of their product, which could occur if this process was outsourced. Quality of the product is of utmost importance. If a slight defect is identified in a days production, then the entire production will be destroyed. To maintain standard and assured quality, the purchase of raw materials is carried out by a central authority. The main raw material, Udad dal, is bought and processed in Nashik and Vashi. This is then transported to the Mumbai Head Quarters and then channelised to various centers across the country as per their requirements.

Product line

Papad (Five flavours: lasan, moong, mirch, Punjabi and urad) Khakhra Appalam Masala Vadi Gehu Atta (Wheat flour) Bakery products Chapati

SASA Detergent Powder ,SASA Detergent Cake (Tikia) ,SASA Nilam Detergent Powder ,SASA Liquid Detergent
Lijjat's manufactures several products, of which the papad is the most famous.

Promotions
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 their annual expense on advertisements and promotions amounts 1% of total turnover. The extremely famous Bunny rabbit campaign continues to be aired on specific regional channels. For e.g. Alpha Gujarati, Alpha Bengali, Sun etc. 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. Should they exceed this target; the distributor will receive a further 1% discount. Quality: We proudly claim 'consistently good quality' to be our USP. From the moment a new member joins, she is repeatedly told to make quality her mantra. At the training session, bens are taught to make the 'perfect' Lijjat papad. And every member has absorbed the concept totally. It is evident in the fact that even without modern machines, every consumer of Lijjat papad, wherever she is, gets the same consistent quality of papad. How? Because every ben rolls the papad to the same specification and every lot of papad goes through testing. If we find any ben becoming careless about quality, we do not tolerate it. We give her a warning, then the option to take up any other work like packaging, testing, etc. and if she still displays a lack of concern for quality, we ask her to leave the organization. Out of one kg dough, we must get at least 800 gm (accounting for loss due to moisture, etc), otherwise we cut pay. We get papads for testing from all centers everyday and if we find any deviation from our quality, for example, if the salt is less or more, etc, we immediately intimate that particular centre to destroy the entire lot, even if amounts to a million rupees worth of production. Out of this strong belief in quality delivered at an affordable price comes our act of ignoring competitors. Lots of companies selling papads have come and gone. We don't consider them; we only do our own thing. We do not take into consideration what the competition is doing. We know that if our quality is good, consumers will buy. Our quality does not differ whether it is for exports or for the local market. There is just one quality. And that's good quality. Again and again and again!
Distribution channel The distributor pick up quantity of papad they require and pay cash on delivery because they pay their bens (members are called bens) everyday. Lijjat have an estimate of the quantity each distributor takes, they produce accordingly. This ensures that they neither stock inventory nor pay heavily for storage. Lijjat have about 32 distributors in Mumbai. Each distributor picks up an average of 100 boxes per day from the depot. This where their job ends. They are not involved in how and when a distributor delivers as long as he stays within the area they have marked for him.

Generally each distributor has tempo and about 8-10 salesman to deliver outlets within his territory. Selection of distributor 1) To select a distributor, they first give an advertisement in newspaper for the areas they have marked. 2) Members from the marketing division go personally go and check the warehouse facilities and only their approval the distributors are appointed. 3) Distributor pays Lijjat Rs.1,50,000 as deposit. 4) It is made clear to them that they must pay on delivery if they want Lijjats distributorship. This system is followed all over India. 5) When Lijjat discovered that there is demand in particular place, they open a new branch like recently opened in Jammu & Kashmir. For example, Lijjat donot have any centre in Goa, but they have appointed a distributor for that area to ensure that Lijjat papads reach Goa. 6) Lijjats communication distributors are regular through monthly meetings where they discuss their problems and also the issues that Lijjat may have about quality, price, reach etc. 7) Lijjat donot have individual door to door salesman or woman selling from home. There is only the appointed distributor for the area.

Driven by values : Every member who joins in pledges, ". . . we will make all-round effort to ensure that the bens get real fruit of their labour and we will not allow to happen any type of economic loss to the Institution knowingly, unknowingly, directly or indirectly. We are aware that it is one of the very important traditions of our Institution that neither sister-member nor employees take away wrongfully any money or material from the Institution. Those who take away money or materials wrongfully from the Institution are either beggars receiving alms from the bens or thugs and robbers extricating bread from a sister's mouth." Among others, the chief value that holds the institution firmly is a sense of

self-dignity and respect. They discourage any kind of class distinction and do not declare ourselves as an organisation for poor or needy women. Their thinking is straight. Theirs is a business like any other even if the structure is different. There is no place for feelings of pity, sympathy or charity among members.They also do not accept donation or charity of any kind, even if voluntarily offered. They do believe that this has helped the organisation retain independence and brought quick growth. It has given us a clear vision of the path of progress. Maintaining proper accounts has always been on our agenda. When they started out, Chhagan Bapa, their mentor had advised them to maintain accounts daily. Even today, every branch closes the account book every day. They do not want to get into monetary hassles because of badly managed accounts. There is no place for prejudice on the basis of caste or religion, and democracy in its truest form is encouraged. Following these values ensures that they run and perceive as a serious business, not a charity organization. Valuing people: Their beginnings were modest. Seven women with no special skills but a strong determination to earn dignity as individuals went ahead to make a successful business, doing what they knew best -- rolling papads. They leveraged their basic skill and turned it into a weapon because they believed in themselves and in each other. And that's how they function even today. They believe in each other, in each other's ability and commitment to take the institution towards progress. It is this belief that has been the basis of our business model as well. They understand the family, time and social pressures women face every day. What they have done is simply to turn these into an advantage and not an excuse. It serves everyone. Lijjat helps these women who are not encouraged to work outside their homes, to contribute to the family income. Their bens take dough home and roll them into papads when they are free from their domestic chores. At the same time it is not prudent for the organization to invest in office property for so many members. The perfect fit for both is using the members' homes for the rolling and drying of papads. No additional overhead costs, no investment either. Valuing people and under-standing their problems has created for Lijjat a sound and sustainable business model. However, though it would make business sense to adopt modern technology for mass production or use machines for packaging, etc, they haven't done so because it would defeat the very purpose of their existence, which is to provide a source of livelihood and dignity to women through selfemployment. In addition, they have one vehicle per branch, which, at fixed times, brings the bens and rolled papads to the branch and also drops them back. This is done for all the bens -- those who mix the dough, do the vanai (rolling), testing, packaging, etc. Organization structure

Exports

Lijjat papad has earned reputation not only in India but also in every corner of the world. At present 3035% of Lijjat papad is being exported in countries like U.S., U.K., Middle East, Singapore, Hongkong and Holland. They do not export during monsoon season, they sell only locally. It goes on Lijjat papads brand but as soon as the product is deliverd for export the responsibility of Lijjat papad is over and exporter takes initiate to market and sell the product but if any problem occur it goes with Lijjat name and they are there to solve the problem. Exports alone accounts for Rs. 10crore (Rs. 100 million). They are not directly involved in exporting but recognized professional merchants exporters (who also exports other food products) place and export orders. Only on receiving the full advance through a cheque then only they began production because all exports are done from Mumbai, the supply also comes from Mumbai. Export production of the same quality as daily production. In fact, they send same of the daily production for export. Challenges The central office of Lijjat in Mumbai previously co-ordinated the activities of all the branches, but with the increasing number of outlaying branches, authority was decentralized in terms of routine work and sharing of profits at the branch level. However, branches and Sanchalikas still need the managing committees approval prior to undertaking any new project or activity and they all must follow the same set of instructions and have similar accounting systems. Inspite of the equal distribution of income among the member sisters, with the opening of more outlaying branches; it was found that a few branches dominated the administrative process. The central office appealed to members to participate in the administrative process, as a duty to the organization and a right. The members, if found practicing mismanagement, are relieved from membership. Because the papads are prepared in different parts of India, the quality of the water used usually varies, and so the quality of the final product also varies. 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 also discussed. Currently there is a problem of fake Lijjat papads being introduced in the market. In June 2001, three persons were arrested in this connection in Bihar, but the threat exists in the global market also. Lijjats website (http://www.Lijjat.com/new.htm) tries to explain the identification features of original Lijjat papads but even with technological advancements, it is difficult to guarantee the original product. Besides papads, Lijjat has initiated some unsuccessful ventures such as cottage leather, matches, and agarbatti( incense sticks). However, by the end of 1978, Lijjat had flour mills, spices; printing, polypropylene divisions of its own and in 1979 began manufacturing bakery products as well. In 1966, Lijjat was recognized under the Khadi and Village Industries Act, and it obtained exemption from income and sales taxes and could get loans at lower interest rates. Currently, the state governments of Punjab and Mumbai have withdrawn the sales tax exemption on Lijjats SASA detergent because Lijjat has already grown into a sizeable organization. These can potentially obstruct Lijjats growth in these states. The President of Lijjat urged the state governments to reconsider their stand during her speech at the Economic Times awards. Social Responsibility Beginning as it did on the principles of trusteeship, it naturally followed that the member sisters made it a policy to return a little of what they had gained, back to the community, as a share in their earnings, either in cash or in kind. Also, they used their organization as a medium to promote their and their families welfare, by increasing the availability of health care, by providing scholarships for their

children who showed promise in their studies and by cooperating to build houses and promoting their own bank. It was a multifaceted policy that contributed much to raise their own image and that of the organization in the eyes of the society. Social responsibility towards society 1. One of the most creditable work undertaken by the Lijjat was the rehabilitation in Chincholi (Jogan), the earthquake affected village in the Latur district of Maharashtra. The institution provided the finance and supervised the work of construction of 58 houses for the people of the village. 2. In 2001, after earthquake in Kutch, Gujarat, Lijjat built 40 houses for the rehabilitation of the people of Bhujpur, (Bhachau) in Kutch. It spent 49 lakhs of rupees, obtained as contributions from the several branches. 3. In the Valod centre, Gujarat, the very first branch of the organization, they set up an educational and hobby centre to provide the rural women, who lived there, to acquire new skills. 4. The first ever pucca (tarred) road in Valod to be built and inaugurated in 1979 was with the help of the Lijjat, Valod branch. 5. Lijjat gave Rs.25 lakhs to Chief Minister Fund when Tsunami occurred for Tsunami victims. 6. When Bihar suffered with flood and many people lost their lives. Lijjat gave Rs. 5 lakhs to Prime Minister Relief funds. Social Responsibility towards Employees 1. Give scholarships to children of employees or women working. Initially it was given to 60% or more but now they have scholarships ever for children securing 40%. 2. Medical facilities are provided to women. Regular checkups are conducted for women by a doctor appointed. 3. In the year 1999, Lijjat was started an education program for its members (women) who make papads and they made it compulsory for every women to learn to write an read for 15 mins when they come to the branch and then resume work. This thing proved useful as all the ladies where able to sign any documents on which they initially used to leave thumb print.