Case- 2

Bee-keeping of Saharanpur, U.P

Bee-keeping is best suited to Indian climate since bees collect honey from local flora including
agricultural crops. Whole world has placed important place to bee-keeping since it is labour
intensive and low investment industrial activity with high rate of returns. In the developing
countries, it is flouring since large flora and vegetation makes it a successful business enterprise.
It is assumed that per bee colony 20-40 kg of honey in a year may be collected. An entrepreneur
in California can easily manage 1000 bee colonies through mechanical devices. The fact remains
that North America, USSR, England, European counties, Australia, New Zealand etc., are
practising bee-keeping as business enterprises, while South America, African and Asian
countries are still in the earlier stage of production process.
Bee-keeping is mainly concentrated in three development blocks namely Nakur, Gangoh, and
Rampur Maniharan in Saharanpur district. There are about 300 bee-keepers in these blocks.
About 90 per cent bee-keepers are active. Mr. Ajai Saini and Tanjim could be considered as
pioneers to start bee-keeping in Saharanpur. In 1991-92 KVIC started financing bee keeping.
This was further promoted by IRDP scheme in 1994-95 and 1995-96. The two main factors
contributed the growth of bee-keeping in this area namely abundance of flora and trading
network. About 3 years before, there were about 8000 bee-keepers in above mentioned three
blocks. Due to adverse weather, bee-keeping could not turn out to be good. Three beekeepers
have more than 1500 colonies each. Majority of the units are self-financial while during 1994-95
and 1995-96 about 2000 bee-keepers were financed under IRDP and TRYSEM schemes. There
are 6 traders engaged in bee-keeping and a large number of registered societies are engaged in
bee-keeping.
Annual income of bee-keepers has computed Rs. 1.31 lakh. During 1997-98 to 1999-2000
production of honey and wax has increased by 7.11 per cent. Per bee-keeper, average number of
colonies has been found 196. Average investment per bee-keeper has been found to be Rs. 7.41
lakh. Cost of production has declined sharply by 40.45 per cent during three years. Average cost
of production was reported Rs. 3.48 lakh in 1997-98 which declined to Rs. 2.37 lakh in 1999-
2000. About 40 per cent of sales is the profit. Average worker per bee-keepers was reported to be
32. Market has expanded. Largely bee-keepers sell their products locally to big buyers of
Saharanpur. Now some have started exploring markets in big cities and metropolitan cities.
Dabur also locally purchases honey from bee-keepers. The main problems in bee-keeping are
reported to be (i) lack of technical knowledge about queen rearing; (ii) lack of quality in
extraction and storage of honey; (iii) lack of knowledge regarding diseases control and rearing
bee-queen; (iv) limited marketing scope; (v) poor maintenance colonies; (vi) limited availability
of raw materials; (vii) increasing competition with substitutes; (viii) high cost of production; (ix)
lack of marketing intelligence etc.
Questions
1. Give a SWOT Analysis of bee-keeping of the district.
High barrier to entry
Highly experienced owner-operate
Limited competition
Very high gross margins
Ability to sell products online
Highly visible website
Limited start up risk

Weakness
Competitors can offer similar products quickly
Limited startup cost
High transporation cost
Limited flexibility in pricing

Opportunities
Continued expansion for online sales
Ability to develop additional stores

2. Discuss the problems in marketing context and suggest a suitable marketing plan.