Mr.rajasekhar ITC

8/12/2019 Mr.rajasekhar ITC

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AGARBATTI BUSINESS

Sustainable Livelihood & Community Development

Hyderabad, December2010


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Sustainability Challenges

Rest

India

33 %

India is home to 33 % of global poor

Mostly resident in Rural India

Population Figs in Millions, Source : World Bank

Under $ 1.00 Under $ 1.25 Under $ 2.00

267( 24 % )

456( 42 % )

828( 76 % )


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ITC - Corporate Social

Responsibility

ITC believes that an effective growth strategy for

our nation must address the needs of rural India,

home to 75% of our people


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ITC Country Before Corporation

Livelihood to over 5 Mn people

Globally recognised e-Choupal initiative.

Choupal Saagar -Rural hypermarts

Social and farm forestry ->100,000 hectares

Carbon,Water and Waste recycling Positive

Sustainable Community Development.


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Publications

ITCs 7th Sustainability Report

is under publication as perthe G3 Guidelines of Global

Reporting Application Level A+

-- the highest level

ITCs Sustainability Report


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Connectivity through Lead Farmer

6500 e-Choupals cover around 40,000 villages benefiting 4 million

farmers

Customised Extension Services

Weather Information

Price Discovery

Market Access at Farm Gate

ITCs e-Choupal Solution


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ITC Businesses

FMCG

,

Paper &

PackagingHotels

Agri

Business

Information

Technology


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FMCG Incense Sticks & Safety Matches


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Agarbatti Industry Overview

Hand crafted by cottage industries and NGOs in India

India Market Size- T/O of Rs 2400 cr 70 Bn sticks

Bamboo 35,000 mts/annum

Rawbatti 60,000 mts/annum

Growing at 10% p.a

Exports- Rs 275 cr

Use of Incense

India Worship

Overseas - Ambience creation

- Aroma Therapy


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Highly Fragmented Industry

MARKET PRODUCTS

Highly Fragmented

200 players with

400 brands

Industry dominated

by Local Players

Top five players

account for 20%value

Top five pack /

price combinations

account for only25% of the industry

Large number of

fragrances are

marketed

Agarbatti Industry


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Mangaldeep was launched in 2004 and currently is the No. 2

National brand in the country

Mangaldeep has an All India market share (value) of 6 % of

with monthly sales of over 350 Mn sticks

Mangaldeep has 25 SKUs at 10 price points

The business provides livelihood to over 9000 people

The business partners with 15 small and medium enterprisesto bring out the best of their entrepreneurial skills and facilitatein raising their process and quality standards

About ITCsAgarbatti Business


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Delivering on Triple Bottom Line

Economic

Mangaldeep-No 2 Brand

Impressive Growth

Depth in Distribution

Brand Building

Environmental Livelihood for > 9000 people

Exemption- Excise Duty & VAT

6/15- ISO-9000 certified Vendors

Social

Training programs Munger, Agartala, TN, Karnataka, AP

MOU with Ministry of Govt ofOrissa,Tripura etc

Case Study:

ITC Limited and the

Agarbatti Industry


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IFAT-International Fair Trade Association, Head quartered in

Netherlands

Network of organisations that work to improve the livelihoods and

well-being of disadvantaged producers

Members-Producers, co-operatives or associations, exporters,

importers, retailers

Cottage Industries-Pondicherry-Recieved membership

approval

Great Advantage for Exports to US and Europe


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NGOs

SSIs

Charcoal

Raw Batti

rolling

Jiggat

Perfuming

Packaging

Bamboo

Marketing &

DistributionITC Ltd

ITC Incense Business Value Chain

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IT Enabled Quality Statistics

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Vendor

locations

Data By E Mail to centralized location

1. Process control data

2. Absorption of Fragrance

3. Physical attributes data

4. Finished goods clearance data

Data Analysis13

Vendor

locations

Feedback report to the vendor

1. Process Capability

2. Likely defects above and below specs

3. Six Sigma metrics for all parameters combined

4. Warning messages & Corrective actions


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Marketing Approach

Developing brand preference

Superior fragrance experience (Conforms to IFRA norms)

Consistently superior product experience

Inputs for Priority Markets

Attractive & differentiated packaging Fragrance locked

Product Quality rating Systems

Brand Health Tracker

A superior fragrance development and selection procedure

1. Leveraging existing Nation wide distribution of ITC

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Blessings

From

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ITCs Strengths

Nation-wide distribution

2 million

outlets

Brand building- Indias two largest

brands

Supply chain management and training

module

Extensive R&D for product

development.

Meeting Consumer needs through

Research

Agartala

Pondicherry

Chandigarh

Coimbatore

Bangalore

New Delhi

Kolkata

Hyderabad

Manufacturing

Locations

Vendor locations


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NGOs - Strengths

Understanding the social milieu in rural India

Ability to interact with rural women and win

their trust

Wide reach into Indias rural heartland

Managerial skills to implement and monitor a

commercial project


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Synergies Combine

ITC NGO

Brand Building

Quality

Reach

Sales

Employment

"Small Opportunities are Often theBeginning of Great Enterprises."


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Raw Incense NGO Based Supply Chain

ITC Ltd /

VendorsNGO

Womenin

Different

Villages

Spread

over and

of morethan 100

Sq. Km

Order Raw Material

Supply

Finished Goods Brought

Back

Supplies

ASHA


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ASHA

Assistance in Social Habilitation through Agarbatti

Start up support provided by ITC Training to workers

Use of IT infrastructure to monitor the progress.

Prices bench marked to competition-No subsidies

Over 1500 women trained in rolling of incense sticks

Initiatives by NGOs-SEWA,AOL,ORMAS etc


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Operation Harvest

Bamboo is a integral part of the Incense Stick

Indias bamboo growing regions are segregated from the rest of the country

because of lack of infrastructure and extreme poverty

ITC is working with Forest Dept. in South India and North East in a unique

sourcing programme

ITC facilitates in training the tribals to produce bamboo sticks for incense

Helps move the tribals up the value chain Guaranteed buyer and payments


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MOU Signing with Govt of Orissa

Rolling of Incense sticksacross Orissa

Availablity of Bamboosticks

Impart training andFacilitate procurement ofraw incense

Rural employmentopportunity to 3000women

SO


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ISO-9001-2000

Agartala


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Endorsements


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The Context and Agenda Identify a Product that has Mass Consumption

Develop /Involve NGOs & SHGs for manufacture.

Seek assistance from Govt/Agencies

Provide inputs to produce Quality Goods

Scaling up Plans to be defined clearly

Tie up with a corporate for Marketing/Distribution

Review Progress periodically

Transforming Lives and Landscapes Ensuring a Sustainable Future


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Transforming Lives and Landscapes Ensuring a Sustainable Future

Thank you !
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Mr.rajasekhar ITC

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