Bagmari, Ultodanga, Bhaghajatin are slum areas in North & South Kolkata - populated with several thousand enterprising, independent micro-entrepreneurs.Vegetable vendors who buy Rs.1500 worth of vegetables every day from wholesalers and sell it at a net profit of Rs. 150-200 per day.
Egg vendors who procure 1000 chicken eggs per day at approximately Rs. 2500 and sell for a net profit of Rs. 160 per day.
A family of potters who procures the clay for Rs. 6000 per truck - that lasts them 15 days, making 1000 small Diya's (earthen lamps) per day. The family earns a net profit of around Rs. 200 per day for the sale of these Diya's. Everyone in the family works on this.Small stitching units that produce hosiery vests, children's clothes for the local markets - producing up to 50 dozen sets with a 2-3 member stitching team. Net profit per day for the business owner approx Rs. 350 per day
These are micro- entrepreneurs. Each running simple, very relevant local businesses - providing for their families through the business and in some cases also providing jobs to a few more.In studying this ecosystem, we found some interesting initiatives that are keen to formalize this section of entrepreneurs - and create more economic and capability impact.
For example an enterprising News Service has been initiated in this area of Kolkata for the last 2 years to build a flow of news that can enable these micro entrepreneurs to share knowledge and build capacity - and therefore increase incomes. Supported by an international News Agency, that is keen to further the impact of News in disadvantaged communities - this project publishes a local newsletter distributed to the micro entrepreneurs.
Printed twice a month, Amar Khabar is populated with stories of success, little tips on new business ideas, info on loans - all collated by 'young citizen journalists' from within the same micro-entrepreneur communities.
In its 24th edition when I met the team in March 2010 - this newsletter now reaches 102000 entrepreneurs within north and south Kolkata, free. With a validated database of 5000 readers, the team is now putting all efforts behind building a strong repository of reader data - such that more specific inputs and info can be provided - and the black box of 'who are the micro-entrepreneurs' can be opened.
Its a valiant effort at somehow formalizing the information, learning and knowledge flow for entrepreneurship - within a highly fragmented, disorganized and dynamic community.
Impact?
Meet Gopa Bhattacharya, a middle aged serial entrepreneur who runs a small eatery, makes Bindi's for local women, and makes and sells an odd assortment of simple products.
She read an article in Amar Khabar that provided tips on how to make and sell solar lamps. She went to Barabazaar, got all the key parts needed, made her first solar lamp 2 months ago. She now makes and sell 5 such lamps each week. For a profit of Rs. 200 per lamp. In the last 8 weeks she has augmented her income by Rs. 6000 by building a completely new product line! This reiterates the power of knowledge. Make it accessible. And the enterprising person will find a way to use it and flourish.But for Gopa to grow beyond this, she says she needs the obvious - market access. As a woman she cannot travel beyond her community - but she knows that at her price point she can produce a lot more by hiring a couple more people - but where can she sell it?
More income would mean more 'poonji' that can be generated (working capital), which would mean lesser loans from money lenders and MFIs. But how does she get access to markets?
So at Version 1.0 - This News project has succeeded in demonstrating the immediate potential of this idea. But for large scale impact the 'Gopa effect' has to be wide spread and critical mass of real financial impact created in the micro entrepreneurs business. Either top line - or savings in costs or new product lines...and several of these.. Repeatedly you hear the request for a MARKET for the products. "Find us a market, connect us to the markets....we will find a way to produce more..."
The fact is that the producer will need to find his/ her own market. But what or who can facilitate that? What's the capability needed for that?
Should version 2.0 of such a Newsletter go beyond 'Knowledge & Capability' and become more of a bridge between the sellers and the buyers maybe? The reader base needs to include both sellers and buyers, producers, aggregators and consumers. Clearly the newsletter would need to shift its paradigm - from providing access to News to becoming a platform and interface for business impact - powered by relevant knowledge and strong database of active readers.
There are around 1.5 - 2 million such micro entrepreneurs in Kolkata. Even at a price of 0.50 paise per successful connection between seller and buyer, A Newsletter could find ways to be sustainable. At a low cost of Rs. 1 per edition that helps build the capability and provides learning to its readers...it could be more sustainable. Combine that with SMS coverage to a dedicated subscription base - and access for whole sellers...more sources for generating funds to stay alive.
The innovation challenges to building version 2.0 of such a News Service?
- How to institutionalize the 'Gopa process' of enterprise and risk taking across a larger community?
- Making content creation a far more collaborative effort - can mobile phones be leveraged to collect, write and collate news and content?
- How to build a knowledge chain that meaningfully links producers, consumers, buyers, sellers - in a manner that direct economic impact is possible to measure?
- Can this be a 'lifecycle' engagement for micro entrepreneurs - or should it be limited to providing connects and news
- How can available technology be integrated across the network - mobiles phones, field devices already used by large FMCGs in these markets, local phone booths.
But to make them sustainable - what's needed is to build the next level of solutions if real impact has to be brought to economy and life in India...that's where innovation is needed. To go beyond the prototype.
If you know of some well scaled models that focus on increasing the economic success of micro-entrepreneurs and use technology and business models for this - do pls write in. Would be great to study and learn from them. Will help cut the curve immensely!
Another interesting news service I learnt of - HIBR.me in Lebanon.
Nice article Parvathi!
ReplyDeleteI worked on a market survey to identify a similar need-gap in the micro-entrepreneur space. Went and met a lot of NGOs, Govt bodies working with them; their biggest need too was market linkages, how to connect them with markets as they grow
some other challenges that emerged along with that, though, were the need for a certain amount to standardization as their market grows. As a consequence of that, things like quality control and consistent supply (and hence linkages for imputs supply too) also become important.
I shall watch this space for more on this to read what you discover as a possible solutions to market access.
Entrepreneurs differ greatly by sector, a software entrepreneur will have different interests and incentives than a restaurant entrepreneur.'' The YES Movie '' produced by Louis Lautman
ReplyDelete@ Development - yes, that's true of course. Entrepreneurs differ greatly by sector, investment type, ambition... This post focuses primarily on what we understand as micro-entrepreneurs, with really small businesses, many have revenues under $5000 a year and are a fragmented and dis-advantaged group since they don't fit into the regular 'format' of high-earning entrepreneurs that most institutions recognize...
ReplyDelete