With Just 80 Rs to 6.5 Billion, Inspirational Story of Lijjat Papad
There are many inspirational stories you can find about business which started from small and humbling backgrounds to become the global success. One such success story is India’s bread making cooperative Shri Mahila Griha Udyog Lijjat Papad.
Started with a loan of Rs. 80 the Cooperative transformed into the most successful in India with a sales figure of Rs. 5.6 billion. Shri Mahila Griha Udyog Lijjat was founded in 1959 with the goal of empowering women by providing employment opportunities for them.
As of 2015, the Shri Mahila Griha Udyog Lijjat was founded in 1959 with the goal of empowering women by providing employment opportunities for them.
Shri Mahila Griha Udyog Lijjat Papad is a Women’s organisation manufacturing various products from Papad, Appalam, Masala, Gehu Atta, Chapati, SASA Detergent Powder, SASA Detergent Cake (Tikia), SASA Liquid Detergent.
The organisation is wide-spread, with it’s Central Office at Mumbai and it’s 81 Branches and 27 Divisions in different states all over India.
Lijjat Papad was born when a group of 7 Gujarati women had an idea of starting a franchise using their skill in cooking so that they could make a living. The seven women were Jayaben V. Vithalani, Parvatiben Ramdas Thodani, Jaswantiben Jamnadas Popat,
The seven women were Jayaben V. Vithalani, Parvatiben Ramdas Thodani, Jaswantiben Jamnadas Popat, Ujamben Narandas Kundalia, Banuben. N. Tanna, Laguben Amritlar Gokani and another woman whose name is not known.
These seven women then took a Rs. 80 loan from Chhaganlal Karamsi Parekh that they used to take over a loss-making papad business owned by Laxmidasbhai. They then bought the necessary paraphernalia required to make papads.
From their own building, they started with a production of 4 packets of papad. Chaganbapa becomes their advisor who told them to never comprise on the quality when they first produced cheap quality papads to sell at a low price. As we shall later see Lijjat became a household name known for quality but affordable papads.
From Chaganbapa advice the women transformed the small venture into cooperative that started recruiting women. At the start young girls could join the franchise but the age was later fixed at eighteen years. Inside three months of running as a cooperative they recruited 25 women who made papads.
Their first customers were neighbours from surrounding homes. During the first year the cooperative had to stop production for 4 months due to rains. In spite of this, they still made Rs. 6196 in sales revenue. Thanks to a wide publicity on newspapers and through word of mouth the cooperative trebled its member to 100.
This figure later increased to 300 by the end of the third year. At this point, it became a challenge for the seven founders to accommodate all of them. So the kneaded dough was distributed to members who used their homes for making papads. The papads were then sent back for the package.
It was not all going smoothly during the first years of operation. Besides stopping production for four months due to rains(which they later resolved by buying a cot and a stove) their quest of starting a branch in Sangli town and Malad, Mumbai hit a brick wall.
The franchise which was simply known Lijjat(Tasty of Gujarati) later become Shri Mahila Griha Udyog Lijjat Papad. Where Mahila stands for Women, Griha stands for home and Udyog stands for industry. After enjoying unparalleled success in the production of papads, Lijjat Papad diversified its production to include masala, khakhra, wheat atta and bakery products.
To help boost its sales Lijjat Papad took part in trade fairs and exhibitions which made their brand popular in India. The franchise also sponsored TV shows and gave away giftsto lucky winners. Due to its tremendous success and fast growing popularity Lijjat Papad started attracting global interest includeing former Uganda Vice President Dr. Speciosa Wandira-Kazibwe.
However, because of this popularity there were fake Lijjat Papads that was sold in the market by hooligan distributors. Three of them were arrested in Bihar.
Thanks to its growth and popularity Lijjat Papad started exporting 35% of its bread to countries like United States, United Kingdom, Holland, Singapore, Hong Kong and countries in the middle fast. By 2015 these export stood at Rs. 100 million.
Lijjat Papad bread uses the Sarvodaya philosophy of decentralization of power. Therefore all members are owners of the bread making company. Hence profit or loss made is shared equally among the members. To avoid incurring production losses due to poor management, production is not carried out in one centralized location but in thousands of homes.
Besides production this is how distribution cycle works. Every passing morning a group of women goes to Lijjat branch to knead dough. Other women then collect the dough and roll them into papads. The papads are then Tested for quality by another team before being packed for distribution. This simple yet very effective method also known as Gandhian simplicity has achieved tremendous success in India bringing Rs. 3.1 billion annual sales to the bread making franchise. Because of this success story in India managers around the world are looking to learn how they can apply the Gandhian simplicity.
Lijjat Papad has a committee of 21 sister members, including the President, The Vice President, two secretaries and two treasuries that oversees the day to day activites of the organisation and how profits or loss are distributed. Each branch has a committe of eleven sister members chosen through a consensus arrived at by all members. There is no male member at the institution although it has male employees with no voting rights. In addition each centre has a supervisor also called Sanchalikas that oversees its daily affairs. However every member in each centre has the power and authority to make decisions on their own initiative. Decision making process involves consensus among members for every major or minor decision and any member can nillify the decision arrived by objecting.
In addition each centre has a supervisor also called Sanchalikas that oversees its daily affairs. However, every member in each centre has the power and authority to make decisions on their own initiative. Decision-making process involves consensus among members for every major or minor decision and any member can nillify the decision arrived by objecting.
Today Lijjat Papad is considered as one of the most successful business venture that is own by women for women empowerment. It helps women not willing to work outside their homes to contribute to family income.
Because of how it values its people it has developed a sustainable business model. With its ever growing market thanks to quality affordable products in addition to a rapid expansion it is safe to say that the future of Lijjat Papad can only be brighter. The fact that it is tailor made for women has helped it gain traction with most women.
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