Bespoke Retailing…..Shruti Yadav
Sakhi Retail is helping companies customise their products to the needs of rural India, and empowering the locals.
Sakhi Retail is helping companies customise their products to the needs of rural India, and empowering the locals.
In 2005, a team of young entrepreneurs descended on Maharashtras Osmanabad district and fanned out across several of its villages. Their mission: to conceive and design an energy-based product customised to the needs of the rural areas poor. One of the organisations driving on the entrepreneurs was the learning and development organisation Swayam Shikshan Prayog (SSP), a known and trusted face in the region.
Today, its Sakhi Retail network is quietly transforming the lives of rural folks, equipping them with energy-efficient devices, while also empowering many women in the area, who are its saleswomen.
Among the products that SSP has helped customise are the ChotuKool, a mini-refrigerator made by Godrej and Boyce, and Oorja, a stove that BP Energy co-created with the villagers. Both products were developed after extensive consultations with people in Osmanabads villages. Take the case of the Oorja, for instance. With the help of SSP and another NGO, Covenant Centre for Development (CCD), BP Energy executives began meeting with the locals to ascertain their needs. They realised there was a need for a product that could replace smoky and soot-filled cooking using firewoodthe people required a cheap, non-smoky alternative. The result was the Oorja stove, designed by students of the Indian Institute of Science, Bangalore.
The stove was designed and re-designed several times after being tested by the locals. Its body was changed from steel to ceramic, fuel burning time extended from 30 to 75 minutes and a liquefied petroleum gas (LPG) component entirely done away with. The end result was a product that cut fuel costs by up to 40%. In addition, thanks to smoke-free biofuel, it made for healthier homes. The fuel was developed especially for the stove, in the form of pellets. It is made from agri-residue such as groundnut and cotton husk and sugarcane waste.
After the co-creation came distribution and sales. Again, rural women were involved from scratchcreating awareness, taking orders, delivering the stove. CCD and SSP formed Adharam Energy, which became BPs exclusive partner in selling the Oorja stove and fuel. But in 2009, SSP broke away from Adharam to form its own distribution network, Sakhi Retail.
Far And Wide
It decided to branch out into more areas and sell more products to rural and semi-urban customers. The network relies on an army of Sakhis (friends) to sell the products. A year on, the Sakhi Retail network operates in 650 villages and has 850 Sakhis on its payroll. In addition to the ChotuKool (cost: Rs 3,790) and Oorja (Rs 950 upwards), it now sells solar lights, water purifiers and water heating systems, too.
The Sakhis either get orders and place them with the company or buy products and sell them to the end customer. The latter enables them to earn substantially more. Pranita Prayag, 32, who was a housewife, has been a Sakhi (friend) for the last four years and is part of the small but growing network. She sells products worth around Rs 15,000-20,000 every month and earns up to Rs 1,500. Though she has been bargaining for better commissions, she appreciates the independence and mobility the job has given her. Today, Prayag can look after her household for most of the day, going out when it suits her to educate people and sell the products.
Prema Gopalan, Director, SSP, says the task the company has set itself is to create a market where none exists. This entails educating people about products that can improve their living standards. Demonstrations, promotional booths at village fairs, posters and drawings are all part of this exercise. It helps that SSP has been involved with these villagers for over 15 years. The one-to-one relationship, while increasing trust, also leads to high expectations. Sakhi Retail tries to live up to these by providing constant feedback to the manufacturers, so that consumer requirements can be incorporated into product designs.
However, even as its stable of products expands, the element of co-creation has declined. That there is a need for it is evident from the fact the Oorja stove is still the networks best-selling product. It has sold over 64,000 of them, while the response to other products has been slow.
But, as Gopalan explains, Sakhi Retail is now focusing more on getting some much-needed appliances to the people of rural Maharashtra. Thats understandable, as distribution lines are very thin in the area. For example, when Hindustan Unilever introduced its Pureit water purifier, it had few people and a phone-in facility in place to take orders. And none of this extended to the lower end, until Sakhi Retail entered the picture. It quickly spread awareness on the importance of purifying water and is creating demand for the product.
Gopalan also insists that Sakhi Retail isnt giving up on co-creation. It is now looking at creating products for farmers to improve their productivity and income. The only condition is that the products need to be environment friendly.
But though the NGO is ready, a change in the mindset of the corporates is required. As Gopalan says, it requires a partnership between the social and private sector to make products affordable while connecting them with peoples aspirations.
Whats in it for the private sector? A lot, says Mukund Deogaonkar, Director of First Energy, the company that took over the rights to the Oorja stove when BP Energy exited the Indian market. In five years, over 470,000 Oorja stoves have been sold across the country, and 14,000-18,000 tonnes of fuel is sold annually. Thats a record to hearten any entrepreneur. The path has been beaten, it just needs more people to walk down it now.
* Sakhi Retail provides constant feedback to the manufacturers, so that consumer requirements can be incorporated into product designs.