1.

A PROJECT REPORT ON WOMEN’S CO-OPERATIVE SHRI MAHILA GRIHA UDHYOG

LIJJAT PAPAD (RECOGNIZED BY KHADI & VILLAGE INDUSTRIES COMMISSION)”
SUBMITTED BY Yogin Vora MBA Projects PROJECT GUIDE
2. EXECUTIVE SUMMARY SHRI MAHILA GRIHA UDHYOG LIJJAT PAPAD, popularly known as
“Lijjat”, needs no introduction. Lijjat is woman’s organization manufacturing different products of
village industries, having its central office at Mumbai. Lijjat is spread all over India. It has 69
centers and 31 divisions in different states. In 1959, Girgaum, Mumbai Shri mahila griha udyog
Lijjat Papad made a beginning under the blessing of Shri Chhanganlal Lkaramshi Parekh
popularly known as ‘Pujya Chhaganbapa’ who was a member of the servants of India society
and a highly successful social worker. In 1996 it was recognized by the khadi & village industries
commission under the chairmanship of Pujya Uchhangral N. Dhebar. A deeper insight by the
report shows Lijjat’s achievements and services renders to the society and how it has help the
Indian economy to grow tremendously in the past few years and in the tears to come. What is the
reason for its success? The working of the organization, management future plans. Lijjat is the
story of a business house that has created wealth for a nation and the story of pioneers like
Pujya Chhaganbapa, Pujya Uchhangral N. Dhebar.
3. Table Of contents SECTION 1 LIJJAT IN GENERAL ¬ INTRODUCTION ¬ HISTORY ¬ THE
BEGINNING ¬ AWARDS HISTORY SECTION 2 BASIC PRACTICES & PHILOSOPHY ¬ BASIC
THOUGHT ¬ THREE GOLDEN RULES ¬ PHILOSOPHY THAT GUDIDES LIJJAT SECTION 3
¬ CULTURE ¬ ROLE IN WOMEN EMPOWERMENT
4. SECTION 4 ¬ ORGANISATION STRUCTURE AND MANAGEMENT ¬ HOW THE SYSTEM
WORKS SECTION 5 ¬ PRODUCTION & PACKAGING PROCESS ¬
DIVETDIVETRSIFICATIONS SECTION 6 ¬ MARKET POSITIONING ¬ ANALYSIS SECTION 7
¬ CHALLENGES AND POTENTIAL ¬ CONTRIBUTION TO SOCIAL SERVICE ¬ PHILOSOPHY
5. SECTION 8 ¬ PROBLEMS FACED BY LIJJAT PAPAD &THEIR SOULTION ¬ FACTORS FOR
SUCCESS SECTION 9 ¬ CONCLUSION ¬ BIBLIOGRAPHY.
6. SECTION 1 Introduction Be it an evening snack, or a banquet or a meal at home, The Papad
finds its due place on the dining table. No Indian meal is complete without it, and India’s biggest
‘Papad’ success story is Undoubtedly, Lijjat. Everyone enjoys ‘rags to riches’ stories and
everyone likes tales of stupendous success achieved through sheer determination. The story of
Shri Mahila Griha Udyog Lijjat Papad is all that much more. Shri Mahila Griha Udyog Lijjat
Papad, popularly know as “Lijjat”, is an Indian women’s organization manufacturing different
Products of village industries. The organization’s registered office is Situated in Mumbai and it
has 69 centers and 31 divisions on different states. Lijjat is spread all over Indian. Stared in 1959
with a capital of Rs. 80, Lijjat today has a Annual turnover of around Rs.315 crore (Rs. 3.15
billion), with Rs.12 In exports and has around 42,000employees. Lijjat is primarily a cottage
industry, urban by its origin, that has spread to the rural areas. It is considered as one of the
most remarkable enterprenual initiative by woman that is identified with women empowerment in
India. Lijjat shows how an organization can infuse Gandhian simplicity in all its activities.
7. Shri Mahila Griha Udyog Lijjat Papad is registered under The KVIC Act- (Khadi & Village
Industries Commission) The Khadi and village Industries Commission (KVIC) is a statutory
organization established in 1956 by an Act of parliament. It plays a pivotal role in the
strengthening of rural economy by promoting and developing Khadi and village industries. The
main objectives of the KVIC include skill improvement. Providing employment in rural areas, and
transfer of technology, rural industrialization and promoting self-reliance among the people and
to build up a strong rural community base. The functions of the KVIC are generally to plan,
promote, organize and assist in implementation of programmers for the development of Khadi
and village industries.
8. HISTORY Lijjat Papad is a women’s organization of the women, by the women and for the
women. It was stared in 1959, Girgaum, Mumbai with 7 lady members of the residential
tenements of “Lohana Niwas” gathering on the terrace of the building for a function by rolling 4
packets of papads and the decision to make papads, everyday. Thus Shri Mahila Griha Udyog
Lijjat Papad made a beginning under the Blessing of Shri. Chhanganlal Karamshi Parekh
 popularity Known as ‘Pujya Chhanganlal’ who was the member of the Servants of India society
and a highly successful social worker. He was a noble man gifted with down-to-earth ideas. The
turning point of the institution came in 1966 when then Chairman of Khadi & Village Industries
Commission Pujya Uchhangral N. Dhebar visited the Institution and got it recognized by the
Khadi & Village Industries Commission it was also registered under Bombay Public trust Act
1950 and also registered under Societies Registration Act, 1860. The Objective of the institution
is to provide employment to the ladies to enable them to earn decent and dignified livelihood.
Any women can render physical work in this institution without distinction of caste, creed and
color and agrees to abide by the Institution can become a member of the Institution from the date
on which she starts working. Every branch is headed by a Sanchalika to see the production of
the branch. There is Central managing Committee consisting of 21 members out of, which there
are 6 elected Office Bearers i.e. President, Vice- President, 2 Secretaries and 2 Treasurers.
Another important fact about the Institution is that a male person cannot become its member and
any male employee whether working honorary or on Salary basis has no right whatsoever over
Institution. All the branches are autonomous units for the purpose of profitability and the profit or
loss as the case may be of such unit is borne by the owner sister member of that branch by
increasing or decreasing her rolling charges accordingly. The credit for rapid progress
9. goes to the constant vigilance on the part of sister members maintaining the quality of Lijjat
Papad with their hard work. Besides Lijjat Papad the institution has other products like Khakhra,
Masala, and Vadi, SASA Detergent Powder & Cakes, Bakery Products, Liquid Soaps, Gehu Atta
& Chapattis. At present it has 69 centers * 31 divisions in different states and gives, self-
Employment to about 42000 sister member all over Indian. The sales which have amounted to
only Rs. 6,196/- in the first year. i.e.1959 have already touch the level of Rs. 300 crores which
includes Rs. 12 crores of exports. Lijjat Papad has earned reputation not only in Indian but also
in every nook and corner of the world. The worldwide demand for crisp and alluring Lijjat Papads
always keep growing. At present about 30 to 35 percent production of Lijjat Papad is being
exported. The main consumer countries include U.K., U.S.A, Middle East and also in Singapore,
Honk- Kong, Thailand Holland, Australia, Europe, Japan & and other countries.
10. The Beginning It all began on 15th March 1959 which was a warn summer day with the sun
shining brightly in the cloudless sky. A majority of the women inhabitants of an old residential
building in Girgaum (a thickly populated area of South Bombay), were busy attending their usual
domestic chores. A group of seven women gathered on the terrace of the building and started a
small inconspicuous function. The function ended shortly, the result production. This pioneer
batch of 7 ladies had th bait rolling. As the days went by, the additions to this initial group of 7
was ever-increasing. The institution began grow. It the early days were not easy. The institution
had its trials and tribulation. The Faith and patience of the member were put to test on several
occasions –they had no money and started on a borrowed sum of Rs. 80/- Self-reliance was the
policy and no monetary help was to be sought ( not even voluntarily offered donations) so work
started on a commercial footing. Today, Lijjat is more than just a household name for ‘Papad’
(India’s most popular crispy bread). Started with a modest loan of Rs 80, these women took its
turnover from Rs 6,196 in the first year to Rs 300 crore in the next decades, involving over
40,000 women on its revolutionary march. Gandhian business strategy, equally well executed by
his followers, late Chhanganlal Karamshi Parekh and Damodar Dattani, who worked tirelessly
from behind the scene. Their vision was clear – an exclusive women’s organization run managed
by them, a quality product that these women had the expertise to make, and, finally, a work
environment which is not competition – driven and mechanized but based on pure labour and
love for the organization and its people, Lijjat is today guided by separate divisions of advertising,
marketing, sales promotion and exports. There is greater coordination between branch offices
(different production and marketing units) and centralized marking, advertising and exports
departments. The cooperative now has annual sales exceeding Rs 301 crore (Rs 3.1 billion).
What’s more stunning than its stupendous success is its striking simplicity. With quality
consciousness as
11. the principle that guided production, Shri mahila Griha Udyog Lijjat Papad grew to be the
flourishing and successful organization that it is today. PIONEERS OF SHRI MAHILA UDYOG
LIJJAT PAPAD
12. Awards History The Institution has received an award from Khadi & Village Industries
Commission as a “Best Village Industry” for the period 1998-1999 to 2000-2001. On 6th
September 2003 the institution received the Economic Times award of “Businesswomen of the
Year 200-2002 for Corporate Excellence”. In January 2003 it received the award for “Best
Village” at the hands of Hon’ble Prime Minister Shri Atal Bihari Vajpayee at new Delhi.
13. On 21st December 2005 institution has received has received the “Brand Equity Award at the
hands Hon’ble President of India, DR.A.P.J Abdul kalam presented by PHDCCI at VIGYAN
BHAVAN, New Delhi.
14. SECTION 2 Basic thoughts 1. It is a voluntary organization of sisters. 2. The organization is
neither for the poor sisters nor for the rich ones-poor Sisters should remove the thoughts of
poverty from should their mind and the rich sisters remove thoughts of their affluence. 3. It never
accepts charity or grant. 4. It believes in running the business wisely and with practice good
business ethics with dealers and consumers. 5. The organization strictly observes the practice of
maintaining the the accounts regularly, writing the books daily and preparing balance sheets
every month. 6. The organization is like a family and sisters run it as if they all belong to the
same family. 7. The organization is like a revered place of worship. 8. No one can change these
basic thoughts of the organization. Three Golden Rules Besides basic principles like self-
reliance, co-ownership and faith in dignity of labour, the institution has also formed three ‘Golden
Rules’ 1. All the rights of the institution must belong to members only. 2. There must be
maintenance of “Lijjat” quality at any cost. 3. There must be clean and time bound accounting
system.
15. Philosophy that guides ‘Lijjat’ Shri mahila Griha Udyog Lijjat Papad is synthesis of three
different concepts, namely: 1. The concept of Business. 2. The concept of Family. 3. The concept
of Devotion. All these concepts are completely and uniformly followed in this institution. As a
result of this synthesis, a peculiar Lijjat way of thinking has developed therein. The institution has
adopted the concept of business from the very beginning. All the dealings are carried out on
sound and pragmatic commercial footing quality goods and sells them at reasonable price. It has
never accepted nor is it ever going to accept any charity, donation, gift or grant from quarter. On
the contrary members donation collectively for good causes from time to time. Such as
construction of houses for Earthquakes affected families of Chincholi- Jogan (Latur) & Bhujpur,
Kutch etc. Besides the concept of business the institution has adopted the concept of mutual
family affection, concern and trust which are the ‘idée fixe’ of the members. All the affairs of the
institution are tackled on the very same pattern as a family carries out its own daily household
chores. But the most important concept adopted by the institution is the concept of devotion. For
the members as well the employees and the well wishers, the institution is never merely a place
to earn one’s livelihood. It a temple, a church, a mosque, a gurudwara, a place of worship to
devote one’s energy not for his or her own benefits but for the benefit of all. In this institution
work is worship.
16. SECTION 3 Culture Lijjat Patrika, the in-house magazine, is published and circulated for a
nominal rate to those interested in the activities of Lijjat. It is publish in many languages,
including English, Gujarati, Marathi, and Hindi. It has emerged as a strong mode of
communication for information related to significant events and initiatives at Lijjat, in addition to
presenting articles on women. Member sisters across all branches of Lijjat recite an all religion
prayer before beginning their daily activities. The sisters are free to choose their activities and
each activity is given equal importance. Leaving the organization is voluntary. No member sister
can be asked to leave unless or until she goes against the organizational principals. There is no
fixed retirement age at Lijjat. Once, when the president Jyoti Naik was questioned about this
anomaly, she said that there was no need to make provision for a retirement age, as the
emphasis obviously was on earning one’s bread through daily work, all through one’s life.
Because of Lijjat’s main motive of generating self- employment for women, no machinery is used
at the production level, and everything is done manually. However, computers are now being
used in some of Mumbai branches for accounts and administration.
17. Role in women empowerment The growth of the Lijjat is often seen in the larger canvas of
women and their empowerment. The organization has undertaken various efforts to promote
literacy and computer education for member-sisters and their families. A literacy campaign for
 sisters began through literacy classes at Girgaum on June 18, 1999. Later, the managing
committee decided to start such class in all its branches from 1980 onwards, Lijjat started giving
Chhaganbapa Smurti Scholarships to the daughters of the member-sisters. The member-sisters
used their organization as a medium to promote their and their families’ welfare. In the Valod
centre they set up an educational and hobby centre for the rural women. Orientation courses in
typing, cooking, sewing, knitting, and toy making as well as other courses like child welfare, first
aid and hygiene were taught. The first ever pucca (tarred) road in Valod to be built and
inaugurated in 1973 was with the help of the Lijjat, Valod branch. In 1979, Lijjat teamed up with
UNICEF to organize a seminar in Mumbai on “child Care and Mother Welfare”, as part of the
International Year of the child celebrations. In October 1984, Bhadraben Bhatt representation
Lijjat at the UNISCO sponsored international workshop on “The role of women in the assimilation
and spread of technological innovation” held at NITIE, Powai. Alkaben Kalia represented Lijjat at
the National level meeting on women convened by National Commission on Self Employed
Women. At the behest of Mother Teresa, the member-sisters also took part in some activities of
Asha Dhan, an institution to care for destitute women. Lijjat member-sisters also tried to start a
co-operative bank, but the effort was not very successful.
18. Key elements of Empowerment Information With increasing business and other advances, the
need for information dissemination and communication among member sisters at various
branches has increased. The monthly regional meetings, annual general meetings, and all -India
conventions of branches are held to keep the members aware of organizational activities and
strategies, and to discuss issues such as quality activities and strategies, and to discuss issues
such as quality maintenance, production rates, the handling of accounts, and everyday problems
to assure a better work environment. Lijjat Patrika, the in-house magazine, is publish and
circulated for a nominal rate to those interested in the activities of Shri Mahila Griha Udyog. Lijjat
Patrika has emerged as a strong mode of communication for information related to significant
events and initiatives at Lijjat, in addition to presenting articles on women. Initially most sisters
were uneducated, but realize the important of education for their children, especially daughters.
Lijjat offers scholarships for these children to encourage better performance in studies. A literacy
campaign for sisters also began through literacy classes at Girgaum on June 18, 1999. at first, it
was explained that a literate woman can read or write a letter, maintain a bank accounts, pay
bills, teach her children, assist her husband in his work, and live independently. Later, the
managing committee decide to start such classes in all its branches. Besides other interactive
and information-based activities, participation in various trade fairs and exhibitions held across
India contributed to the popularity of the Lijjat brand. Such participation also builds self-
confidence, through exposure and training opportunities, for the member sisters who play a
significant role in the overall functioning of Lijjat.
19. Key elements of Empowerment The combination of inclusion and the active participation of
women have endured as Lijjat’s backbone for 43 years. The interests of all sisters are treated
equally, because they sisters from the Lijjat family. Any woman, irrespective of her religion,
caste, or class, can become a member after signing a pledge of devotion, which is her assurance
for earning an honest income through cooperative work. Member sisters across all branches of
Lijjat recite an all-religion prayer before beginning their daily activities. The sisters are free to
choose their activities, such as making the masala (blend of multiple spices), pounding the flour,
weighing the flour, preparing the dough, rolling papads, receiving papads after weighing,
checking the papads, packing the papads, distributing wages, and handling the accounts. Each
activity is given equal importance, and sisters perform these activities with mutual cooperation
and consent. When a new branch of Lijjat opens, a neighboring Lijjat branch helps it by guiding
and training new members. Leaving the organization is voluntary. No member sister can be
asked to leave unless or until she goes against the organizational principles. Because of Lijjat’s
main motive of generating self-employment for women, no machinery is used at the production
level, and everything is done manually. However, computers are now being in some of the
Mumbai branches for accounts and administration. Any sister can apply for a loan from the
organization without specifying the reasons. As well as acquiring some financial independence,
women have also realized the importance of social independence. Because women own the
organization, lower-middle- class women find it very comfortable to work in such an environment.
20.  Accountability Lijjat presents an explicit example of organizational accountability. The
managing committee members are selected from the member sisters on the basic of common
consent. Any member sister can express her interest to be a managing-committee member and
be selected after due procedure. The discussions are held openly, and decision powers lie in the
hands of the sisters who are present on that day. A single member’s object can nullify the
decision of the whole group. A member can ask an employee to quite without specifying the
reason, but no employee can ask a member to quite. However, a member can be asked to quite
by another member (or members) if found be involved in false practices or misconduct. Account
books are easily accessible, ensuring transparency in Lijjat’s working. Lijjat follows its own
financial accountability principle; for instance, there is only a 0.5 rupee margin between the
production cost and selling price of a 200-gram Papad pack. There is a “piece rate” system, and
sisters are paid on the basis of the number of papads they roll. There is no credit method for
running operations in the organization. Every payment is done on a daily basis, except for the
outside supply of raw material. In the initial days of Lijjat, the profits of the first six months were
shared equally among all sisters in the form of gold. This sharing practice is still in effect, but now
the decision whether to share the profits in gold or in cash is made at the branch level. Profits
and losses are shared equally among the members of a given branch. The cost of national- level
advertising is borne by all branches and divisions, depending on their individual production
abilities. The polypropylene division provides money for advertisements and recovers it through
additional charges on the bags that it supplies to the branches and divisions across India.
21.  Local Organizational Capacity Lijjat became a formally complete organization by the seventh
year of its existence, and afterward was recognized as a public trust. Initially, Lijjat’s activities
were limited to the former Bombay, but in 1966 it started to establish centers in neighboring
urban areas, followed by branches in other states such as Gujarat, Andhra Pradesh, Punjab, and
Madhya Pradesh. After continued success and phenomenal growth during the last four decades,
Lijjat has been able to make its presence felt worldwide. A number of people, including officials
from countries such as Israel, the United Kingdom, Sri Lanka, Sudan, Iran, and Uganda, have
visited India to see Lijjat’s methods of operation. They occasionally promote similar organizations
in their own countries. When they started their venture, the seven women were determined not
expect donations or help from anyone to run the organization, even if they suffered losses. This
practice has become financially sound after establishing itself in the market through consistent
quality in its production. Lijjat has emerged as an organization that not only denies any donations
from other parties, but also provides help to the needy. For instance, after the earthquake in
Gujarat in January 2001, all the branches of Lijjat gave a total donation of more than Rs 4.8
million, including Rs1 million from the central office. There are a number of other such instances
that have contributed to enhancing the self-esteem of the member sisters.
22. SECTION 4 Organization Structure and Management In order to ensure that the working of the
trust was professional, an organization structure and certain professional guidelines were put in
place. Member-sisters owned the enterprise. Any women, irrespective of caste or religion willing
to work in any capacity could become a member by signing a pledge of devotion to the basic
tenets of the organization. It was a commitment to earn legitimate honest income thought wok on
a co- operative basis. Six Offices - Bearers 1. Smt. Jyoti J. Naik - President 2. Smt. Pratibha E.
Sawant - Vice-President 3. Smt. Sunanda R. Belnekar - Secretary 4. Smt. Swati R. Paradkar -
Secretary 5. Smt. Priyanka G. Redkar - Treasurer 6. Smt. Sheetal S. Koyande - Treasurer
23. Lijjat believes in the philosophy of sarvodaya and collective ownership. It accepts all its working
members as the owners and an equal partaker in both profit and loss. The members are co-
owners and fondly referred to as "sisters". All the decisions are based on consensus and any
member-sister has the right to veto a decision. Men can only be salaried employees
(accountants, drivers or security guards), and not the members of the organization (i.e. they are
not the owners). The running of the organization is entrusted to a managing committee of twenty-
one members, including the President, the Vice-President, two secretaries, and two treasures.
Sanchalikas are in-charge of various branches and divisions. The office bearers of the managing
committee and the sanchalikas are chosen from among the member-sisters on the basis of
consensus every three years. Each branch has a committee eleven member-sisters, again
chosen by consensus. The central office at Mumbai previously coordinated the activities of
various branches. But, as the organization grew, the authority was decentralized in terms of work
 and sharing of profits at the branch level. However, the sanchalikas still need the managing
committee's approval before they undertake any new project or activity. All the branches follow
the same set of instructions and have similar accounting system. To co-ordinate various
branches in a region or state, there are branch coordination committees and area meetings of
various branches in a state. The annual general meeting is attended by member-sisters
representing branches and divisions all over India. Currently, Lijjat has branches in seventeen
Indian states -- Andhra Pradesh, Bihar, Delhi, Gujarat, Haryana, Jharkhand, Jammu and
Kashmir, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Orissa, Punjab, Rajasthan, Tamil
Nadu, Uttar Pradesh, and West Bengal. Account books are easily accessible to all the member-
sisters, ensuring transparency. Lijjat follows its own financial accountability principle. There is no
credit method for running operations in the organization. Every payment is done on a daily basis,
except for the outside supply of raw material. Profits and losses are shared equally among the
members of a given branch. In the initial days of Lijjat, the profits of the first six months were
shared equally among all sisters in the form of gold. This sharing practice is still in effect, but now
the decision whether to share the profits in gold or in cash is made at the branch level. The cost
of national-level advertising is borne by all branches and divisions, depending on their individual
production abilities. Because of Lijjat's main motive of generating self-employment for women, no
machinery is used at the production level, and everything is done manually. However, computers
are now being used in some of the Mumbai branches for accounts and administration.
24. The quality of papads can vary due to quality of water used in various parts of India. To avoid
any inconsistencies, the final products are tested in the Lijjat's laboratory in Mumbai. In the
monthly meetings, the quality issue and modifications are tested. The central office purchases
and distributes all ingredients to maintain the quality of the final product. For example, the urad
dal is imported from Myanmar, asafetida is imported from Iran, and black pepper comes from
Kerala. The committee often makes surprise visits to various branches to assure that production
conditions are hygienic. When a new branch of Lijjat opens, a neighboring Lijjat branch helps it
by guiding and training new members. On successive failures of a branch to abide by the
organization's philosophy of consistent quality and production of papads, the central committee
reduces the daily wages of its members by 1 rupee. The member-sisters are also rewarded for
extra effort. For instance, in 2002, the member-sisters at the Rajkot branch received Rs 4,000
each as bonus, while the member sisters at Mumbai and Thane branches received a 5-gram
gold coin as an incentive. Several issues of Lijjat Patrika enumerate the names of the
names/numbers of the member-sisters, who were rewarded with the cash or gold, for their extra
efforts.
25. How the system works The entire cycle starts with a simple recruitment process. Any woman
who pledges to adopt the institution's values and who has respect for quality can become a
member and co- owner of the organization. In addition to that, those involved in the rolling of the
papads also need to have a clean house and space to dry the papads they roll every day. Those
who do not have this facility can take up any other responsibilities, like kneading dough or
packaging or testing for quality. Packed papads are sealed into a box (each box holds 13.6 kg)
and the production from each centre is transported to the depot for that area. Mumbai alone has
sixteen branches and six depots. Each depot stocks production from the nearby three to four
branches -- roughly about 400 boxes. In some smaller towns or villages, the branch itself serves
as the depot. The depots are our storage areas as well as pick up points for distributors.
Distribution flow chart
26. Their distributors pick up the quantity of papad they require and pay cash on delivery because
they pay their bens (members are called bens, or sisters) every day. Since they have an estimate
of the quantity each distributor takes, they produce accordingly. This ensures that they neither
stock inventory nor pay heavily for storage. They have about 32 distributors in Mumbai. Each
distributor picks up an average of 100 boxes per day from the depot. This is where their job ends.
They are not involved in how and where a distributor delivers as long as he stays within the area
they have marked for him. Generally each distributor has his three-wheeler and about eight to
ten salesmen to deliver to retail outlets within his territory. To select a distributor, they first give
an advertisement in newspapers for the areas they have marked. Members from their marketing
division personally go and check the godown facilities and only on their approval do they appoint
distributors. A distributor pays them Rs150,000 as deposit. They make it clear to them that they
 must pay on delivery if they want our distributorship. This system is followed all over India and it
works well for them. When they discover that there is demand in a particular place, they open a
new branch, like the recently opened one in Jammu and Kashmir. Whether or not they have a
centre in an area, their goods reach there. For example, they do not have any centre in Goa, but
they have appointed a distributor for that area to ensure that Lijjat papads reach Goa. Their
communication with distributors is regular through monthly meetings where they discuss their
problems and also the issues that they may have about quality, price, reach, etc. They do not
have individual door-to-door salesmen or women selling from homes -- only the appointed
distributor for the area. The same system is followed for other products, but they may have
different distributors and depots for different products. Exports Their exports alone account for Rs
10 crore (Rs 100 million). They are not directly involved in exporting, but recognized professional
merchant exporters (who also export other food products) place an export order. Only on
receiving the full advance through a cheque do they begin production. Because all exports are
done from Mumbai, the supply also comes from here. Export production is of the same quality as
daily production. In fact, they send some of the daily production for export.
27. Collection flow chart Again with exporters, our responsibility ends with delivery. They are, both,
expected and encouraged to check the goods on collection. After that, where and how they
export is their call. At present, 30 per cent to 35 per cent of the production of Lijjat Papad is being
exported, mainly to countries like the United States, the United Kingdom, the Middle East,
Singapore, Hong Kong and Holland. Distributing profits They have accountants in every branch
and every centre to maintain daily accounts. Profit (or loss, if any) is shared among all the
members of that branch. They have a committee of 21 that decides how the profits are to be
distributed. They generally buy gold coins -- 5gm or 10 gm, depending on the profit. Everyone
gets an equal share of profit, irrespective of who does what work, irrespective of seniority or
responsibility. Even a ben who has recently joined gets the same share as others who have been
with us longer. Each branch calculates its profit and divides it equally among all its members.
Mumbai has 12,000 members, the rest of Maharashtra has 22,000, and Gujarat has between
5,000 and 7,000 members.
28. SECTION 5 Production & Packaging Process The production process begins at 4.30 a.m. in the
morning when the entire sister members come to collect their respective dough. They collect it
and go back to their homes and start rolling rolling the dough. The rolled dough is then dried on a
piece of cloth under sunlight. The next morning the sister members bring these papads back. In
the second stage the rolled papads are send to the quality control department for the regular
quality under the supervision of quality control executive. Lijjat has been maintaining of the same
standard since the day of its existing. The checking of the papads is done in a batch, and if any
of the Papad does not conform to the Lijjat standard then the whole batch is disposed off. The
institution ensures that these defective papads do not reach the market; hence they are disposed
in the sea instead of garbage bin. This guarantees that they never reach the market. In case of
any mistake, the institution not only tries to find out that who has made the mistake, instead they
also try to mistakes is borne by all the sister members, in case of heavy losses, but if the loss is
small or minute then the member who has made the mistake itself bears the loss. The institution
itself carries out the packaging process instead of having collaboration with others. These plastic
bags are manufactured without any technical help or machinery; instead it is hand-made. These
employees are also women. The packaging
29. department comprises of 70 sister members. The bags that are used for packing papads are
Polpopryin (PP) bags. These bags are manufactured at a factory situated at Dahisar.
Diversifications Lijjat has several divisions and manufacturing units: • Flour Division (Vashi) •
Masala Divisions and Quality Control Laboratory (Cotton Green) • Printing Division (Cotton
Green) • Advertising Division, Bandra • Khakhra Division, (Buhari, Valod district) • Chapati
Divisions at Wadala, Borivali, Mulund and Kandivali • Polypropylene set-up (Kashi-Mira Road) •
Vadi factory (Valod) • Bakery Division (Valod) • Detergent Powder and Cake manufacturing unit
(Dahisar) and office (Boriovali)
30. SECTION 6 Market Positioning As a business enterprise, the declining sales figure for three
consecutive years – Rs 298 crore (1999-2000), Rs 288 crore (200-2001) and Rs 281 crore
(2001-2002), is a matter of concern for Lijjat management. Some of its home turf in Maharashtra
 and Gujarat has been captured by a growing completitive local market. But Lijjat has also
expanded to the North – Delhi, Punjab, Himachal Pradesh and, with the latest branch in Jammu,
to the Kashmir market as well. Though each branch is responsible for the marking of its products
in the areas allotted to it, the new centralized marketing offices now procure surplus production
from different branches and market it at an all-India level. This coupled with a healthy upward
trend in the export of Lijjat Papad positions Lijjat as the strongest brand in the Papad industry.
The other big brands in the Papad market are Bikaner, MDH and Saktibhog, but none seem to
be able to make any dent in Lijjat’s share of the industry as their core business is not Papad.
Lijjat marking its products through a wide network of dealers and distributors all across the
country, and has never chosen to sell or push its products directly through the vast network of its
office and sister-members even during the initial years. Rather, over the years, Lijjat has
developed cordial and mutually beneficial relationships with its dealers. Siters claim they believe
in doing the business wisely and on sound business ethics. Dealers are given a set commission
of seven percent and retailer’s earnings are fixed between Rs 2.25 and Rs 26 on the investment
of Rs 14 for 200 grams and Rs 150 for 2.5 Kilogram packs respectively. There are 24 dealers for
Ranchi branch in cities like Ranchi, Jamshedpur, Dhanbad, Bokaro, Patna, Gaya. During the
month of November 20002, around 40,000 packs of 250 gram pack of Papad are sold and the
total income crossed Rs 0.65 million. According to the accountant at Lijjat’s Ranchi branch, who
wishes to remain unnamed (as that would shift the attention from sister-members to employees
and thus violate Lijjat’s
31. principles and traditions), from 2003 Lijjat is aiming at a sales target of a million rupees every
month. Thanks to sound advertising, Lijjat has already become a household name as a symbol of
women’s strength and resurgence, and its recipe combining udad, noong, pepper and hing has
conquered the Papad-eater’s palate.
32. • Products Lijjat’s manufactures several products, of which the Papad is the most famous: •
Papad (five flavors: lasan, moong, mirch, Punjabi and urad) • Khakhra • Appalam • Masala • Vadi
• Gehu Atta(Wheat flour) • Bakery products • Chapati • SASA Detergent Power • SASA
Detergent Cake (Tikia) • SASA Nilam Detergent power • SASA Liquid Detergent THE LIST OF
PRODUCTS AVAILABLE:
33. • Pricing Shri mahila Griha Udyog Lijat papad adopts a Cost Plus Pricing Strategy for all their
products. The Lijjat products are targeted at the middle and lower segments of society. These
segments are highly price sensitive and hence this method of pricing allows them to market their
products extensively. While calculating the price the following expenses are taken into
consideration: ♣ Cost of Raw material ♣ Rolling Charges ♣ Packaging Costs ♣ Selling
Expenses ♣ Administrative expenses A certain makup is then added to these costs to account
for the profits. • Promotions At Shri Mahila Griha Udyog Lijjat Papad, they believe that the best
promotion they could possibly receive is by word of mouth. Therefore they concentrate more on
cost effectiveness and quality rather than on more expensive modes of promotion like
advertisements. Therefore annual expense on advertisement and promotion amounts to Rs. 60
lakes, a mere 0.2% of total turnover. The extremely famous ‘bunny rabbit’ campaign continues to
be aired on specific regional channels. For e.g. Alpha Guajarati, Alpha Bengali, Sun ect. They
also advertise in English and regional newspapers. The distributors also need to be motivated
properly, so that they in turn make a greater effort to sell large volumes of the products to the
retailers. Targets are set quarterly for the distributors i.e. should they exceed this target; the
distributor will receive a further 1% discount.
34. ANALYSIS ¬ SWOT Analysis  Strengths • Sincere Hardwork • Development of woman by
proding them a living / employment. • Maintaining the same standard over the last 45 years. •
Having a unique status in the country.  Weakness The institution does not believe in holding any
weakness for a permanent or a long period of time.  Threats -- In terms of competition -- • In the
Papad industry, the major competition or threat is posed to the institution by Ganesh Papad. • In
the spices industry, the Haldiram and MDH are the major competitors. • In detergent, there are
many competitors like HLL, P&G ect.
35. ¬ Employees / Members There are approximately 42,00 sister members working for Lijjat Papad
not as employees but as co-owners or partners. This is because they have a policy of believing
 that every person working for them is a member and not a employee. It is very well put in their
mind that this institution is just for them. Ninety percent of the member are those women whose
husbands are either disabled or drunkard or do not work. ¬ Organization Chart The Organization
chart as follow: Overall, there is a managing committee of 21 managers that manages the
organization. ¬ Promoters There are no promoters for the institution. This is because their
services are not required.
36. ¬ Markets • Market Segmentation The institution does not do market segmentation because
they do not target age group or income group because their product is for all the masses and
classes. It is a product which is consumed in each and every house as it is affordable to all. The
Papad is available in many denominations from Rs.11/- to Rs.270/- depending on the weight. ¬
Sources of Finance Lijjat borrows funds/takes loans mainly from 3 banks: • Banks of India. •
Bank of Baroda. • Dena Bank. The interest rates for the loans are @ 12% but this is where the
institution gets a concession as 8% out of the out the 12% is paid by KVIC and remaining 4% by
the institution itself. This is perhaps the only concession offered to the institution by the
Government of India. ¬ Technical collaboration The organization does not have technical
collaboration with any other company as no machinery is used in production. Everything is
manmade / handmade. As a main motive behind the building up of this institution is to provide as
much employment as they can for women. Even the packaging is done on their own. ¬ Market
share Lijjat papad occupies 90% of the papad market in India. In spices and detergent industry
the market share is 15-20 percent. ¬ Vanai The institution has a trend of calling wages as vanai.
The vanai paid to the members depends upon the number of kilos rolled by them. The minimum
a member should roll is 5 Kgs. Some even roll upto 20 kgs. Every day. The rate of
37. vanai is Rs. 18/- per kg. So this means that Rs.90 is the minimum paid to each member. Vanai
is paid on daily basis when they deliver the rolled papads and clear the quality tests. The
President and the vice-president are paid a fixed amount of vanai. They are not supposed to roll
papads as according to the norms only the person who has previously rolled papads can become
the vice-president or the president or the president. They are entitled for the vanai only when
they attend the office and perform their respective duties. If on a particular day they remain
absent then the vanai is not paid to them. This norm is applicable for the secretary and treasurer
also. ¬ Prices of Papad Available Dealer Price List General Category 100 gms. 200 gms. 250
gms. 500 gms. 1 kg 2.5 Kgs. 11.00 21.00 26.00 49.00 95.00 232.00 Special category 100 gms.
200 gms. 250 gms. 500 gms. 1 kg. 2.5 Kgs 12.50 24.00 30.00 58.00 113.00 277.00
38. Consumer price List 100 gms. 200 gms. 250 gms. 500 gms. 1 kg. 2.5 Kgs. 13.00 25.00 31.00
59.00 114.00 278.00 Special Category 100 gms. 200 gms. 250 gms. 500 gms. 1 kg. 2.5 Kgs.
15.00 29.00 36.00 69.00 135.00 332.00
39. ¬ Export Prices Export Prices ranges from Rs.21/- To Rs.24/- SECTION 7 Challenges and
potential The story of seven illiterate and poor women who borrowed Rs 80 to start a Papad
business, and took its turnover from Rs 6,196 in the first year to Rs 300 crore in the next four
decades, involving over 40,000 women on its revolutionary march, is fanciful at any a well
thought-out Gandhian business strategy, equally well executed by his followers, late Chhaganlal
Karamshi parekh and Damodar, who worked tirelessly from behind the scene. Their vision was
clear – an exclusive women’s organization run and managed by them, a quality product that
these women had the expertise to make, and, finally, a work environment which is not
competition-driven and mechanized but based on pure labour and love for organization and its
people. Lijjat is today guided by separate divisions of advertising, marketing, sales promotion and
exports. There is greater coordination between branch office (different
40. production and markeing units) and centralized marking, advertising and exports departments.
Transfer of finished products centralized marketing offices from different branches was worth Rs
113.52 crore and ad-spend stood at Rs 2.55 crore for 2000-2001. But more than its much-hyped
sales figure, Lijjat’s experiment in the realm of corporate governance stands out as one of a kind.
All the centers are’ autonomous; profits remain with the respective branches and are normally
used to augment the business after a due share is distributed as extra vanai charge to sister-
members. Employees, numbering about 5,000 including the chairperson herself, are in no way
superior to sister-members, and are therefore expected to behave accordingly. Besides, the
 phenomenal growth and expansion og Lijjat into a muti-product company has opened up new
employment opportunities for the sister-members; eligible candidates are chose and trained to
work in its modern Polypropylene, Sasa detergent & cake and printing divisions. Lijjat’s Ranchi
branch was established in November 1997 bifurcating it from the only branch in Bihar at
Muzaffarpur. It pays Rs 11,000 per month as rent for the building which houses’ its office and
workshop. A “trekker” (thirteen-sister passenger vehicle has also been purchased for the
conveyance of sister-members from home to the Lijjat office and back. This branch has 165
sister-members and sold Papad worth Rs 0.65 million in November 2002. Vanai charge on
Deepawali this year. The Muzaffarpur branch, according to Lijjat sources, paid Rs 2,500 as extra
according to Lijjat sources, paid RS 2,500 as extra vanai charge to its sister-members. Similarly,
the Mumbai and thane branch distributed gold coins of five grams to each of the 4,056 sister-
members a couple of months ago. The branch averages around their rupees as gross profit and
one rupee as net profit from per Kilogram of Papad. “As an experiment, Lijjat has insulated its
sister-members from joblessness. These women also work from their homes, where help from
other family members not only adds up to the income but makes the work more enjoyable. At the
workplace they are self- respecting, hard-working and sisterly to one another. More importantly,
besides the strength of womanhood, Lijjat is also an experiment in the restoration of the essence
of womanhood. The Lijjat women offer an alternative to the highly competitive and stressful
41. work environment defined and dominated by men in which a woman competes with a man
more as a man than a woman,” says elderly Gandhian, TK Sumaiya, Bombay Sarvodaya
Mandal. Contribution to social service On several occasions, the Lijjat member-sisters have
undertaken social service activities such as distributing nutritious food for poor children, donating
money for conducting community marriage, instituting prize- money fore spread of primary
education, undertaking blood donation drive, organizing heath camps, plantation drives and even
making donations to Government bodies. In 1999, the Mumbai City felicitated Smt. Rukminiben
B. pawar, Lijjat President, as an outstanding woman in the field of social work. Lijjat undertook
the rehabilitation Of chincholi (Jogan), the earthquake affected village in the Latur district of
Maharashtra. The institution provided the finance and supervised the work of construction of fifty-
eight houses for the people of the village. Member-sisters donated money from their daily vanai
(wage).
42. After the 2001 Gujarat earthquake, all the branches of Lijjat gave a total donation of more than
Rs 4.8 million, including Rs 1 million from the central office. Lijjat built forty houses for the
rehabilitation of the people of Bhujpur (Bhachau) in Kutch District. SECTION 8 PROBLEMS
FACED BY LIJJAT PAPAD &THEIR SOLUTION o The papads are prepared in different parts of
India, the quality of the water used usually varies, and so can the quality of final product. To
prevent any inconsistencies, Lijjat has its own laboratory in Mumbai, where the final products are
tested and coded. In the monthly meeting, the quality issue and modifications are also discussed.
Currently there is a problem of fake Lijjat papads being introduced in the market. In June
2001,three persons are arrested in this connection in Bihar, but the threat exists in the global
market also.
43. With increasing business and other advances, the need for information dissemination and
communication among member sisters at various branches has increased. The monthly regional
meeting, annual general meeting, and All-India convention of branches are held to keep the
members aware of organization activities and strategies, and to discuss issues such as quality
maintenance, production rates, the handling of accounts, and everyday problems to assure a
better work environment. 1) Previously Detergent, along with all the other products of Lijjat was
exempt from sales tax. Recently the Government has passed a new provision, which does not
include detergent in the PCPI (Processed Cereals and Pulses Industties) list of products.
Therefore, Shri Mahila Griha Udyog Lijjat Papad is Libable to pay the Sales Tax for their Sasa
Detergent Powder. Negotiation is currently being carried out with government to exempt this
product from Sales tax as well. 2) The rolled papads need to be dried for a certain number of
hours. This entire process in done in the ‘bhagini’s’ homes. Therefore in the monsoon when it
rains it is difficult to dry the papads outdoor. This now has to be indoors. The ‘bhaginis’ stay in
small houses and space is a constraint hence fewer papads are produced during the monsoon
season. This is the reason that Lijjat does not export in monsoons. The solution adopted by Lijjat
is to provide extra money to the bhaginis during monsoons to purchase kerosene lamps to
 enable faster drying of papads. Our suggestion is to hire an additional space during monsoon a
central position near the depots, with kerosene lamps where the bhaginis can come and dry their
papads. This will lead to higher production which can be exported. 3) Another problem expressed
by them is competition in sales of their detergents (Sasa) from established brands like Nirma. We
feel one of the reasons for this problem is lack of advertising, as stated earlier, Lijjat spends only
0.2% of their total turnover equal to Rs. 60b Lkhs on promotions. They need to increase their
investment in advertising through electronic media and print media, which will create greater
awareness about their detergents and increase sales. Also, currently they don’t use direct selling
to sell
44. their products. They rely mainly on word of word of mouth which has been successful for their
papads but has not worked so well for their other products like detergents. We feel they should
adopt direct selling as it involves low cost and it will definitely widen their reach and create more
awareness about their products. 4) Lijjat currently exports through merchant exporters and does
not involve itself in direct exporting. We feel they can save on the margin that the merchant
exporters make, by appointing their own distributors in the main countries and this will enable
them to reduce cost and increase profit margin. Factors for Success o The merging of ownership
with membership has encouraged uniform and sustained organizational growth. o The consistent
quality of the product has been a primary factor in establishing and maintaining Lijjat’s brand in
the market for the last four decades. o The Sarvodaya philosophy proved vital in forming Lijjat’s
foundation. o Lijjat has emerged as an innovative organization in which women from religion,
caste, or class can become members. The pledge and all-religion prayer also encourage
cooperative work among women, irrespective of caste or religion.
45. o Transparency in operations and nonhierarchical structure has helped in establishing
organizational accountability among member sisters. o Lijjat encourages its members to give to
others whatever they can, instead of expecting help from others. Lijjat does not accept donations,
but gives donations, which enhances members; self-esteem and pride in their own organization.
o Calling the members “sisters” creates an informal work environment. Frequent meetings, open
interaction, and consensual distribution of tasks reduce the possibility of disputes resulting from
communication gaps and help work to go smoothly. o Lijjat provides economic opportunities
through a domestic activity. Once involved in this activity, the women acquire confidence and
status as they make money in a respectable manner. The more enterprising responsible and
experienced member sisters climb the administrative ladder. Lijjat exemplifies a remarkable way
of making leader out of ordinary women. SECTION 9 Conclusion The most interesting lesson
managers can pick up from Shri Mahila Grihan Udyog Lijjat Papad, sticking to its core values the
past forty years. The institution thus paves the way for women to become self-reliant and self-
confident. In the process Lijjat provides them the platform for improving their status in the society,
which is their justified right.
46. The ladies are brimming with confidence. Lijjat is an institution which has stood the trial of time
and tribulation and has achieved success because when basic management principles and
uncompromising quality consciousness are applied in conjunction with sound business
principles, there can be only one way for the ladies of the Lijjat-a brighter and happier tomorrow,
the pride and joy of fulfillment. Lijjat makes almost equal money for its entire people and makes
just enough money. No one would become a millionaire by setting up another Lijjat. If this aspect
of Lijjat’s operations is not very good news for machine and money-driven corporate owned by
tycoons, the essential message that Lijjat’s success conveys has definitely fired the imagination
of women and rural folks. In many parts of Maharashtra and Gujarat, locally manufactured and
marketed eatables are catching on. There is hardly any NGO or voluntary organization nowadays
which does not try create employment and funds, small or big, along Lijjat’s line. As a business
house, Lijjat itself has been trying to rewrite its own success with another product with varying
degree of success. Grounded spices, Khakhra, black pepeer powder, detergent powder and
cake, Vadi, bakery products, wheat filthier are on Lijjat’s menu but Papad with a sales figure of
Rs 288 crore remains at the top. Among similar ventures which came a cropper are incense
sticks, leather bags, Tiffin boxes and matchsticks. But most promising among them is the
chapatti division with six branches in Mumbai. Here, the women come in to work at around seven
in the morning and make chapatti as they are prepared in homes. Packed Lijjat chapatti, four for
Rs five, are available at retail shops in Mumbai. These centers also procure orders from hotels,
 office canteens, etc. and the catering in Mumbai includes some big names from the hotel and
catering industry. ‘As the pace of life increases, little time is available to most people in metros
like Mumbai to cook their own food. There are good prospects for women forming small groups
and catering to the local demand for homemade chapatti or similar products,” says Ashok
Bhagat, a leading social worker engaged in tribal welfare activities in the Gumla district of
Jharkhand.
47. Next time there is Lijjat Papad on the table, you sure can see a Chandrasekhar or Suja’s
dimpled fingers deftly roll out the crisp Papad. It is made with love and care, just like from their
mama’s kitchen. Bibliography www.lijjat.com Information from the Lijjat prospectus Visited Lijjat’s
office.