Report on Marketing Study
in the area of Handloom Project
under CLSP component of OFFDI
Supported by:
Department of Planning and Co-ordination
Government of Orissa
Project implemented by:
Institute of Rural Development and Management Studies(IRDMS)
Report on Marketing Study in the area of
Handloom Project under CLSP component of OFFDI
Supported by:
Department of Planning and Co-ordination,
Government of Orissa
Project implemented by:
Institute of Rural Development and Management Studies(IRDMS)
Content
Background
The Study Area
Sambalpuri handloom in the operational area
Social-economic profile of the weaver community
The Marketing Study
The Process
The Weaving Operation
Supply of Raw materials
Marketing Channels
Marketing of the woven goods
The marketing Channels
Issues
The Existing Supply Chain
Conclusion
Background
Orissa has the richest traditions of handloom and handicrafts in the country, more
specifically having handlooms like Sambalpuri, Maniabandha, Bomkei, Bandha etc.
Amongst these Sambalapuri have its unique identity and demand in the market because
of its texture, design and durability of colour. Although the Sambalpuri name of a
locality attached to the product, since age long the textile type has its presence in
undivided Phulbani and KBK region since ages. The traditional cultural trend and
costume adopted Sambalpuri handloom as customary item in the society. The
traditional artistic handloom fabrics and other craft items reflect the cultural heritage of
the region. Which became the major livelihood option of the state next to agriculture
and the handloom sector provides major employment to people in the informal
economic sector.
As the weaving sector depends mostly on government patronage as incentives
provided to the handloom industry from time to time. As a result excluding the highly
skilled tie and dye weavers constituting around 40 per cent of the weaving population,
while the rest depends on the local market and local marketing out let's to sustain their
livelihood.
At present it is observed that the handloom industry of Orissa in particular and the
country in general is passing through a very difficult time. The introduction of new
economic policy (NEP) and adoption of SAP (structural adjustment programme)
measures by the Government of India since 1990 have resulted in downfall and
decelerating growth of the handloom sector in the absence of adequate state sector
support and interventions. The primacy of the market economy and globalization
without adequate innovative measures and support for the handloom fabrics have
slowly started affecting the growth of the industry and livelihood of the weavers all over
the country. Orissa, a least industrialized and poor state has become the worst sufferer.
The latest Handloom Census conducted by the NCAER (National Council for Applied
Economic Research) during 1995-96, however, shows that the number of commercial
looms in Orissa was 76,645. In these looms 81,440 persons were working as full-time
weavers and 23,236 were part-time weavers. Added to this, 45,210 persons were
engaged in full-time preparatory works and 58,172 persons were employed on part-
time basis. Thus, during 1995-96, the handloom industry of the state was providing
direct employment to 2.08 lakh persons as against 2.44 lakh persons during 1987-88. This
shows that the handloom sector in Orissa has registered a marked decline in the post
liberalization years.
Although Orissa is a traditionally non-cotton growing state, it has a substantial and
numerically larger size of weaving population depending on handloom industry for
their livelihood because of absence of industrial source of livelihood and the customary
practices in the society.
The Study Area
The present study area is restricted to the block of Baraplli in Bargargh district and the
nearby trading outlets at Bargargh, to understand the basic features of Marketing and
related issues to it.
Sambalpuri handloom in the operational area:
As Sambalpuri handloom is predominate
in the area and the only source of
livelihood for the weavers' community
the study covers almost all the
stakeholders associated to the sector. The
handloom of Orissa, particularly woven
by the weavers of Bargarh District have
been appreciated all over the Country
and abroad because of its appealing form
, workmanship design and color
combination . The tie and dye design
otherwise known as IKAT fabric, popularly known as “Bandha” technique in
handloom weaving. Western Orissa has been the most appealing from of hand of
weaving process with an intricate art of long tradition of excellence and craftsmanship,
mainly woven in the district is a specific design which is only possible in manual labor.
The 17,133 weavers in the district mainly engaged in making of traditional Sambalpuri
design of tie and dye sari and other dress material like dress materials, towel, napkin,
door and window curtain, handkerchief etc. Eminent personalities like Late Sri Krutarth
Acharya and Sri Kunja Bihari Meher of this
district have been awarded with
“Padmashree” for their outstanding
contribution in Sambalpuri Tie & Dye
methods. Out of 52 nos. of working
Weavers Cooperative Societies of Bragarh
district the Sambalpuri Bastralya
Handloom coop. Society Ltd. having its
headquarters at Bargarh, within the
jurisdiction of un divided Sambalpur
district then after it extended to K.B.K district and subsequently extended to coastal belt
of Orissa, was organized by Dr. Padmashree Krutratha Acharya during the year 1954
There are about 6000 nos. of its regular wavers under 'A' class membership, working
through its 49 nos. of Weaving Branches and numbers of Weavers coop. Societies from
Western Orissa and 33 nos. of W.C.S from coastal belt . By this about 15,000 weavers are
being provided with gainful employments below the poverty line category.
Social-economic profile of the weaver community:
The Bargarh district lies between 200
43' to 210 41' North latitude and 820 39'
to 830 58' East longitude. It is one of the
western most districts of the State of
Orissa and came in to existence as a
district from 1st April 1993 as separate
district from Sambalpur. It is bounded
on the north by the state of
Chhatisgarh and on the east
Sambalpur district, on the south lies
Balangri and Subarnapur district and
on the west is bounded with Nuapara district. . Bargarh district has an area of 5837 Sq.
Kms with a population of 13.46 Million as per 2001 census, out of which 6.81 millions are
male and 6.65 millions are female.
Bargarh District has two distinctly
different kinds of scenario in the field
of economic development one is
agriculture and other one is handloom.
The area under the Command area of
Hirkud Dam has a fairly developed
agricultural based livelihood
practices. The rain fed area like
Padampur Sub Division and Bhatli &
Ambabhona Block of Bargarh Sub
Division are backward with traditional agriculture and lack of development of other
sectors as well. During the recent years there is an increased demand for other allied
industries and service like Poultry, Diary becoming increasingly popular. Lacks of scope
in service sector, the unemployed youth are evincing more interest in self- employment
opportunities. Besides, traditional workers like potters, Blacksmiths, Construction
Workers etc., there are fairly good presence of handloom weavers' concentrations in the
district.
The Marketing Study:
As discussed earlier, handloom being the
second largest traditional livelihood sector
in the district and more particularly in the
operational area of the project. The current
study intended to understand different
aspects affecting the sector and more
specifically the market chains mechanism
associated with the sector. The study was
conducted in the program area, with a
objective to understand different key
factors, channels and status in marketing of
the Sambalpuri handloom sub sector.
The Process:
The study process was initiated with a
thorough visit to the secondary
information available on handloom sector
of Orissa followed by interaction with
primary and secondary stakeholders
associated. A questionnaire pertaining to
the subject was also administered to collect
information from primary source.
The Weaving Operation
The sustainability of traditional weaving
operation is greatly dependent on the
prevailing market position, efficiency of
management of the weavers' co-operative
societies and production centers,
availability of basic raw material-yarns,
dyes etc. Though the sector is facing
problems to survive and maintain its
position particularly in the light of the
serious challenge posed by advent of
power looms and the organized mill sector, the weaving community still continues to
struggle to maintain their livelihood by pursuing their traditional occupations. Many
handloom co-operative societies and production centers are passing through the crisis
situation caused due to competitive environment by the organized modern textile
sector.
The present status of weaving operation and working of the looms, availability of raw
material, utilization of weaving assets, modernization of loom and marketing of the
handloom products have been studied during the process. It is important to note that in
spite of growing competitions and pressure caused by the modern textile sector, and
shortage/irregular availability of raw materials, almost all the weaver families met have
still been continuing with their weaving operations to limited scale. Govt. assistance in
terms of credit availability, supply of yarns and dyes, training and supervision, quality
assurance and marketing support has been reflected in dwindling position of traditional
weaving sector.
Supply of Raw materials
The materials used for weaving the
handloom products are of tools /
machineries and raw materials. The majority
of tools and machineries are of one time
input, where as raw materials like yarns and
colors are the variable items being used in a
regular basis.
As Sambalpuri handloom is a traditional
type of art most of looms being used are made out of wood and iron. Local craftsmen
manufacture the loom and other ancillaries. While for raw materials the weavers
depends on out side producers located at Coimbatoor and other south Indian towns.
These raw materials are being procured by local traders through different agents. Most
of the local trading agencies are located at Bargargh and Barapalli followed by other
retailers in places like Smabalpur, Sonepur, Boudh , Manmunada etc. The weavers
collect their raw materials either through these retailers or local weekly market at
Balijhari and from regular retail shops in different location. Balijhari is a local weekly
market where both producers and petty
traders get assembled to sell out their
produces and materials. The other major
channel of raw material is the intermediary
business men provides yarns and colours at
the door step of the weavers with a
understanding to get back the final products
after providing the appropriate wage to the
individual weaver, which varies from
traders to traders and again based on design.
While the last channel is the Weavers
cooperative society. These societies provide
raw materials to the member weavers and in
turn collect the finished products through
the society on piece rate basis with certain
quality standard. Majority of the weavers
prefer to adopt direct purchase of raw
materials and sale their products through
open market. As they don't able to meet the
standards of the cooperatives and often fetch some extra margin. The payment mode of
cooperatives also not suite to the producers as there is the practice of part payment.
Among the beneficiaries procuring yarns,
the extent of dependency on co-operative
societies as a source of supply has greatly
decreased and most of the beneficiaries are
now depending more on the local market
for procuring yarns. Since inception, the
co-operative societies have been playing
an important role in making provision of
yarns and dyes for their weaver members
for maintaining a stable operation. In due
course of time, the structure and
performance of co-operative societies and production centers have significantly
declined leading to dormancy in its business. The weaver co-operative society has failed
to ensure steady supply of yarns and dyes to its members to maintain continuity in
handloom operation. Majority weaver families associated with Cooperatives
expressing their dissatisfaction on the performance of co-operative societies in the mater
of supplying raw materials for their weaving activities. This mainly pertaining to
irregularity in supply, inadequate quantity of supply and poor quality goods delivered.
Often the quantity of supply of raw materials by the societies was much less than their
requirement.
The cases of beneficiaries experiencing
shortage of yarns and dyes needed for their
weaving operation have been studied with
regard to magnitude, frequency and
reasons of shortage. About 65% of the
surveyed weaver family reported facing
shortage of yarns and dyes required for
processing of their handloom product, at
present. However, rest of the families
reported that they did not face any shortage
of yarns and dyes. The percentage of weaver families reporting shortage of yarns and
dyes relatively belongs more to the c o-operative sector as compared to those not
supported by co-operative sector.
Marketing Channels:
As shown in the diagram here, unlike other
products in the market yarn and colour have the
same route of supply of raw materials. The
manufactures of yarns have there wholesale
agents in different locations and here in Bargarh
operate through agents and retailers. These
wholesalers have the capacity to procure and store
huge amount of stock to have a control over the
market. Two/three such wholesale outlets are
present in Baragarh and Barpalli those are
controlling the entire yarn business of the area.
The retail outlets present in Bargarh, Barpalli and
other places in the state are the intermediary
market players who operate directly through
retailing and agents. Producers (Weavers) meet
their raw materials requirement either from
these outlets, local markets or from agent. This
mostly happens with non member weavers. The
weavers who are members of Cooperatives are
getting it directly through cooperatives and sales
there finished goods through those institutions
and in turn get there income either in shape of
wage or piece rate approaches.
During the process, as opined by many 80% of the respondent, the weavers don't have
any access or control over the yarn market, the income from the sector is in a declining
trend. Because, procuring yarn depends on the volume and time keeping the stock.
During the survey it was found that no weaver a have any idea about the source of raw
material beyond wholesaler point.
Dye and dying materials are another product upon which the producers (Weavers) have
any control. During the process it was also noted that majority of weavers have shown
their unhappiness over the quality of the dye and its price fluctuation in the market. This
basically occurred due to ignorance of market channels and control over the market.
Factory producing
yarn and other
raw materials
Agents
Wholesale out
lets in Bargarrh
Local Retail Weekly Market Cooperatives
outlets out lets
Agents of
marketin
g houses
Producers
Production:
The production of different types of woven
goods, their size, price, sales etc. has been
analyzed as presented. The volume of sales and
value of the woven goods sold through to the co-
operative societies/production centers and in the
open market have also been discussed.
The volume of production of different category
of woven products in terms of number of pieces
produced of an average month have been
calculated It is found that average number of pieces of Sarees produced in a month per weaver
household is nearly 8. While production of Lungi, Gamchha and handkerchief varies from a range
of 20 to 40 piece in production month. The cost of woven products produced per month per
household has also been discussed. The average value of production of Saree per household per
month shows is in a range of Rs. 3200/ - to Rs.6000/- depending on the factors like design, skill
and labour diversification by the weaving household. It is also important to discuss here that the
product diversification and use of advance tools and machineries plays a major role in production.
The age old practices of hand weaving often restrict the income through production.
Marketing of the woven goods:
The competitive pressure exerted by modern
textile products has not created any perceptible
change in the acceptance and choice of
customer segment for handloom products.
However, there has been significant change in
the flow of handloom goods through different
marketing channels. Due to functional
restrictions of the weaver co-operative societies
and production centers, majority of the weaver
community has switched over to direct
marketing through intermediary market agents
in the open market or direct selling at local
market outlets. There has been drastic decline in
sale of handloom woven products through co-
operative societies and production centers. The
average monthly sales per household of
handloom products in terms of pieces through
co-operative societies have declined 3 as it was
15 earlier. The different channels of marketing
can be better understood form the diagram
presented.
Majority of respondents reported that growing consumer preference and test, in recent times,
towards variety of modern fabrics has severely affected the demand for handloom items. Textile
products being manufactured by organized spinning mills offer variety of designs of fabrics and
attract more number of consumers, squeezing the market size for traditional handloom products.
It also important to note that majority of the respondents felt that the handloom items being
costlier than the modern textile items find it
difficult to attract more consumer segment. The
major cause is non production of low cost daily
use saris in comparison with modern textile
sarees available in the market. This restricts the
handloom products with in segment of
population and occasions. At present which
forced the weaver community to explore ways
and means to control the operational
expenditure and to improve productivity in
handloom industry. Provision of sustained
supply of raw materials (e.g. good quality yarns and dyes etc.) can greatly aid in smoothening the
operational crisis in handloom sector. Since advertisement plays an important role in the
promotion of textile products, traditional handloom sectors find it difficult to mobilize and
allocate required funds and investment on advertisement through mass media channels
THE MARKETING CHANNELS:
Producer
Local
Cooperatives Retailer weekly Business
Market house
agents
Bastralaya Show room
Consumer
Issues:
w As majority of the weavers household found to be poor and lack of access to mainstream
financial institutions are not capable of keeping more raw materials and in turn fails in
fetching more income
w Raw materials being a monopolized item by few traders often affect the income of the
weavers.
w The traditional weaving equipments reduce the output and in turn affect income.
w On organized raw material market
w Though good quality of finished product fetches good return, which have standardized by
the cooperatives, but absence of standardization of raw materials affects
w Artificial shortage of raw materials affects production and reduces the income
w Non availability of yarn and dying material at weavers point affect productivity
w Individual centric approach in production and marketing of non member weavers
THE EXISTING SUPPLY CHAIN:
BOYANIKA
WEAVER MARKET
CO-OPERATIVE
SOCIETY
MARKET
BUSINESS MASTER WEAVER
HOUSES WEAVER SHG
RAW
METERIAL RAW
METERIAL
RECOMMENDED
MARKET
RAW
METERIAL
Conclusion
Considering the various relevant factors, issues and problems associated with handloom (More
specifically Smabalpuri) and its consequential impact on the socio -economic condition
members engaged following suggestions and recommendations can be persuade.
As most of the weavers operating on their own an apart from the handloom co-operative societies
and production centers, it is recommended that raw material centers (May be Yarn and Dye
banks) may be initiated at village level with a direct networking with spinning mill, wholesale
merchants for raw materials. In the similar process SHG based sales outlets in a cluster can be
developed to sale out the products with a standardize practice. Which could able to provide timely
supply of raw materials and marketing of products in bulk.
Apart from marketing up gradation of traditional looms and equipments needs to be taken care of
along with skill up gradation of weavers and master weavers.
