Aarong, the largest lifestyle retail brand in Bangladesh, it's organizational story in brief.

1. The Aarong Story
01.08.2013

2. Agenda
• Concept of Social
Enterprise
• How it all began
• Challenge
• Searching for a solution
• Ayesha Abed
Foundation
• Growth
• Artisans and Aarong
• Aarong Today
• Roadmap

3. What is a social enterprise?
• A social enterprise is an organization that applies commercial
strategies to maximize improvements in human and environmental
well-being, rather than maximizing profits for external
shareholders. Social enterprises can be structured as a for-profit or
non-profit, and may take the form of a cooperative, mutual
organization, a social business, or charity organization. - Ridley-Duff,
R. J. and Bull, M. (2011)
• A social enterprise is a business that trades for a social and/or
environmental purpose. It will have a clear sense of its ‘social
mission’: which means it will know what difference it is trying to
make, who it aims to help, and how it plans to do it. It will bring in
most or all of its income through selling goods or services. And it
will also have clear rules about what it does with its profits,
reinvesting these to further the ‘social mission’. – Social Enterprise
UK, UK’s National body for social enterprise

4. COMMERCIAL BUSINESS
SOCIAL ENTERPRISES
EXPLOITATIVE
BUSINESS
IDEALISTIC
ENTERPRISE
WHERE IS THE RIGHT BALANCE?
SUSTAINABLE
Challenge: How to Find the Right
Balance?
Figure: Business Motive Spectrum and Sustainability
BRAC has pioneered a “business model” which defines
Corporate Social Responsibility

5. 1. Support development interventions to
develop self-employment opportunities of
the poor, increase productivity and efficiency
of their enterprises activities.
2. Livelihood creation for the poor
3. Source of funds for BRAC
Core Purpose of BRAC Social Enterprise

6. How It All Began
Fathers, husbands, sons were lost
Drought and natural calamities
 Need for social rehabilitation
 Women without means to earn living
Loss of arts and crafts market
 Indigenous crafts in Bangladesh :
Nakshi Kantha, Jamdani, handloom
(Muslin, Endi, silk, cotton), leather-
crafts, date leaf, palm
leaf, cane, bamboo, clay, terracotta, doll
making, jute, coconut shell and batik, silver
and gold jewellery
 Lack of distribution networks
Bangladesh Liberation - 1971
 Resettles and rehabilitates
refugees
 Organizes and revives cottage
industries to enable livelihood
opportunities for women
 Creation of wide scale retail
channels through social
enterprises
Crafts ingrained into Bangladeshi households

7. A True Social Enterprise
• Transferring a greater
portion of the work to
remote rural areas
• Popularizing boutique-
like handicrafts
• Introduction of AZO dye
and PCP-free dye in
cotton fabric production
• Effluent Treatment Plant
(ETP)
• Recyclable packaging
Holistic
approach in
tackling poverty
Alleviate Poverty
& Empower
rural artisans
especially
Women
Revival of Crafts
& Traditions
Creating &
enhancing value
across the value
chains

8. Searching for a Solution
 1976 - BRAC trains women in sericulture; But waiting for payment
for 2 to 3 months was financially back breaking.
 1978 - To provide a market linkages for rural artisans purveying
crafts established Aarong (means “Village fair” in Bangla).
 Establishes textile design and service workshop to experiment with
materials, weaving, dyeing and sewing technologies.

9. Ayesha Abed Foundation(AAF)
 Established in 1982 to commemorate the work of late Mrs. Ayesha Abed
 Provides livelihood opportunities for women in remote rural areas including
financial and technical assistance
 Trains workers to sustain indigenous crafts.
637 Sub Centers
13 Production Centers
Ayesha Abed Foundation
(AAF)
Head
Office
PC
SC SC
PC
SC SC SC

10. Ayesha Abed
Foundation(AAF)
 Supplies Aarong with large
scale services such as
tailoring, embroidery, block
and screen
printing, Batik, packaging
etc.
 More than 60% of goods is
supplied to Aarong by AAF.
 13 Main Centres
 647 Sub-centres

11. Growth: Creating Structure and Sourcing
Sources products from
Value addition by design
development, quality
control and retailing
Aarong
Ayesha Abed
Foundation
Independent
Producers
Aarong
Production
Centre
• Aarong: 1,769; 60% women
• Ayesha Abed Foundation: 34,178; 100% women
• Independent Producers: 28,270; 65.3% women

12. Pioneering Development of Crafts
Story of Stitches –
An Exhibition on Art of Nakshi
Kantha (2008)

13. Pioneering Development of Crafts
Story of Pride- An
exhibition of
Jamdani Sarees

14. Artisans and Aarong
Aarong
IT &
Software
Quality
Assurance
Access to
Finance
Training
Export
Retail &
Infrastructure
Design &
Product
Development
Marketing
Producer
Relation
Production
Efficiency
Offers one-stop shopping location
from clothing to household
items, gifts and fashion accessories
to children’s toys.
The profit generated from Aarong
ploughed back for BRAC’s
development initiatives both
economic and social such as free
health programs, micro credit, legal
services, education etc.

15. Aarong Centre
 Aarong Centre, the
administrative support
and bridging between
retail and artisans
 Product
research, design, and
development
 Quality Assurance to
Marketing
 Training to Access to
Finance

16. Aarong Today
• Nation’s leading
lifestyle brand
• Over 100 product
categories
• Flagship outlet in
Uttara
• Supports about 65,000
artisans in various
sectors, over 80%
women
• Profit ploughed back
to BRAC’s
development
initiatives i.e.
education, health, mic
rocredit, legal service
etc.
22.14
29.56
14
7.24
7.34
7.11
7.11
1.18
2.68
5
% Sales
Men's
Women's
Children
Home Decor
(textile)
Home Décor (non-
textile)
Jewellery
Leather
Beauty

17. Retail Space
Total area
(in thousand sq ft)

18. Aarong Today: Stats
• Average profit margin 14.93%
• Average basket Tk. 1,473
• Conversion rate 43%
2400
2700
3395
4150
4530
2008 2009 2010 2011 2012
REVENUE
Sales (in TK. Million)
5.5
6.8 6.7
2010 2011 2012
Footfall in million

19. Aarong’s Customer Profile

20. My Aarong Rewards Programme:
20, 432 customers

21. Customer Approval in 2012
• Served 21 thousand customer per day;
• Average operation in all Aarong outlets, 332 days;
• Sold 13.2 million taka worth of handicrafts each
day ;
• 2.58 products per invoice;
• Approximately 5% of revenue from foreigners;
• 3rd largest Facebook fan base in BD;

22. Exporting Handicrafts
• Aarong exports mainly to Europe and Japan
• Member of World Fair Trade Organization
(WFTO), Tradecraft, Banglacraft and Bangladesh
Craft Council
• Export revenue Tk. 66 million in 2012

23. Recognition and
Awards

24. Aarong as Fashion Trendsetter

25. Way Forward
• Two new outlets in 2013: Narayanganj and
Jamuna Future Park
• Launch new software and customer web-
interface for My Aarong Rewards programme
• Gulshan outlet will be shifting with a new look
• Launch e-commerce in Bangladesh and later
phase, expand service to international market
• Ground work being done for Aarong Global
• Handicrafts from Afghanistan

26. Thank you
On 40th anniversary of BRAC, Sir
Fazle Hasan Abed labeled
gender inequality as the
“greatest injustice in human
kind”. He added, “Gender
equality remains the greatest
unfinished agenda not only of
my life’s work but of our
time.”