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1. Lijjat papad - Document Transcript
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

2. 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

3. 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.

4. 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

5. 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

6. 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.

7. 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-

8. 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

9. 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.

10. 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

11. 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

12. 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

13. 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

14. 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

15. 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

16. 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.