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MADAME ROSA DISTILLERY

Pedro Vicente Vaz Corner Bldg,

Nr Bank of Baroda, Mapusa, Goa - 403507

By

Stezia Rodrigues and Megan Viegas

Don Bosco College, Panaji


Madame Rosa Distillery – Bound to challenges.

Feni an exclusive aromatic drink with low-calorie content and other medicinal
properties like being a good appetizer, an antidote for cough and cold

This case presents the challenges faced by Madame Rosa Distillery, a bottling
company of feni and even other distillery like Cajulana, Real, Lobo and Renco. The
feni industry had moved leaps and bounds from a local drink to of international
importance. The case describe the market potential of feni and the rising challenges
that are been faced.

Issues:-

 The decreasing agricultural productivity over years

 The impact of mining on agriculture

 The need of standardisation of the production process

 Consumer preference towards the drink is unpleasant to a certain extent

 Rising competition threats

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Content

History 4

Geographical Indication 5

A step forward for GI 5

Agricultural Productivity 6

Mining 6

Production of feni- the traditional way 7

Excise duty 8

Consumer preferences 9

References 10

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History

Madame Rosa Distillery started by Mr. Valentino Vaz, a household named in Goa
which is easily and readily identified with the production and marketing of exclusively
blended cashew and palm feni, wines and liquors. Feni is an exclusive goan drink
distilled from cashew apples. Some of the leading feni brands, like Big Boss, PVV
(named after his father, Pedro Vincent Vaz) and Godfather, are stocked by all the
tavernas and bars in five-star hotels in Goa. Mr. Valentino Vaz made a modest entry
in the spirits business in 1960, when he was 27, by becoming a major importer of
Black & White Scotch from Singapore. Until then, he was working with his father in
the family’s business of baking and trading. “Getting an import licence during
Portuguese rule was a matter of one day,” But after liberation in 1961, the government
of India first banned imports altogether and then imposed the quota system on
importers. Each importer was allowed only a limited licence “Even after liberation, he
continued to be a major importer of Scotch in Goa, “Only the small importers were
hit.

“He was importing Scotch right until 1983, when he took up bottling and packaging
feni for Dr. Ivo Azaredo Costa of Vinicola Wines and Costa food products. “People
distilling feni used to rely on second-hand bottles for their spirit. So he started
manufacturing new bottles. He bottled and packaged Dr. Costa’s ‘Patrao’ feni. Feni
was sold for Rs. 11 a bottle in those days. But they successfully sold ‘Patrao’ for Rs.
18. This convinced him that people would spend on good quality and packaging,” Mr.
Vaz was with Dr. Costa for one year, and during this time he also became an agent of

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Herbertsons for their liquors and rums. Then in 1985, he started making Big Boss.”
The success story started from then and continues today.

Madame Rosa has also been diversifying into coffee and other liqueur. Flavors
include mango, anise, almond and chocolate mint. PVV (Pedro Vincent Vaz), another
prominent brand, comes out with its cashew and palm products (in sizes of 750 ml,
180 ml and 60 ml).

Geographical Indication

The goan feni received its GI (geographical Indication) tag on 23rd March 2009 after a
long journey started by Mr. Valentino Vaz in 1997. The need for protection aroused
when he read about American Corporation filing patent for basmati rice. The Goa
Cashew Feni Distillers & Bottlers Association and The Department of Science,
Technology & Environment of the Goa government had jointly sought the GI tag for
feni. Through Maharashtra government is looking into the possibility of allowing of
cashew feni in the state they can’t surely call it feni, but in the scenario of free trade
enterprise nobody can stop anybody from producing spirit or alcoholic beverages from
cashew fruit. This shows the market potential of feni which has stood silent.

Geographical indication is an indication which identifies a product as originating from


a particular geographical area, where a given quality, reputation or other characteristic
of the product is attributable to its geographical origin.

A step forward for GI status

Attempts are undertaken to file applications in some other countries, including


European Union for the GI status. According to one estimate, about 40,000 people are
involved in feni industry Goa directly or indirectly, which includes distillers, bottlers
and farmers. “It definitely elevates the status of brand Feni, both from the point of
view of the industry and the government. It is also a step forward from the point of

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view of the customer, who can now buy cashew feni with the confidence that it will be
made only of the cashew fruit juice in the traditional pot still method” said by Mac
Vaz and Cedric Vaz the son of Mr. Valentino Vaz.

But now the question is whether the benefits of GI are able to be translated into a
better price and a better deal for the bhatikar, who is the first and most important link
in the supply chain. The bhatikars are the cashew growers, some of whom distill their
own brew and others who sell their produce to larger distillers and bottlers according
to a newspapers article.

Agricultural productivity

The focus should be on improving quality and consolidating their existing markets. In
any case the production of feni is limited by the annual yield of the cashew fruit,
which is notoriously weather-dependent and unpredictable. Also, though the area
under cashew cultivation has grown over the years, the overall output has not
increased proportionately due to falling productivity, meaning that unless cashew
yield improves dramatically over the next few years, the annual feni output will still
be just about enough to cater to the local market.

The annual production of cashew plantation is falling down possibly because it takes
almost 3 years for the crop to bear fruits. The government schemes are good but it
may lack the opinions of the farmer. For example the assistance for 15,000 per hectare
is provided for maximum 4ha and the subsidy is provided in the ratio 60:20:20.

Mining a threat

“Some of the best plantations in north and south Goa are being destroyed by mining
activities; Mining operators are encroaching upon land used for cashew plantations.
The companies dump ore rejects on our plantations” said the Goa Cashew
Manufacturers Association President, Mr Madhav Sahakari; Mining operators are

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encroaching upon land used for cashew plantations. The companies dump ore rejects
on our plantations.

The Feni industry is still largely unorganized though, and many distillers are simply
unaware of the developments on the GI front, leave alone what it can mean for them.

Production of Feni – the traditional way

In the traditional method of making cashew fenny, the cashew apples are manually
crushed in a rock on the hill which is carved or shaped like a basin with an outlet for
the juice, called a coimbi. The juice is collected in a huge earthen pot called a Kodem,
which is buried in the ground. The juice is then distilled in earthen or copper pots.

When the cashew apples are crushed, the pulp is arranged in the shape of a cake in the
coimbi and tied with a string. A huge boulder is then placed on top of it. The final
quota of juice which trickles out in a clean form is called Neero. Many people like to
drink Neero since it helps bowel movement and provides relief from constipation The
traditional method of distilling cashew fenny takes place on the hill. The cashew juice
is put in a big pot called a Bhann. The Bhann serves as a closed boiler. It is connected
to a smaller pot called Launni by means of a conduit. The Launni serves as a receiver
or collector.

The juice in the big pot is then boiled by burning firewood under it. As the process of
vaporisation and distillation goes on and the concentrated liquid collects in the smaller
pot, the pressure in the receiver is kept in check by pouring cold water on it, typically
with a wooden ladle. The first stage of processing may be done on big fire but the later
stage of distillation has to be done on slow fire to keep the pressure and heat under
control. The process of distilling fenny with such apparatus takes about 8 hours and is
locally called Bhatti.

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It is possible tell from a distance that fenny is being distilled since the surrounding
area is filled with its aroma. This production process lacks the standardisation process
and the need of hygiene to a certain extent.

Excise Duty

Through the Goa Excise Duty Act, 1964 the Excise Department grants various
licences for different stages of Feni-distilling. These provisions are mainly found in
Chapter VIII of the Act, titled ‘Manufacture of Liquor from Cashew Juice’. The area
of cashew cultivation is delimited into cashew zones according to cashew orchard
ownership patterns. Through the months of February and March these zones are put
up for auction. These annual auctions are for licences to extract cashew juice. The bid
with the highest estimate of cashew juice extraction is granted the licence for that
year. The duty to be paid is a function of the amount of juice that will be extracted. If
the bids are insufficient or not forthcoming, the Excise Department disposes by tender.
At times, cashew zones remain even after attempts to tender them. The Audit Report
for 2002 noted that between 1999 and 2002, over 250 cashew zones were not taken up
and resulted in a loss of excise revenue of Rs. 12.7 lakh. Separately, a licence to
manufacture liquor from cashew juice is required. Typically, the person who has
secured the auction also applies for the licence. This is also an annual procedure and
the applicant has to inform the Excise Department of the number of stills to be
operated and their location.

In the eyes of the Excise Department, all liquor produced in India falls under one of
two categories – Indian-Made Foreign Liquors like rum & vodka, and Country
Liquors like mahua, arrack & mosambi found in other parts of India. Feni being
classified as the latter prevents the drink from being marketed outside Goa and lumps

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it along with other local drinks which are perceived to be on the crude side and suffer
from a very down-market brand image. Goa’s feni crusaders promise to leave no stone
unturned until this tag is changed to a more appropriate ‘Heritage Liquor’ tag. This
may take as long or even longer than the GI registration, but Vaz and his colleagues
are geared up for a long campaign. “This is the only way to ensure the long-term
success of the feni industry. Our goal is to ensure that the cottage distillers and
farmers get a better price for their produce and encourage them to bottle their own
brands, while at the same time being cautious not to kill the goose that lays the golden
eggs” avers Vaz. To a certain extent unbranded sales dominate the feni market in Goa
and it is not considered as a competitor.

Consumer Preference

According to Shawn D’Souza a know bartender of Goa said “In regards to feni as a
cocktail base, People are loving it as feni is a very highly aromatic flavored drink and
difficult to consume by itself so when its mixed with another ingredient specially
citrus fruits like pineapple or lime its cuts down the harshness and you have a very
lovely drink which is palatable. But most people who never tried feni before tend to
taste it by itself which is very difficult to drink and then they think it’s a smelly drink,
they don’t realize it’s the aroma of the drink which makes it unique. ”

Madame Rosa export feni to UK, Canada and the gulf region. They receive many
small consignments but fall short to meet the rising demand. There is a large market
share on the other side that is left untapped.

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References

http://www.goavacationguide.com/feni.html

http://www.liveindia.com/goa/feni.html

http://economictimes.indiatimes.com/news/news-by-industry/cons
products/liquor/Goas-Feni-gets-a-makeover-marketed-
abroad/articleshow/6568773.cms

http://news.bbc.co.uk/2/hi/business/8680904.stm

http://www.goancashewfeni.com/

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