Business Development Plan

Name of the Group/IndividualName of the watershed _________________Village / Hamlet:__________________ Name of members/Individual: Name of Members Wealth Category

Livelihood Activity Description:

Detailed Costs: Inputs Fixed Costs Quantity Unit Price (Rs) Total Price (Rs)

Working Costs

Production and Revenue Estimates Weekly Production Quantity of items produced @ Rs. Sales revenue (Rs) Total Cost (Rs) Profit / Loss (Rs) Estimated Project Costs Fixed Costs From the Project From Group From Banks and other sources Total Repayment Schedule No of installment Repayment period Installment amount Working Capital for raw materials and others Total Monthly Annually

Signature of beneficiary Marketing

WMT (Micro-enterprise)

PIA

A cooperative society decided to make blankets as an income generating activity. The facilitators organized for the skill training. Necessary raw material was procured. The production began on a sound note. The blankets were also accepted for quality and type. Enthused by this the women increased the production. On an average blankets worth one lakh rupees

were produced per year. They could sell blankets worth Rs.20,000 in the first year with great difficulty. And in the second year too the sale revenue is not more than Rs. 30,000. As a result the stocks of blankets piled up by the end of the second year. Value of the unsold blankets was estimated to be Rs. 1.5 lakh. The production wheel came to a standstill leading to closer of the income generating activity of the cooperative. Why has this activity not succeeded? In this case there was no inadequacy of skill/expertise and funds too were adequate! Raw material and finished products were always available whenever required. And despite having everything in place if the activity did not succeed it is only because of sales. Many times we do not focus on a fundamental aspect - Marketing. The major reason for marketing to become an issue is that everybody thinks of marketing only after completing the training and starting the production. Marketing of the products made by the rural women is the most critical aspect in income generating activity. Thats why we will try to understand what is marketing and what kind of importance we should give to marketing. What is Market? It is commonly perceived that market is a place where buying and selling happens. In economic parlance it refers to existing potential demand. When we say there is a market for school uniforms in Delhi, what we mean is that the number of people to buy school uniforms in Delhi is high. What is Demand? In laymans perception demand is desire for a product or service. In economic parlance demand is desire backed by willingness and ability to pay.

Customers

demand

those

products,

whose

satisfactions

overweigh

dissatisfactions of monetary loss that they pay as price. What is marketing? All efforts in the process of understanding the consumers needs and demands, giving a shape to them in the product and providing services to the consumer or attempting to provide such services is called marketing. That means, marketing is a complete process right from planning of the activity to meeting the satisfaction of the consumer/user. Marketing is a key to success in business. Many businesses start and only a few survive. Often, the difference between failure and success is effective marketing. Marketing is not mere finding a place or customer to sell a product but involves everything that happens between production and meeting consumer/customer satisfaction. Marketing means satisfying customer needs. It means being flexible and being able to adapt to changing conditions. Marketing is a process involving 1. Understanding the needs, tastes and preferences of the customer 2. Estimating the current demand, visualizing the future demand, increasing the spread and attempting to create new demand 3. Ensuring that your product is better than your competitors in value, type and shape. 4. Making your product attractive or different than similar products 5. Getting the attention of potential buyers 6. Letting them know about your product 7. Making the product available at the right place 8. Setting the right price so that people will buy 9. Setting the right price so that you can make profit

Important things in effective marketing 1. Satisfying customer needs 2. Developing a large number of satisfied customers who will return to buy and tell others about your product, service etc. 3. Knowing who your potential customers are and why they would buy your product and why some people would not buy your product 4. Focusing on a special group of customers and providing special services or products to appeal to them 5. Having a marketing plan that is flexible, reviewed regularly and changed as conditions change When should one think of Marketing? In most cases, a project begins with a product idea rather than a market. The mistake that is usually made with income generating projects is that they are developed without any serious thought whether the product will be sold. There may be a vague idea that these things will sell but in many projects the finished product has no market at all or none that can be realistically reached. It is necessary to think of marketing right from the planning of the activity. The market being sought should be one, which is easy to reach, has room for the product and in which there is a good chance of competing with both quality and price. In the initial stages the responsibility of marketing should be kept with us (facilitators). But we should involve women also in marketing, and we should provide training in such a way that they could handle marketing by themselves. Characteristics of rural market

There are several disadvantages in rural markets. Some of the disadvantages are: Minimum or no infrastructure like roads, transport, communication, etc Has high fluctuations Is mostly seasonal Lower disposal income of rural consumers Mostly need based consumers Lot of spurious and regional players Compromise on quality Movement of mostly low volume packs (sachets, etc.) Is spread out

However, rural markets have some advantages also. Understanding about these characteristics would help immensely as you are stepping into it. These characteristics are: High growth rate Uncapped potential Aspirations of rural masses for branded products

Rural Market Structure Rural entrepreneurs and villagers use different market structures such as village markets, haats and occasionally town markets to sell their produce or to buy their daily needs.

Opportunities for rural products

Higher Markets

Nearby villages/haat

Within village

Village market consists of shops, vendors and traders (middlemen). Village shops exist in almost every village; bigger villages having a greater variety of shops while smaller villages have one or two grocery and pan bidi shops. Vendors hail from local villages and nearby towns and visit most villages for selling their wares. Traders visit villages to buy produce in bulk.

Few entrepreneurs use town markets. They sell to traders and wholesalers who in turn distribute products to retailers through whom it reaches the customer. Villagers also use town markets to buy durables that are not available locally.

Haats

are

the

most

used

and

important

channels

for

entrepreneurs/villagers. Individual buyers, middlemen and wholesalers frequent haats to buy a variety of items. Since the haat has a large number of stalls selling a variety of goods and is the source of purchase

for a large number of visitors, it represents in a way, the demand pattern of the local economy. Importance of micro markets for micro enterprise development Micro markets are important for micro enterprise development as they: Offer scope for products and services to be sold locally, making an enterprise self reliant and locally sustainable. Allow scope for producers to directly understand consumer tastes and choices. Prevent dependence on an external marketing agency for establishing a marketing network and for tapping far-away city markets. Experience shows that these market sources dry up quickly with the withdrawal of such an agency. In identifying products that women could trade in or produce themselves, women can be guided keeping in mind the following questions: Could they make the product themselves? If so, were raw materials and other inputs for production locally available? Would it be possible for them to sell the product themselves or through other family members at haats? After noting the sale prices, could they sell their product at competitive prices? Could they match product quality and maintain it?

After a visit to the local shandi, the women could identify several opportunities ranging from masala grinding, stitching petticoats, repairing old clothes etc. to a host of other trading activities. This market-oriented approach to identifying activities can lead to using haats for selling their products.

Developing a Marketing Strategy For preparing a marketing strategy in any income generating activity we should collect information of the markets relevant to the product/service contemplated. The first information that should be collected is about the customers and their characteristic tastes, their needs and their priorities. The second information is regarding similar products/services in the market. The specialty of the product and the benefits the customers could get from the product, capacity to supply to the market demand, users opinion about the product, etc should be also gathered. The third kind information is regarding the characteristics of our products/services, the benefits they would give to the customers and how they would accept our products, etc. Market survey A market survey is done to: 1. To estimate sales of product 2. To gain knowledge about the market 3. Competitors a. Who are they and their identity b. Product features (quality, price, variety, design, packing, colour, etc.) c. Product promotion and advertising (Brand name, free gifts, discounts, appearance, display, hand bills, hoardings, banners, etc.) 4. Understanding the customer (their choices, likes and dislikes, etc.) 5. Understanding market demand Sources of information 1. Consumers 2. Groups/bulk buyers in the market

3. Other institutions 4. TV, radio, news papers and other publications 5. Competitors 6. Others related with market Important aspects of marketing 1. Market identification Any product has its own place and time in marketing. The market has the market when schools reopen. Similarly video games can be marketed in cities but we cannot succeed in villages despite our best efforts. Hence for the product that we decided to make it is essential to identify where and when to market 2. Market potential This is regarding the capacity to produce for the future markets. This can be done in two ways: One if a new consumer is found and the second if we can convince the present consumer about the future need and how this product would fulfill that need. Hence we need to observe if our product has the strengths or not. The success of our product depends on whether it could sell in the future or not. 3. Supply possibility We should be able to supply intended product in quantities as per the requirements of the intended markets. Hence we should try to know the size of the market and supply accordingly. Sometimes despite having got the orders inability to supply the right quantity at the right time would not attract the buyers the second time. That is why it is important to estimate our supply capacity and the market need.

4. Competition It is also essential to know who the competition is, if it is an individual or an institution/company, the advantages and disadvantages of their product, etc. Too many competitors in the market suggest that there is little demand for the product. Hence there should be proper coordination between consumers needs, how the product is going to benefit them, its attraction and the efforts made to supply them. Marketing mix 4Ps to develop a marketing plan Product Type Quality Variant Properties Size Price Sale price Terms of payment o Cash/credit o Payment period o Payment mode Place Transport Storage Type of outlet Location Distribution network Space Promotion Branding Packing Publicity Offers Lucky draws