Incense Sticks manufacturing
ITC works with Small Scale Industries by empowering them to engage rural women for hand-rolling Incense sticks. This helps the rural women have a supplementary source of income all through the year. ITC has brought about a dramatic change in the working of the Incense industry when compared to the way it used to work earlier by removing the middleman.ITC imparts training to rural women in Incense stick rolling, sorting, perfuming and packaging. ITC has introduced a Quality Inspection Manual (QIM), which lays down the scope for checking the materials & final product at each of the stages. This ensures that the final product is the best available that a consumer can buy.Towards ensuring healthy working conditions, masks are given to women working in the Incense manufacturing units. The sorting area is well ventilated with exhaust fans.Thus by this actions ITC is preserving the ancient art of hand rolled incense sticks,imparting the rigors of science into a field that for centuries has been an art Training in terms of fire fighting is also provided. ITC undertakes the trade marketing and distribution of these Incense Sticks under the brand name ?Mangaldeep?. A strong media campaign has been launched by ITC to build its brand of Incense ?Mangaldeep?, and in a short period of time Mangaldeep has become a National brand with a turnover of USD 4.5 million for the year 2004-05. Currently indirectly providing employment to 3000 women across five states.
About You
Location
Project Street Address
Project City
Project Province/State
Project Postal/Zip Code
Project Country
Your idea
Sector of activity
Consumer Products
Other sector of activity
On the mosaic diagram, which of these factors is the primary focus of your work?
Factor
High volume business based on small (even tiny) individual transactions
Principle
Leverage the power of communities as both consumers and producers
Name Your Project
Incense Sticks manufacturing
Describe Your Idea
ITC works with Small Scale Industries by empowering them to engage rural women for hand-rolling Incense sticks. This helps the rural women have a supplementary source of income all through the year. ITC has brought about a dramatic change in the working of the Incense industry when compared to the way it used to work earlier by removing the middleman.ITC imparts training to rural women in Incense stick rolling, sorting, perfuming and packaging. ITC has introduced a Quality Inspection Manual (QIM), which lays down the scope for checking the materials & final product at each of the stages. This ensures that the final product is the best available that a consumer can buy.Towards ensuring healthy working conditions, masks are given to women working in the Incense manufacturing units. The sorting area is well ventilated with exhaust fans.Thus by this actions ITC is preserving the ancient art of hand rolled incense sticks,imparting the rigors of science into a field that for centuries has been an art Training in terms of fire fighting is also provided. ITC undertakes the trade marketing and distribution of these Incense Sticks under the brand name ?Mangaldeep?. A strong media campaign has been launched by ITC to build its brand of Incense ?Mangaldeep?, and in a short period of time Mangaldeep has become a National brand with a turnover of USD 4.5 million for the year 2004-05. Currently indirectly providing employment to 3000 women across five states.
Innovation
Description of your products or services:
ITC works with Small Scale Industries by empowering them to engage rural women for hand-rolling Incense sticks. This helps the rural women have a supplementary source of income all through the year. ITC has brought about a dramatic change in the working of the Incense industry when compared to the way it used to work earlier by removing the middleman.ITC imparts training to rural women in Incense stick rolling, sorting, perfuming and packaging. ITC has introduced a Quality Inspection Manual (QIM), which lays down the scope for checking the materials & final product at each of the stages. This ensures that the final product is the best available that a consumer can buy.Towards ensuring healthy working conditions, masks are given to women working in the Incense manufacturing units. The sorting area is well ventilated with exhaust fans.Thus by this actions ITC is preserving the ancient art of hand rolled incense sticks,imparting the rigors of science into a field that for centuries has been an art Training in terms of fire fighting is also provided. ITC undertakes the trade marketing and distribution of these Incense Sticks under the brand name ?Mangaldeep?. A strong media campaign has been launched by ITC to build its brand of Incense ?Mangaldeep?, and in a short period of time Mangaldeep has become a National brand with a turnover of USD 4.5 million for the year 2004-05. Currently indirectly providing employment to 3000 women across five states.
Description of the operational model:
ITC works on an outsourcing model for its Incense manufacturing.ITC purchases the final products from the supplier. However, the ITC supplies all the packing materials to the manufacturer & the manufacturer procures the raw incenses & perfume from outside based on ITC?s quality specifications. Incense stick manufacturing process can be briefly described in the following steps. At each and every step rural women are employed.1)Bamboo Cutting 2)Incense rolling 3)Raw Incense Sorting 4)Fragrance dipping 5) Packing ? Retail pouches ITC has supplied rural women in some parts of the country with especially made machines that help in cutting bamboo for usage in Incense manufacturing. This saves a lot of time and also is much safer than the traditional way of cutting bamboo with an axe, which used to result in bruises and cuts Finished goods are transported from all the manufacturing units to a central warehouse in South India. ITC has a very strong foothold in trade, marketing and distribution with a reach to over 300,000 outlets and plans to reach over 30,00,000 outlets over the next three years. ITC has conducted the largest ever sampling with the help of press that reached over 3 million households. A nation wide advertising campaign has also been launched in the national and regional television channels. Point of Sale Material has also been widely distributed and displayed.
Impact
Description of the financial model:
ITC?s ?Mangaldeep? portfolio is designed to suit the buying power of all classes. The Mangaldeep portfolio 4.5 cents for 10 Incense 11 cents for 18 Incense 26 cents for 48 Incense 33 cents for 100 Incense 44 cents for 20 Incense Mangaldeep portfolio is very robust and provides adequate contributions to entire value chain.
Client fees represent this approximate percentage of operational budget:
0%
Key operational partnership:
Conversion model?The Unit purchases the final products from the supplier. However, the Unit supplies all the packing materials to the manufacturer, who procures the raw Incense & perfume from outside based on the Unit?s quality specifications. Principal to Principal?The Unit purchases the finished products from the supplier. The supplier purchases the Raw Incense and fragrance from the vendors recommended by ITC. ITC is partnering with a government organization called Khadi and Village Industries Commission (KVIC), which is a government body whose main objective is creating rural employment.Under this new initiative ITC will partner with KVIC and help in marketing of the Incense manufactured by KVIC certified units. This will provide an addition employment to approximately over 1000 women only in state of Tamil Nadu alone and in a rollout plan of three years will employ over 5,000 women all over India.Brand building and marketing of ?Mangaldeep? incense will be done by ITC. This has a potential to generate sales of over USD 6.2 Million over the next three years using 7050 outlets owned by KVIC.
Current outreach:
We are at the Scaling Up stage. Currently ITC incense business is in the growing stage and we look forward to growing at the rate of 100% over the next two years and at a rate of 50% thereafter.
How many clients have benefited from your product/service in total? Over the last year?:
Incense sticks market in India is valued at USD 225 Million or 60 Billion sticks per annum growing annually at the rate of 7%. The export potential for Incense is pegged at around USD 55 Million. ITC incense business with a turnover of USD 4.5 Million currently has 2% market share and has plans to be the market leader in the next 3 years. To achieve the same ITC has charted out an aggressive growth plan that has direct benefits for generation of rural employment related to Incense manufacturing.
What percentage of your clients is below the poverty line ($2 per day)?
25% Around 25% of our clients are below the poverty line.
What is the order of magnitude of the potential demand for your products or services? Which other low-income groups, countries or regions could benefit from it? Try to quantify (number of clients, market size in currency).
Currently ITC indirectly provides employment to about 3000 women and with the growth plan charted out by ITC we see an opportunity for an additional employment of 15000 rural women all over India.
Scale-up strategy:
How many low-income individuals do you plan to benefit in three years from now? How are you planning to scale up or replicate your solution? What are the major constraints to scale up?
The Incense stick market in India is worth USD 225 Million. Last year ITC sold incense sticks worth USD 4.5 Million. The planned target over the next three years is to touch USD 16 Million. When we say we have to achieve turnover of USD 16 Million it means additional employment to 15000 more rural women. The main constraint is availability of quality raw Incense for which ITC is investing into training of rural women and at the same time looking forward to initiatives like tying up with government organization like KVIC which support rural employment. ITC will be training REGP units in rolling of quality Incense sticks from whom ITC can buy directly.
Which specific areas - and why - in your field would benefit most from investment by corporations, foundations, and other investors:
Investmenst by corporates in setting up micro credit groups, investment in bamboo plantations.
This Entry is about (Issues)
Sustainability
The organization: How does the initiative fit with your overall organization's strategic goals and priorities? How did the initiative start?
At ITC we say, ? Lets put India First?. ITC has partnered the Indian farmer for close to a century. ITC is now engaged in elevating this partnership to a new paradigm by leveraging information technology through its trail-blazing e-Choupal initiative. Additionally, ITC is significantly widening its farmer partnerships to embrace a host of value-adding activities: creating livelihoods by helping poor tribals make their wastelands productive; investing in rainwater harvesting to bring much-needed irrigation to parched drylands; empowering rural women by helping them evolve into entrepreneurs; providing infrastructural support to make schools exciting for village children. ITC?s foray into incense was inspired by the fact that there is a huge market potential to build a brand in Incense market and also a tremendous potential to generate rural employment.
Organization's legal status:
Public Limited Company
Number of Employees:
18000
