Rags to Riches: From Rickshaw Puller to Hospital

As a Class IX student, Hari Kishen Pippal pulled a rickshaw at night, hoping
to fund his education after his shoemaker father was laid low by paralysis. Now
the 56-year-old Dalit owns a state-of-the-art hospital in the Taj Mahal town.

In these parts of western Uttar Pradesh, several Dalit entrepreneurs run hotels,
own factories, even beer bars. But nobody had tried to set up a multi-speciality
hospital before. "I initially thought whether a non-medico like me would be able
to run a hospital. I also wondered whether my caste would be a hurdle. But I
decided to go ahead anyway," says Pippal.

The hospital also employs five Dalit doctors, the entrepreneur's proactive
effort to encourage medicos from his own community. "I want to prove that given
an opportunity, they can be as good, if not better than the rest," says Pippal,
who never went to college but speaks six languages: Hindi, Tamil, Punjabi,
English, German and Russian.

Even non-Dalit doctors working at Heritage hospital maintain it is a great place
to work. "Someone told me, you are a Brahmin, why are you working there? I told
him, I am a doctor and for me, caste is not a factor," says Gaurav Sharma.

Pippal's journey from a single 10 feet by 12 feet home in a shabby basti to a
plush home in the town's upscale Lawyer's Colony - " I have nine
air-conditioners," he declares — is the kind of story that inspires filmmakers.
He started working at his father-in-law's small shoe factory with six workers.
By 1980, he had set up his own company with a bank loan of Rs 20,000. "I named
it People's Export since it sounds the same as my surname," he says. The
entrepreneur admits he didn't want to give out his surname fearing people
wouldn't like to buy his product.

The Dalit entrepreneur made his first million manufacturing and exporting shoes
to countries such as Bulgaria, Russia and Germany. He even supplied Hush Puppies
to Bata. "Thomas Bata visited my factory three times," he says.

But he lost money and shut shop when Germany was unified and east Europe went
through turmoil in the early 90s. He then ran a restaurant and a banquet hall
successfully for sometime. "I ensured that the banquet hall was clean and
well-maintained. It was very successful. The hall hosted many upper-caste
weddings," he says.

Now along with a motorcycle dealership and the hospital, Pippal is aiming to
relaunch his shoes business. "My factory will offer free lunch to all workers,"
he says. The group's overall turnover is around Rs 20 crore.

Pippal feels that most government programmes hardly benefit the schedule castes
due to corruption and leakage in the system. It worries him that the financial
gap between the 'higher' castes and the scheduled castes is increasing every
day. The entrepreneur believes the disparity can be bridged by providing high
stipends to poor students.

"A Dalit student's scholarship should be equivalent to a clerk's salary. He can
study only if he is able to take care of his family," says Pippal.

Then the entrepreneur adds:
"The world is ready to bow before you. But you have to work hard to make it happen."


 
Source: indiadaily.org

The amazing success story of Fabindia

Ethnic weaves: In the tiny village of Chanderi in the Ashoknagar district of Madhya Pradesh, there is little respite from the scorching summer heat as the mercury touches 42 and 43 degrees celcius. There is a preponderance of dry dust on the barren land, which has not seen rain in months.

There is shortage of water, with daily tankers meeting the local people’s meagre needs. The local population, which includes 1,000-odd weavers, could still have coped, but the mortal blow is looming in the form of disappearing demand for their cherished fabric, chanderi.

Yet, in the face of impending doom, there is an air of hope, anticipation and excitement in this sleepy little village, as 455 weaver families are poised to become owners of shares in a community-owned company, a concept totally alien to all except the few educated youths here.

Mohammed Zuber Ansari, 28, has a master’s degree. After failing to find a job, he found himself in front of a loom and is still trying to come to terms with the developments. “We bought shares for Rs 1,000 and all I know is that this could change our lives in some way.”

That way has been paved by Fabindia, a retail outfit that has grown from one store in the mid 1990s to 85. Dabbling in fabric, apparel, handicraft and other products, it began an experiment with community-owned companies nine years ago in an attempt to include artisans in the wealth creation process.

Harvard School case study!

The concept, now a Harvard Business School case study, is simple. A fully-owned subsidiary of Fabindia, Artisans Micro Finance, a venture fund, facilitates the setting up of these companies, which are owned 49 per cent by the fund, 26 per cent by the artisans, 15 per cent by private investors and 10 per cent by the employees of the community-owned company.

The investment by these four categories of investors provides the paid-up capital. The company promotes the sales of its artisan community to Fabindia, which is the principal buyer. Eventually the companies will sell to other buyers, too. Haryana and Faridabad have already started independent sales.

After expenditure and tax are deducted from the principal sale value for the year, the year’s profits before and after tax are worked out. Based on this, the valuation of the company and its enhanced share value can be calculated.

The artisans gain in many ways. The value of their shares goes up. They earn dividends when the company is in a position to declare them. Eventually the company will try and offer loans to the artisans, arranged through banks.

Community-owned companies

The loans can be used to buy new looms or expand production of other products. An internal trading mechanism will allow artisans to trade their shares.

Although the villagers see it as a gamble, there is already evidence that it works. A community-owned company promoted a year ago in Jodhpur with a paid-up capital of Rs 34 lakh (Rs 3.4 million) is valued at Rs 1.10 crore (Rs 11 million) . The company, which totted up sales of Rs 5.7 crore (Rs 57 million) and a profit after tax of Rs 22 lakh (Rs 2.2 million) in its first year, has 2,300 artisan shareholders.

Each of their Rs 100 shares is worth about Rs 300. As many of them hold 10 shares each, their investment of Rs 1,000 has tripled to Rs 3,000, an escalation they couldn’t have dreamed of. Through a complicated internal trading system, an artisan can – if he wishes – recover his investment.

Chanderi and Jodhpur are just the beginning. So far 18 community-owned companies have been set up with 6,000 artisan shareholders. Fabindia hopes to set up 100 such companies by dividing its supplier base into clusters. Eventually, the 100 companies will cover 100,000 artisans across 21 states.

Nurturing Hand

Fabindia’s managing director William Bissell, who conceived and steered the model, says that unlike many Indian companies he doesn’t believe in setting up a department to promote corporate social responsibility.

“If one is very serious about CSR, you may have a vice-president heading it. I find a lot of people doing doublespeak. This creates dissonance both within the organisation and outside. This inclusive approach defines our brand and gives it great value. If you do what you believe in, it defines you,” he says.

He is convinced that involving artisans and sharing the benefits of growth with them is the most sustainable of all models. Without that, the market-based system – in his view it is the best system to alleviate poverty – is in danger of being “discredited”.

He quotes Raghuram Rajan’s book to argue that India has moved from phony to crony capitalism and that no one is giving real capitalism a real chance. “If capitalism is inclusive, its chances of getting a bad name go down,” says Bissell. He is giving the final touches to his own book, ReImagining India.

Big plans ahead

The shares offer the artisans a divisible asset class (land can be divided but its divisions are often disputed and jewellery is largely indivisible) and community-owned companies help convert Fabindia’s artisan base into an asset.

“These are not things one can measure on a balance sheet but I do believe that eventually, if we can convert our suppliers or artisans into these community-owned companies, it will be a very strong asset for Fabindia,” says Bissell.

But the model is not desirable from a social point of view alone. Fabindia has moved from being a primarily export house in the 1960s to a turnover of Rs 300 crore (Rs 3 billion), of which 90 per cent is domestic sales. Its aim is to be a “lifestyle alternative to the mass-produced”.

From soap and organic food to clothes and furniture, it claims to provide ‘natural and eco-friendly’ options. These options are sourced primarily from craft-based processes. While the company doesn’t set targets, it is looking at growing to 250 stores in four years.

Element of the hand

Artisans Micro Finance director Smita Mankad quit ABN Amro to do something she believed was worthwhile. “If you want to grow at the pace we have grown, you have to carry your supplier base with you,” she says, emphasising that Fabindia’s growth will be hampered unless the artisans grew with it.

Everything Fabindia sells has the “element of the hand” in it, so one can’t step up production overnight like in China’s mass-produced factories. The community-owned companies offer the persons owning the hands a better life, such as, by providing an alternative to the local Shylock.

“If he wants to get his daughter married and needs money, he can sell his shares and realise the appreciation. He can also take a loan by offering his shares as collateral,” says Bissell.

Making a big difference

Fabindia is changing the way the artisans work, the new model is changing the way Fabindia works. The typical central warehouse system has given way to several warehouses owned by community-owned companies from which goods travel directly to stores across India. This reduces logistics costs and minimises the role of middlemen.

While the system seems to be working for all concerned, challenges remain. One of them is developing secondary markets so that the companies can stand on their own feet.

Critical to that will be introducing a “consciousness” of the design element in the artisans so that their products have a wider appeal. Bissell says the model will depend on the artisans beginning to understand the benefits of joining together in something that’s not a cooperative.

“A cooperative imposes many restrictions upon them and doesn’t give them much in return. If you get together, you must create something that’s bigger than the sum of the parts.”

That seems to be happening in Chanderi. Ansari says his family of seven had tired of poverty and an uncertain future. Weavers were down to earning Rs 13 a meter and haggling with the “seths” on a per saree basis. Payments were erratic. His fellow weavers had begun to leave the village in search of alternative livelihoods.

A Unido project tried to help, but FabIndia’s entry made the biggest difference as it began to source fabric worth Rs 1 crore (Rs 10 million) a year from Chanderi. The realisation has risen to Rs 23 a metre. Ansari’s two looms are busy all day. Safely tucked away are 10 shares and the promise of a better future.

Courtesy:- Rediff

Unheard cobbler starts his own journal

Not a single newspaper reported about us, then I realised that I have to start the revolution myself and that is why I took out this paper. Bhopal: What happens when you want someone to tell your story but no one is listening? You start your own mouthpiece! That's what a Dalit man, Suresh Nanmehar, was forced to do. He is a cobbler and also brings out a newspaper that addresses Dalit issues. In 2003 cobblers, most of who are Dalits protested for almost a month demanding better facilities. It was an event ignored by the local media, something this man vowed would not happen again. ''Not a single newspaper reported about us, then I realised that I have to start the revolution myself and that is why I took out this paper,'' said Suresh Nanmehar, Edior, Baal Ki Khaal. In the past six years, the circulation of the paper has gone to eight thousand. The two-rupee paper has no space for rapes and murders but focusses largely on Dalit issues and problems of the economically backward. Most writers are Dalits who do this for free. ''It has so many topics that you do not find in other papers,'' said Mukesh Dangi, reader. The paper costs nearly Rs 6000, most of which comes from the Dalit community and now the State Government has also started advertising in it. Suresh Nanmehar pleads with his community, urges them and sometimes threatens them to stand up. He asks them to get educated to fight for their right, with his newspaper of course, fighting a battle for equality with words. (Source: NDTV dated 17 June 2008)