Value Chain Analysis of Mirpur Benarasi Saree Industry

Value Chain Analysis of Benarasi Saree Industry in Mirpur

SUPERVISED BYDr. MD. Noor Un NabiAssociate professorBusiness Administration DisciplineKhulna UniversityKhulna

PREPARED BYSami-Ur-RashedinID-060347

(Submitted in partial fulfillment of the requirement of BBA Program)

2

About the study

oThe study was interesting and insightful oIt was challengingoThere were many opportunities for learning and applying the knowledge I gathered during my 4 years academic life in Business Administration Discipline.


Value Chain Analysis of Benarasi Saree Industry in Mirpur 3

PRESENTATION OUTLINEBackground of the Mirpur Benarasi Saree Industry

Current condition of the Benarasi Saree Industry in Bangladesh

Objective, Limitations and Scope of the study

Methodology

Conceptual framework SNA

Value Chain of the Mirpur Benarsi Saree Industy

Condition of the Backstage of the Mirpur Benarasi Saree Industry

Social Network of the Handloom Owners of the Mirpur Benarasi Saree Industry

Conclusion


4

INTRODUCTIONBackground of

the Mirpur Benarasi Saree

Industry

Current condition of the Benarasi

Saree Industry in Bangladesh

Objective of the study

Methodology Limitations of the study

Scope of the study


5

Background of the Mirpur Benarasi Saree Industry

-The origin of Benarasi Saree is a northern city of India called Banaras.

-Dhaka set up it’s own Benarasi industry in 1930s

-Main outlets were in Islampur, Sadarghat market and old town

-After the separation of India and Pakistan,Muslim community of Banaras came to this part with there hanldlooms.

-They set up Benarasi industyr in Mohammadpur and Mirpur area

-The handloom were made by wood, bamboo and small metal parts. To run the looms human labor was used.

-This process is still same


6

Current condition of the Benarasi Saree Industry in Bangladesh

-The Benarasi workers of Dhaka city are mostly concentrated at the section No-10, No-11, No-12 of Mirpur.

-According to the BHB and Benarasi Palli Owners Association at present there are around

1000 owners10,000 weavers25 designers25 color masters5000 support staff

In 2006 Bangladesh Tant Board allocated Tk 45 lakh for 249 looms at nominal interest rate for distribution among the weavers.

-However, the fund did not reach the genuine Benarasi craftsmen-benefited many non-craftsmen (internal migrants) who used the low-interest loan to set up looms there.

The price of raw materials is still soaring, government has no marketing policy to export Benarasi abroad and the workers are simply plunging into the black hole of poverty


7

Objective of the study

THE REPORT IS PREPARED TO SERVE THE FOLLOWING OBJECTIVES

Draw a value chain map of the Mirpur Benarasi saree IndustryUnderstand the current condition of the backstage of Benarasi saree industry in Mirpur.Understand the social network of the handloom owners


8

SCOPE OF THE STUDYHigh profile stakeholders could not be reached. Producers from outside Mirpur could not be reached Government officils/representative were not

interviewed

LIMITATIONS OF THE STUDYStakeholders outside the geographic area of my study Withholding of information Lack of education of the respondents


9

Methodology

The report is prepared through a qualitative approach. To understand the value chain qualitative approach was needed. The data collection process was two staged:

STAGE ONEInterviews on all type of stakeholders involved in the industry

STAGE TWOInterviews conducted on the handloom owners

The data were then analyzed to draw the value chain map and put into Visualyer to find the social network


10

Methodology (contd.)

DATA TO ANALYZEPrimary data- Primary data were collected from depth interviews and questionnaires. The questionnaire was based on qualitative research and social network literatureSecondary data- secondary data were collected from reports, articles, research papers, newspapers and internet.

SAMPLE-No fixed sample was selected as it was not known how many types of agents will be found. -After the value chain could be mapped, 35 handloom owners were interviewed to understand the social network of handloom owners


11

CONCEPTUAL FRAMEWORK SNA

Social Network Analysis

SNA Software Metrics of Social Network Analysis


12

Conceptual framework SNA (contd.)

SOCIAL NETWORK ANALYSIS-A social network is a social structure made up of individuals (or organizations) called "nodes", which are tied (connected) by one or more specific types of interdependency, such as friendship, kinship, common interest, financial exchange, dislike, sexual relationships, or relationships of beliefs, knowledge or prestige.-The nodes to which an individual is thus connected are the social contacts of that individual


13


SOCIAL NETWORK ANALYSIS SOFTWARE -SNA software is used to identify, represent, analyze, visualize, or simulate nodes (e.g. agents, organizations, or knowledge) and edges (relationships) from various types of input data (relational and non-relational), including mathematical models of social networks. The output data can be saved in external files. Various input and output file formats exist.


14


METRICS (MEASURES) IN SOCIAL NETWORK ANALYSISSNA software provides us with many components which can be used to analyze the network.

Betweennes, Bridge, Centrality, Centralization, Closeness, Clustering coefficient, Cohesion, Degree, Density, Flow betweenness centrality,

Eigenvector centrality, Local bridge, Path length, Prestige, Radiality, Reach, Structural cohesion, Structural equivalence, Structural hole


15

FINDINGS AND ANALYSIS

Value Chain of the Mirpur Benarsi Saree Industy


Social Network of the Handloom Owners of the

Mirpur Benarasi Saree Industry


16

Value Chain of the Mirpur Benarsi Saree Industry

is a physical representation of the various processes that are involved in producing goods (and services), starting with raw materials and ending with the delivered product.

Value chain

distinguishes two important elements of modern value chain analysis. -inbound logistics, operations, outbound logistics, marketing and sales, and after sales service-strategic planning, human resource management, technology development and procurement

Porter’s Value chain

17

Value Chain of the Mirpur Benarsi Saree Industy (contd.)


Porter’s Model was not used in determining the value chain of Benarasi saree industry in Mirpur because of the informality that persists in the industry

Rather, the study tried to find the links from buying raw materials to purchasing a saree. Then the links were connected to draw the value chain.

To find the links and to connect them, depth interviews were conducted among the stakeholders of the industry


18

Agents of Benarasi Saree Industry in Mirpur

Customer

Importer of raw silk and Jori Purchaser of raw silk and jori Twisting

Color master Tana maker Nuri maker Chumki/Puti seller

Designer Puncher Makers or Weavers Cutting

Polishing Shop owner

BANA MAKERS

CUSTO

MER

NURI MAKERS

COLOR MASTERS

PUNCHERDESIGNER

HANDLOOM OWNERS

TANA MAKERS

SHOP OWNER

JORI/PUTIPURCHASER OF SILK

RAW SILK BUYER

(TYPE 2)

RAW SILK AND JORI

IMPORTER

Twisting

TWISTING

Handloom

Value Chain of Benarasi Saree Industry in Mirpur

RAW SILK AND JORI

BUYER (TYPE 1)

CUTTIN

G

POLISH

ING


20

Findings from the Value chain of Mirpur Benarashi saree Industry

oThe value chain is short if compared with other industries having same amount of financial transactions.

oThis chain has very low time management issues. Meaning there is no issue of having any kind of loss if any part of the chain becomes slow.

oAs the making of the sarees has a fixed system, no matter how fast the earlier stages work, the making will take its fixed time.

oThere is an entry barrier in the backstage of the industry but there is no entry barrier in the front stage of the industry.

oThe price of the major raw materials is controlled by only a few people which ultimately impacts in increasing price of the sarees


21


Lack of weaversDuring the disastrous condition that prevailed 7/8 years back many weavers left this profession. They are now doing other works to earn and livelihood and do not consider to come back.

Settlement problemMost of the backstage people are from Bihari community.They can’t expand their business.The allocated land wasn’t handed over to them and still under red tape.

Low wageThe workers of this industry are paid low.Can’t manage to save anything

Poor work conditionWorkplace is very small and congested.Have to work more than 12 hours a day


22

Condition of the Backstage of the Mirpur Benarasi Saree Industry (contd.)

Unpleasant Owner-worker relationship Owners don’t pay fair wagesGood work is not appreciated

No trade union for workersWorkers can’t raise voice against injusticeDon’t have a bargaining power for fixing products price

Lack of promotionNo steps from the government to promote this industryNo private organizations to promote this industry.Only the Boutique houses are promoting this products

Inconsistent incomeIncome is not same around the whole year


23

Condition of the Backstage of the Mirpur Benarasi Saree Industry (contd.)

Increasing raw material price Price of raw silk and jori increases every year (or every months)e.g. per kg raw silk price now 5200 BDT which was 2700BDT last year

Availability of cheap Indian Benarasi Sarees Indian sarees are cheap but design is betterThose are made in power looms which reduces labor costIndians use native raw materaial which saves them import duty

Increasing Benarasi production in other areasManikganj, Sirajganj, Tangail, Ishwardi etc. are producing low quality, low cost Benarasi saris with reduced labor cost and sub standard fabric

High profit margin taken by the shop-ownersShop owners sell sarees at a much higher price than what they pay to the producers


24

Social Network of the Handloom Owners of the Mirpur Benarasi Saree Industry

As the nature of their business was same, these 35 handloom owners’ answers provided with the social network that can be used to understand the nature of all handloom owners social network

To prepare the social network of the handloom owners of Mirpur Beanrasee saree industry 35 handloom owners were interviewed with a structured questionnaire.

Through the questionnaire, the persons with whom handloom owners communicate (for their business purpose) was found.

25

Social Network of Handloom Owners of bBenarasi Saree Industry in Mirpur


26

Social Network of the Handloom Owners of The Mirpur Benarasi Saree Industry


Male 82.377% Female 10.656% Store 5.328% Unidentified 1.639

Profession Percentage

Shop owner 6.148% Weaver 31.967%

Tana fixer 3.689% Nuri maker 7.377%

Raw Jori supplier 2.049% Chumki/Puti 4.098%

Bana maker 4.098% Cutting 4.508%

Color Master 4.098% Handloom owner 8.607%

Designer 4.508% Polishing 2.869%

Machine fixer 4.098% Tana Maker 6.967%

Raw silk supplier 1.230% Thread supplier 2.049%

Total links: 354

27



Closeness Centrality (for undirected graph):Node Farness Closeness Normalized ClosenessAVG: 1041.648 -0.003 219.146%STD: 192.783 0.143 2161.900%MIN: 0.0 -1.000 0.000%MAX: 1266.0 1.000 24000.000%Maximum possible closeness: 0.004

Degree Centrality:Node Degree InDegree OutDegree Degree InDegree OutDegreeAVG: 2.410 1.205 1.205 0.992% 0.496% 0.496%STD: 3.704 1.020 3.851 1.524% 0.420% 1.585%MIN: 0 0 0 0.000% 0.000% 0.000%MAX: 25 9 23 10.288% 3.704% 9.465%

28



Betweenness Centrality (for undirected graph):Node Betweenness Normalized Betweenness)AVG: 404.256 1.375%STD: 1073.291 3.650%MIN: 0.000 0.000%MAX: 6654.732 22.633%Maximum possible betweenness: 29403.0

Positions of the agents in 35 handloom owners social networkAnd

Opinion leaders among agents in 35 handloom owners social networkare provided in the appendix of the report.


29

CONCLUSIONoBenarasi industry has overcome the disaster that it faced around 7 years backoDemand for Bangladeshi Benasari saree is increasingoProper steps need to be taken as early as possibleoIntense value chain analysis can provide with more insightsoSubsequently a more deep, broad and updated social network analysis of the industry can help provide with information necessary to develop this industry


30

THANK YOU

Documents

Value Chain Analysis of Mirpur Benarasi Saree Industry