Abstract
With the FDI in retail knocking at the doors of the major Indian
cities, here is a study on how already the organized sector has impacted
the way shopping is done in India. With the long history of clustered
selling of products, known as traditional bazaar, the historical
depiction of India has been through its narrow running streets covered
quarterly on both sides by the goods latching on the passers. This case
is an analysis of one such traditional cluster market for Jaggery in
Punjab.
The history
According to Mr. Dhamija, a fourth generation shopkeeper at
Gur Mandi, the Market is celebrating the 134
th
Dussehra festival this September. Nonetheless, like any other part of
the country, these festivals are the life lines for the market since the
times of his ancestors. He recalls how in the past, the customers were
especially attracted by the size of the ‘Raavan’ statues that were
procured by the
gur mandi shopkeeper’s union. His father used
to give VIP passes to the special customers, who would come along with
their families from far off places to attend the celebrations.
Defining the place
Gur Mandi in Jalandhar is a traditional market place for jaggery, locally known as
Khandsari,
and is situated in the heart of the city. The market is made up of thin
streets curving every now and then, and giving way to the heaps of the
jaggery standing tall outside the wrinkled shops. The sight of the
market embarked with the presence of bumble bees all around the heaps of
jaggery is mouth watering phenomenon in itself.
The market has traditionally been the center point for the jaggery trade in
Doaba
region of Punjab, but with the passage of time, a part of the market
started accommodating some other commodities which included bamboos,
brooms, organic ropes (locally known as baans, jhadus, bagar
respectively) that were transported from eastern parts of the country
(present day West Bengal & Bangladesh). Hence the present-day
Gur Mandi is the amalgamation of
Khandsari (sugar related) products and the
Bansa-Bazar (Bamboo market).
Traditional buyers
“But the scenario has changed now,” Shopkeeper 1 recalls “there used
to be a time when the wholesale merchants from different parts of
Punjab, especially Kapurthala, Bhogpur, Adampur, Phagwara &
Jhandu-singha would pay frequent visits to the market. They would take
away bulk orders for
gur (Jaggery). The trucks used to be
stationed at almost walking distance from our godown.” With a twist in
his eye-brows he raises his head towards the ceiling, and adds “But who
would like to consume Jaggery these days? Now people ask for it,
occasionally. Just for a change of taste. Now they depend completely on
Sugar – almost certainly. The major chunks of customers, who still come
to us, are the village
baniyas, who buy Sugar in bulk, but rarely do they come for Jaggery nowadays. But you know still we call it
Gur Mandi, not
Cheeni mandi”. And he bursts out in a healthy laugh.
According to an estimate of the various shopkeepers of the market,
around 80% of the buyers are wholesalers from nearby villages, who come
here to buy sugar and bamboos. There is only a small minority of buyers,
primarily the local people who do come for traditional products ranging
from Jaggery, Bamboos and brooms in addition to rather modern versions
i.e. sugar and plastic wipers.
Kind of marketers
Like Mr. Dhamija, several other shopkeepers of the market are the
fourth- fifth generation children of the founders of this market.
According to shopkeeper 2, “All the shopkeepers in this market are close
relatives, cousins or real brothers. Our primary aim is to keep these
old traditions fit and alive.”
Fig. 1: Showing the traditional ambience of the gur mandi
Market Competition
Internal
According to the shopkeepers of the market, there is no internal
competition between the market players. Given the fact that they are all
close relatives, all of the players stock the sugar coming from
different mills. In addition to this, everyone has his own customer
base, and his own area in terms of villages, towns to which they cater
to most of the times. Hence, there is little scope for any internal
competition in that sense.
External
In the past one decade, Indian retail industry has seen a series of
entries from the big players. Its impact is being felt by almost every
commodity. According to Mr. Dhamija, “The entry of retails giants like
Reliance Fresh and Easyday in the city has no doubt changed the shopping
habits of the people to some extent, but still the majority of people
like to visit the market, because they are used to the way they have
been shopping.” While in contrast to this, shopkeeper 3 says, “There is
certainly a decrease in the foot fall in the market for buying sugar.
People now prefer to buy it from the nearby retail outlets, where they
can get everything in an organized form under one roof itself.”
But in case of jaggery business, everyone in the market seems to have
the same voice. The jaggery sold in this market is unmatched; hence
there is no external competition what so ever in this regard. In case of
sugar also, since the majority of buyer are the wholesalers from nearby
villages, they tend to buy in the same fashion as before. So in terms
of competition, the effect is still very low.
Strengths and Weaknesses of this format
The strength of this format of market is based on two main pillars.
First is the relationship based marketing and the other one is the
credit facility. Since the majority of the buyers are wholesalers
themselves and there is a bulk dealing involved, the age long personal
relations are very important. In addition to it, the credit facility due
to the mutual trust and cooperation is very handy in retaining the big
customers.
The most important strength of this market in one sense is its
Product Differentiation, which is nonparallel in itself. The shopkeepers
claim that, the quality of Jaggery produced in Punjab, and also in
Jalandhar region, is best in whole India. The sugarcane in Punjab tastes
the finest; hence the Jaggery produced from it is known to be the best.
The demand for this Jaggery comes from foreign countries like UK,
Canada, USA, Saudi Arabia, Australia, etc. Especially the NRI’s of
Punjabi origin, settled across the globe, often miss the taste of
Punjabi Jaggery.
When asked about the demerits that this type of market format shares,
the shopkeepers unanimously raised the issue of the congested space and
the parking problem in the market. According to them,
Fig. 2: Showing the heaps of solid and powdered gur called shakkar in the gur mandi.
most of the buyers these days are short of time. Hence they cannot
afford to waste time in long traffic congestion in the market. Since the
market is situated in the heart of the city, there is no scope of
expansion in terms of the space. Being an unorganized market place it is
turning out to be a problem for the marketers.
Value propositions
Product differentiation
The high quality Jaggery available in
gur mandi is not available in any of the retail stores like reliance fresh or easyday.
Gud mandi offers different types of jaggery, which are often specialty products. Examples: jaggery with
sauf coating, jaggery with
hing (good for digestion), jaggery for animals (sub-standard product) and jaggery with other ingredients of medicinal value.
Trust
The kind of relationship the marketers of the
gur mandi have
built up with the wholesale dealers, regular customers and the
suppliers is a result of years of interactions. This gives them edge
over the new entrants like shopping malls, retails stores, etc.
Wide acceptance
Gur mandi is a famous brand for jaggery. As already
discussed above, people from all over Punjab, Delhi, and nearby region
have been loyal customers of the jaggery distributed from here. NRI’s of
Punjab origin, especially, get attracted to it.
Proximity to resources
This
mandi was built here keeping in mind that it is the
central point for all the big sugar mills of central Punjab region. Good
transportation channel of Jalandhar both through railways and roadways
makes it an ideal market for distribution.
Distribution channel adapted keeping it in center
The distribution channel for sugar in Jalandhar region was designed keeping the
gur mandi
in cent re, so as to ease the flow of sugar/jaggery to nearby towns and
villages from the mills. Hence this prevented any competitive market to
develop in competition to it, even today.
Threats to the survival of the market
In additions to the parking and space problem, the other big problem
faced by the marketers is in regard to the decreasing yield of the
sugarcane in the Punjab which poses threat to the market as a whole. The
only alternative left is the import from the state of Uttar Pradesh,
which would be a costly affair for them. And also it has been observed
that the Jaggery produced from sugarcane of Uttar Pradesh, tastes much
different than that of Punjab.
| Commodity |
Earlier |
Now |
| Jaggery |
Shopping product. |
Specialty product. |
| Sugar |
Low demand (considered impure). |
Everyday commodity. |
Table 1: showing the contrast between market condition of gur mandi 35 years ago and present day.
The demand for Jaggery has shrunk to 0.1% of what it used to be three
four decades ago. According to shopkeeper 1, “My father used to sell
2000
tore* of jaggery everyday. But the substitution of Jaggery by sugar has made the daily demand of Jaggery to shrink to less than 2
tore a day.”
‘How will such format continue?’: The Survival Tactics
Weaknesses turned into strengths
Shopkeeper 1 says, “Around six years back, survival in this format
was becoming difficult for us. But we thought it was best time to
introduce a change. We introduced Kirana wholesale, along with that of
the Jaggery and sugar. We used same distribution channels, same
customers, and same storage & transportation facilities to expand
our product offerings. Now we also deal in pulses, flour, and general
FMCG products.”
Shopkeeper 2 says, “My son is educated and he wanted to use his
expertise for the betterment of our business. We first took an agency
for
masala (spices). We were already supplying the sugar and
related products in bulk for parties and marriages. We decided to use
our same knowledge and expertise in this field. And now my son
successfully started the catering service for marriages and other
parties.”
| |
Earlier |
Now |
| Position in distribution channel |
Wholesaler . |
Provide retail also. |
| Commodities dealt |
Jaggery, Sugar. |
Addition of Kirana, Spices, FMCG’s, and other services. |
Table 2: showing the contrast between market condition of gur mandi 35 years ago and present day.
Shopkeeper 3 says, “Keeping in mind the changing needs of the people,
we have adapted ourselves. We used to specialize in the organic ropes
used for making
charpais (rope beds), and broom sticks. But
since the technology changed, we now specialize in good quality folding
beds (made up of polymer strips) and plastic floor wipers. The business
has flourished in this way.”
| |
Earlier |
Now |
| Position in distribution channel |
Wholesaler . |
Provide retail also. |
| Commodities sold |
Bamboos, organic ropes, broom sticks. |
Shift to Plastic made products like floor wipers, folding beds, ropes etc. |
Table 3: showing the contrast between market condition of Bansa bazaar of gur mandi 35 years ago and present day.
Road ahead
Most of the shopkeepers in this market have started offering hybrid
products and services. They have tried to retain the same customer base
and have utilized the same existing distribution channel by adapting
themselves to the upgrading technology, and hence the changing needs of
the customers.
Shopkeepers here have very little idea on what would be the future of
the market. The only thing they anticipate is some kind of help from
the government. But more than that, they feel that it is only the
customers who can decide their fate. Their interests and taste is what
derives any market. There are still many buyers who love to visit
gur mandi
often, because the place still captures their childhood memoirs.
Certainly, they feel that the aroma of place is diminishing rapidly. How
long will the magic of aroma work? After all it is just a matter of one
more generation to pass through.
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*1
tora = 40 kg
(Link: http://www.panelamonitor.org/documents/500/diffusing-aroma-jaggery-curious-case-gur-mandi-jal/)
