In our given scenario today, a majority of the rural customers are deprived of modern technology and solutions to their basic needs of light and energy. The rural poor have to live without solutions targeted to their needs,in the absence of a mechanism that can reach them.Another main reason is the absence of a suitable and viable systematic approach. At present villages in India are very poorly connected. Almost all the companies see rural reach as a loss-making proposition. TARAhaat joined hands with Shell Foundation under the Shell Breathing Spaces Program to develop a commercial viable distribution strategy, which will become a worldwide model for rapid and sustainable replication of low smoke-emitting, energy - efficient and effective cook stoves. Shell Foundation is providing the initial funding to support the creation of the infrastructure and scaling up of the network for achieving commercial viability.
Our learning on distribution has given us clear cut understanding of the TMA (TARA Marketing Associate) model to reach targeted number of households. We are working through a model where Distribution Services will appoint and train Rural Unemployed Youth as TMAs on a 100% commission based programme. Once these TMAs are well equipped with product training and selling techniques they will move to their respective cluster of 20 villages to sell cooking stoves designed by Development Alternatives. The prime objective of reaching one million households will be achieved through this strategy alone. To achieve the said target TARAhaat will open 52 districts.
Recently, Development Alternatives and TARAhaat tested its cook stoves
both with chimney and without chimney. Chimney Stove –called
Saral – Single Pot and made of Concrete, Pottery Liner Stove (PLS) both
single pot (I) and twin pot (II). Without Chimney Stove -
Improved Brick Stove (IBS), TARA 101D (Mixed Fuel i.e. Dung Cake 70% :
Wood 30%) & Ceramic Liner Stove (CLS). As per the Shell Foundation PLS
I, II (known as Do It Yourself – DIY) and IBS (with 12 cm diameter) meet
up to their set standards. Both the stoves i.e. PLS and IBS are still to
do so. From our experience of selling the SARAL (Single Pot) cook stove, we found that the customer liked the product.He/she perceives its value for money as it has various alternative components.It is made of concrete with a chimney (two pieces of 6 feet each), cowl, rain protection sheet, grate and stopper. Once it gets installed the chimney is seen as a symbol of status in the village. But because of certain ground realities this cook stove could not make much success. Stated below are a few of those ground realities: n It is made of concrete so it absorbs the heat and that increases the cooking time. n The chimney takes out the smoke emitted during cooking but the lead time between ordering and procurement of these pipes is approximately 40 to 50 days depending upon the weather. n Breakage loss while transporting these pipes at both the levels (also called multiple dropping). v First level i.e. from manufacturer’s point to first level warehouse. v Second level i.e. from warehouse to village level warehouse. n Time cost of TMA: the installation cost is very high - which he can’t afford since he is on 100% commission. n To make the distribution business viable, one needs to properly plan the transportation/ multiple dropping of cook stoves. Overall the supply chain becomes so cumbersome because of chimney loading,unloading,breakage, warehousing etc. that it collectively adds to the overall supply chain cost.Hence,the entire food chain gets impacted. n Excessive weight of the cook stove is another major cause of non acceptability. So TARAhaat, finally had to stop the sale of SARAL in the month of February 06. After that Development Alternatives and TARAhaat developed PLS (I&II), IBS and TARA 101. Shell has sent their team to test these stoves against their parameters and except for TARA101; we succeeded in passing their set standards. PLS (I&II) - It is a chimney stove and the lesson the TARAhaat distribution team learnt from the distribution of SARAL (chimney cook stove) had kept us from scaling up the chimney as - n The perception value of this cook stove is not commensurate with the MRP. So customer doesn’t see it as value for money. n The installation process takes five to six days to get this stove ready for use. Hence, its a time consuming process for the TMA n Since it is made of pottery, breakage during transpiration is unavoidable and this erodes margins. n As these pots are made of clay, there is shrinkage during the drying process which varies with climatic conditions. Hence,it is very difficult to maintain standardization in the dimensions as it directly affects the performance. IBS - Shell Foundation has cleared IBS with a fire chamber having a diameter of 12 cm. We are working in areas where the staple food is chapati ( roti) and people use mix fuel i.e. dung cake with wood and the proportion of wood is not more than 30%. So from the customer’s point of view the fire chamber needs to have a diameter of minimum 16 cm and Development Altenatives is working on it and doing testings to clear the Shell standards. DA is also facing certain issues related to manufacturing of bricks which TARAhaat expects will be solved shortly. TARAhaat is expecting this product will be available to them for scaling up very soon.
TARA
101D –
It is a metallic stove made of iron
sheet and it is without chimney. are developing this cook stove as a secondary stove for the customer. At present Development Alternatives is also doing a lab testing on this stove and is yet to give a green signal for scaling up. CLS – This stove is made of different clays. It is also a chimney-less stove. DA has approved to scale up this stove and TARAhaat is going to proceed with this product very soon.Since this product has been designed and is going to be positioned for BPL (below poverty line) segment, TARAhaat is expecting a good rate of penetration.
TARAhaat
has developed detailed Product Market Index (PMI) and handed it over to
DA to develop Product Technical Index (PTI), on which Development
Alternatives is working. The sale of Improved Cook Stove (ICS) will require cutting edge marketing and awareness building. It is well said that “little knowledge is always dangerous”,as is evident from the lack of awareness among the rural consumers about IAP (Indoor Air Pollution)issues.As a consequence,the rural people are still using the readily available unprocessed biomass based fuels since the ICS products costs many times more than the traditional ,polluting cook stoves.The Shell Breathing Spaces Program requires financing strategies for a number of stakeholders. TARAhaat, as the manager of the programme, has to ensure that funding for its working capital requirements are met until the programme looks for its self sustainability or market based financing. It has been identified that in the entire food chain, TMA is the last leg or key to close the loop of sale. So to make this kitty viable TARAhaat and DA have closely worked with Philips to design lighting products for the rural customer. Philips has succeeded in achieving this by making two products i.e. Kiran and Uday. On May 16, 2006 TARAhaat and Philips jointly and successfully launched these products at Guwavali village (Niwari Block). Kiran – Windup Flashlight, the torchlight that works without dry cells. It is Dynamo Tri-LED flashlight. One minute winding gives approx. 30 minutes of light with one LED and 15 minutes of light with three LED on. It is ideal product for homes and outdoor use.
Uday – Rechargeable Lantern,
it comes with a unique
Six Watt CFL – I DC lamp that gives maximum light. For the first time in
India, Philips Uday is built with an electronic circuit that allows for
high-speed charging and longer use than other ordinary rechargeable
lanterns.
Both the products are very good and have met with customer approval. Kiran is being widely accepted by the customers and TMAs are happy to sell it and earn a good commission. Uday is a good product, but because of its high pricing, is not accepted by the customer - this observation has been shared with DA and Philips. Again the issue of value for money comes into picture. It has been explained to Philips that Although Uday satisfies the need of its customers, the fact that it is has been over engineered and over priced is why the customers are not buying this product. We are all waiting for the festival season when there should be some movement of Uday. ICICI Lombard General Insurance Company Ltd is another player who contributes a significant share in the TMA’s commission kitty. In March, TARAhaat successfully launched and rolled out the following products to their rural customer through their respective TMAs. General Personal Accident (GPA) both Individual and Group, ICICI Sampoorna (Health Insurance), Motor Insurance. TARAhaat - Distribution Services has so far trained more than 60 TMAs and reached more than 750 households in Lalitpur, Jhansi and Tikamgarh district. TARAhaat is going to tie up a business venture with SCOJO Foundation by October, 06. Scojo Foundation offers spectacles to villagers at low prices. The reading glasses are for those who are suffering from presbyopia (people suffering from age related vision problem). Scojo trains people to provide basic eye screenings and dispense affordable reading glasses and refer those in need of more comprehensive eye care to an eye clinic. Scojo is desirous of providing presbyopia solution through the network of Distribution Services. Once this starts it will add to TMA’s product portfolio and result in good commissions. While TARAhaat has recruited and developed a highly qualified cadre of professionals, the scope of the Breathing Spaces Program requires further recruitment of a number of additional resources to deliver the targets committed in the programme. The process of recruiting these individuals has been on since August, 06. In Training, TARAhaat – Distribution team has developed effective sales training programmes. These programmes need to be adapted for large scale delivery and converted to Computer Based Training (CBT) programmes.This in turn will reduce the cost of delivery and ensure optimal quality standards to address the needs of the Shell Breathing Spaces Program. q Vipin Sharma vsharma@tatahaat.com
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