Presented by:

Students of MET PGDM

Honey Production in Local Economy
• Only 5% of the farmers of the district being engaged in bee-keeping

• Whereas The estimated income out of honey production and marketing to be

approximately two per cent of the total income of the district

• Koraput is a hilly region with 65% of the geographical area covered by forest and
so was suitable for honey production

• The income from the marketing and processing of honey was also used for the
development of bee-keeping and training to the beekeepers.
Viability of the Samiti
• Different products of the Samiti were marketed through six consumer stores,
retail outlets, and a distribution network

• The consumer stores were selling khadi products, honey, turmeric, and arrowroot

• 27 per cent of its revenues from honey

The Importance of honey for the Samiti

 Four different factors

• Financial support (KVIC and the UNDP)

• Ease of procurement

• Availability of processing facilities

• Marketing experience
Sales of Turmeric, Arrowroot, Honey, and
Khadi (in Thousand Rupees)
Marketing & Processing

1970s Manually process and sell honey locally

Organizations were involved in different areas of beekeeping and

1982 honey marketing activities
1. Orissa Khadi Board
2. Khadi and Village Industries Commission (KVIC)
3. District Industries Centre (DIC)
4. Integrated Tribal Development Agency (ITDA), Koraput
5. Sarvodaya Samiti – implementing agency

1990 Received ‘Agmark’ certification

1995 Opened new processing centre at Bhubaneshwar

Types of Honey
Apiary Honey
o Produced by the Indian bee
o Clean & transparent
o Free from foreign materials
Forest (rock bee) Honey
o Collected by crude methods from the
beehives
o Looks turbid
Procurement of Apiary Honey
Cost of Procurement of Apiary Honey

Area of Procurement Price paid by Cost (Rs. Per kg)

Koraput and adjacent Traders from Andhra 90 – 100

districts Pradesh

Sarvodaya Samiti 60

West Bengal, Sarvodaya Samiti 40

Chhattisgarh and parts
of Bihar
Procurement plans for Rock bee honey

Area Quantity to be procured per

annum

Similipal Eight tonne

Malkangiri, Umerkote and Two tonne

Nabarangpur

Phulbani Five tonne

Transportation cost

Area Cost (Rs. )

Calcutta, West Bengal 14000 + 8000 per truck for 10 tonne

Bihar 14000 + 8000 per truck for 10 tonne

Chhattisgarh 14000 + 8000 per truck for 10 tonne

Puri & Sakshigopal 2000 to 3000 for 3 – 4 tonne

Koraput to Bhubhaneshwar 8000 per truck per tonne
Packaging & Branding

‘Apiary’ written in a big

Glass bottle & no
font followed by a
special brand name
prominent ‘Honey’

The name and address

of the organization
was given in still
smaller size
Promotional Activities
• Participation in melas and fairs

• Gramashree Mela in Berhampur organized by the Council for Advancement of

People’s Action and Rural Technology (CAPART)

• Bali Jatra held at Cuttack

• District level melas, fairs, and exhibitions

 Kirana store

Farmer collecting Processing , packaging

and marketing Retail outlet
honey

KVIC distribution
network
Competitors
Strategic Issues
• It was unable to meet the demand of the market

• Lack of efficient processing plant

• Imposition of sales tax

• Taking a strategic decision whether to continue under the KVIC banner or not

• Proposed consortium of three parties

Alternatives
1. Sarvodaya Samiti being part of the Consortium

2. Sarvodaya Samiti not being part of the Consortium

3. Severing Linkage with KVIC

4. OMFED Proposal

5. Tie-up with both ORMAS and OMFED

1. Sarvodaya Samiti being part of the Consortium

• Responsibility of processing honey the honey procured by ORMAS

• There were two options for the Samiti:

- Take up the processing activity & withdraw from marketing completely

- Do processing for ORMAS while also processing and marketing its honey procured
independently
Option 1: Take up the processing activity & withdraw from marketing
completely

 Cost

• ORMAS would pay processing fee of Rs. 26 per litre to the Samiti

• Risk of killing its own brand

 Benefit

• Samiti could boost it position by leveraging its proven strength in processing and
packaging honey.
Option 2: Do processing for ORMAS while also processing and
marketing its honey procured independently

 Cost
• Minimum utilisation of capacity for Samiti

• Killing its fast moving brand

 Benefit
• Samiti could be a part of the consortium
- Taking up processing for ORMAS &
- Marketing of its own procured honey
2. Sarvodaya Samiti not being part of the Consortium

 Cost
• Setting up processing plant

• High investment will be needed

 Benefit
• Autonomy in all aspects

• Assured marketing growth

3. Severing Linkage with KVIC

 Cost
• Developing a national network like KVIC

• Impact on marketing of other existing products

 Benefit
• Able to retain its own brand

• Independent marketing entity

4. OMFED Proposal

 Cost
• Kill its own brand name

• Fully developed processing plant

 Benefit
• Better market access
5. Tie up with both ORMAS & OMFED

 Cost
• Kill its own brand

• It will affect the sales of other products of Samiti

 Benefit
• Market linkage

• Both ORMAS & OMFED are very known brands to the customers
Decision
• Not to take part in consortium (Selecting Alternative 2)

• Keep its relation with KVIC

- Maintain its brand name

- It will be able to achieve its objective

- Take advantage of greater market access of KVIC

- Access to the fund of UNDP

• It can also overcome the problem of pricing by periodic increase

Current Scenario
• Two khadi spinning centers and three weaving centers

• 300 artisans associated with the khadi program

• Beekeeping training center for farmers

• Honey Mission by KVIC

• SUSTAINABLE AGRICULTURE
Thank You