Markets don’t come to mountains
Updated: Mar 8, 2022
Umang was established first as a cooperative and transformed into a Producer Company of mountain women. It has been able to build a brand and link farm gates to distant markets leading to generating sustainable livelihoods for its small holder farming members.
Almora and Ranikhet towns in Kumaon region of Uttarakhand are renowned for their scenic beauty. However, these sights hide the pain of rampant migration, increasing difficulties in sustaining livelihoods, and a dying culture that has deep knowledge of sustainability and cooperative economics ingrained into it. This has created an inward collapsing vortex wherein most economic interventions fail due to lack of scale resulting from severe outmigration, environmental degradation and climate emergencies.
The challenge of the mountains
Pan Himalayan Grassroots Development Foundation was formed in 1992 to work on restoration of ecology through a holistic intervention strategy and a river basin approach. With high degree of male outmigration, women were left behind with tiny land parcels, some animals and the constant struggle of poverty.
In the beginning, when Grassroots began working with the women, they neither possessed products nor skills to link to the mainstream economy. The initial activity selection was based on local economies and trade keeping with the tradition of the hills. Once the capital started rotating it was easier to move them to a habit of savings and this slowly transformed into a SHG network over a long duration of time. The low population density and terrain makes the formation of even small SHGs very difficult and costly.
Small steps that go a long way
Forming a collective was the only option available to women members, most of whom were managing their lives alone. Slowly they started forming friendships with each other and the camaraderie followed. This helped to scale up the SHGs to a federation in 1999. The unique problems of women members led to the formation of Mahila Umang Samiti as a cooperative in 2001. They learnt the skills to participate in local rural and semi-urban markets and took to activities such as knitting and handweaving through their SHG network and the Umang Cooperative. Constant experimentation with various activities and markets helped forming four verticals of handknits, Organic foods or HimKhadya, Fruit preserves, pickles and natural honey. Around this time, the laws of the land changed and allowed the women to free themselves from the regime of cooperatives, which restricted their trade due to various compliances. They promptly reconfigured as Mahila Umang Producers Company Limited, an FPC in 2009.
Creating an Ecosystem
As the institutions experimented, improvised and innovated, they realised that the collective was limited to trading for the needs of the local market. This was not enough to fulfil the needs of the members and it was essential to link the local markets to mainstream markets. This linking required members to learn new skills, experiments and activities. Thus evolved a new vertically integrated organizational structure, picking up trading skills, apart from all commercial activities of forming and stabilizing conventional supply chains such as packaging, loading, transportation, contracting leading to the adoption of a value chain approach. Farm gates were soon getting linked to urban households, leading to a jump in collective confidence and pride as farmers and entrepreneurs. Today Umang clocks sales of over Rs. 1.5 crores every year benefitting its near 1000 members through sales, activity linked payments for work and services rendered. Umang soon realised the importance of business to business sales and developed a bridge with agripreneurs with local traditional markets and mandis as a good backup to salvage sales when markets were unfavourable. They may not be directly linked with Umang but are integral parts of the network and ecosystem that Umang draws upon to make mainstream markets a reality for the hill women.
Not only has this worked for the organization but also for individual members. Bimla a member of Umang resonates that woman must not think that she is weak. Defining their lives and taking control of their work has been an empowering experience for Umang members.
Bimla became the Pradhan, she completed all the duties her role demanded, herself. She said:
“I did a lot of work as the Pradhan- managed the program that guaranteed labour, installed solar lights, planted trees. I did all the work myself, my husband did not help me. He told me I should complete the work I have taken up.”
Bimla also said that she was successful in winning the elected position of a Pradhan because of the support of other women in her group.
Innovating the business model and structuring the organization dynamically
Umang has followed a principle of maintaining a high ratio of earnings of members to total sales. This ratio has consistently been maintained at above 50%. This meant that the business model required to be innovative to ensure this was met. This was made possible by designing vertically integrated Anand Pattern of Collectives that ensured most of the members were involved in a position of responsibility. This enabled them to earn as they discharged organizational duties. This also enabled a massive on-the-job leadership and capacity building program that has touched almost half of the individuals in one way or the other. A single village can have a maximum of four activity groups and two Self Helf groups theoretically making it possible to have 6x2 =12 women in leadership positions at any given time. Most villages will have at least one SHG and one activity group creating minimum 4 leaders from the village.
Rotation of leadership is compulsory at all levels from the groups at sub village level to the Board of Governors of Umang. This ensures they all understand the challenges of leadership and have more alignment in the decision-making process. This format is also being used to attract the younger generation into the organization as they are also allowed to rise up the leadership ladder on a rotation basis.
Humble but determined achievements
Umang has continued to stabilise at a turnover of around 1.6 Crores per annum across the four verticals while continuing with various experiments and pilots to configure new activities to change and adapt to the new world order and changing needs of the markets. Umang as an FPC continues to work on the principle of maximization of member earning as a percentage of the total sales. They have shown resilience in achieving more than 80% of pre-covid level sales even in the covid times while maintaining their earnings to sales ratio.
The biggest challenges that Umang navigates today is to induct the next generation of members into the organization and therefore needs to give them a viable option of staying back in the hills. A common saying in the region is, “पहाड़ का पानी और पहाड़ी जवानी, पहाड़ के काम नहीं आती” (The water and youth from the hills never benefits the hills itself). Perhaps initiatives like Umang can change that by tying the sustenance of the members and the organization to each other. The earnings to sales ratio and a newfound confidence amongst the members is a perfect measure of the same.
Vaibhav Bhamoriya is a faculty of Economics at IIM Kashipur.
Anita Paul is the co-founder of Pan Himalayan Grassroots Development Foundation.