Journal of Rural and Industrial Development

Amit Kumar Dwivedi ¹

Affiliations
1 Entrepreneurship Development Institute of India, Gandhinagar, Gujarat, IN

Abstract

A Quality conscious Gur (Jaggery) Manufacturer Mr. Harivansh Bahgat, owner manager of Bhagirathi Gur Manufacturers (BGM), is very much worried about the costing of his four main products, manufactured at BGM. This is a family owned business which has sustained till the third generation of Mr. Harivansh. BHM has earned its name and reputation in the Jaggery manufacturing and allied products in Eastern Uttar-Pradesh and Western Bihar. Also, this group is recognized for its quality and timely delivery in the region. In recent times, the Eastern Uttar-Pradesh has become famous for Jaggery production, and so several Gur manufacturing units have been established. In the region more than 50 clusters are in working condition, and in turn a competitive scenario has emerged. Currently, BGM is producing four products Jaggery –Block, Jaggery-Powder, Jaggery Syrup and Jaggery-Candy. All these products have a common raw-material of Jaggery which is easily available in the north-eastern part of Uttar-Pradesh. BGM is using traditional method of production and costing the products. They keep direct material, expenses and labour to calculate direct cost of products and then add equal amount of indirect cost to each product. According to BGM per Kg. cost of products are Rs. 117.75, Rs. 113.37, Rs. 91.26 and Rs. 174.12 for Jaggery-Block, Jaggery-Powder, Jaggery- Syrup, and Jaggery Candy respectively. Although BGM produces all four products regularly, Jaggery-Block is the most popular product with a sound customer base. This year due to huge supply from other Gur Manufacturers in the local market the prices have gone down which is a matter of weighty concern for BGM management. BGM is producing Jaggery-Blocks at Rs. 117.75 and charge 15% profit approximates (Cost plus profit) which comes out around Rs. 141.00. Currently market price of Jaggery Block is varied from Rs. 120.00 to Rs. 125.00, which is not affordable by BGM, since they have a cost of Rs. 117.75 per Kg.

Keywords

Rural Industry, Gur Manufacturing Units, Activity Based Costing and Cost Management Systems

Full Text

     

Rahul Kumar Shukla ¹, Amit Kumar Dwivedi ²

Affiliations
1 Indian Institute of Management, Ahmedabad, Gujarat, IN
2 Entrepreneurship Development Institute of India, Ahmedabad, Gujarat, IN

Abstract

The case aims to highlight the intriguing fall of business of Purvanchal Rural Bank (PRB) working in the purvanchal region of Uttar Pradesh. Since the inception, the bank has been doing considerably well and has emerged as a landmark in the rural banking industry. But, with the intrusion of private and nationalised banks in rural areas, the Purvanchal Rural Bank (PRB) has started losing its market share. The top management does not share information with the lower level employees who have never been involved in the policy making. Moreover, the new financial plans have been introduced only at the recommendation of government agencies regardless of their viability and suitability for a particular region. Conversely, private sector banks and nationalised banks used product-based marketing. They make a clear distinction in launching products in rural, semi-urban and urban areas. Consequently, they have been operating successfully in these regions.

The cases put together primarily from secondary sources and aims to address financial issues such as financial operations, product strategies, financial communication, policy making and strategies forming etc. in regard to Purvanchal Rural Bank.

Keywords

Financial Plans, Policy Making, Product-Based Marketing, Indian Rural Banking and Nationalised Banks in India.

Full Text