Rural Business Incubators: Tool for Inclusive Growth

Wednesday, July 14, 2010

BIPIN and Ratan, in their twenties, manage a small business that sells food-items, rice, chapathi, vegetables, nan etc, between 10 am and 3 pm every day in Mayur Vihar, in New Delhi. They make a profit of approximately Rs 2500 (US $56) per day. They have no bank account. There is no registration with the municipality. Their business has no official and legal permission.

Though the food is cooked and served in un-hygienic condition, every time their roadside hotel has a waiting queue of at least 10 to 12 men, to collect the ordered food. They are doing good business and earning some money as profit as well. Potential for further growth, expansion and diversification of their venture is possible.

Out of the total sales proceeds, which come to an average Rs 4500 to 5000 per day, the profit comes to Rs. 2500 to 3000 per day, say Bipin and Ratan. Thus they make a monthly net revenue of approximately Rs 75,000 (US $1600) or more.

Their customers are street vendors in that area, workers, cycle rickshaw/auto rickshaw drivers and others who cannot afford to eat at a hotel or who may not get a very good welcome in a normal Delhi hotel. The price per each unit served is Rs. 15. Along with a glass (150 ml) of buttermilk (raita), the price goes up to Rs. 20.

These young businessmen do not come from a traditional business caste or community. They come from a remote village from the state of Bihar and their caste background could be termed as socially backward.

Source: The Herald of India (link opens in a new window)