LIVELIHOOD MAPPING AND VALUE CHAIN ANALYSIS OF SELECTED

TOWNS OF URBAN BIHAR

BY
Aishwarya Sagar
Development Internship Segment
PRM 36

Submitted to
APMAS, Bihar
Faculty Guide: Prof. H. K. Mishra
July, 2016

Acknowledgement

There are certain events in our lives which take place as a result of the culmination of the
efforts, guidance and assistance of several people. This acknowledgement attempts to express
my deep sense of gratitude to all those people who helped me in my endeavor towards slum
sensitization and in the process, shaped my life.
I would like to express my heartfelt gratitude to my host organization, APMAS, for
facilitating my stay in Bihar and for the valuable inputs that they provided me throughout my
study. I would also like to thank Mr. Sunil Kumar Singh and all the other staff of APMAS,
Bihar for their kind assistance.
I am extremely grateful and indebted to IRMA and our field work Co-ordinator Prof. Vivek
Pandey for giving us this unique opportunity my faculty guide Prof. H. K. Mishra for guiding
me throughout my DIS.
I am indebted to all the member women of Gaya and Biharsharif CLF for giving their
precious time to this study and whose case studies are a part of this report. We are extremely
thankful for their co-operation and support throughout our study. All of them helped us
immensely with both their knowledge and energy. I went with an intention to understand the
working of SHG and its capacity building, but ended up being influenced and transformed.
Thank You,
Aishwarya Sagar

Executive Summary

Title

Livelihood Mapping and Value Chain Analysis of Selected

livelihood in Urban towns of Bihar

Organisation

Mahila Abhivruddhi Society

Reporting Office

Mr. Sunil Singh

Faculty Guide

Prof. H. K. Mishra

Participants name

Aishwarya Sagar

Background: Urban poverty is complex and multi-dimensional due to increasing inward

migration, unorganised labour, lack of access to basic services (housing, safe drinking water,
sanitation, health care, education), gender inequalities, poor urban governance, and lack of
employment opportunities in spite of growing secondary and territory sectors. Mahila
Abhivruddhi Society (formerly APMAS) and Sadhikaratha Foundation are jointly
implementing Support Programme for Urban Reforms (SPUR) for the Urban Development
and Housing Department (UD & HD), Government of Bihar. The project period is for three
years (May 2014 to April 2017). The broad contours of the SPUR intervention includes
empowering the poor and socially excluded community to access increased urban resources
and livelihood opportunities through community mobilization and participation. Currently,
SPUR is working in 45 towns of Bihar contributing to formation of 6000+ SHGs.
Objectives of the study: The objectives of the project were to: (i) to understand typical
livelihood portfolio of SHG women engaged in identified subsectors, (ii) undertake the
mapping of the various livelihood activities of the urban poor women/families and value
chain analysis for selected livelihoods in urban areas of Bihar keeping in view of the
following: 1) Role of value chains in promoting sustainable and inclusive development for
urban poor. 2) Factors necessary for value chains to thrive, such as finance, technology and
producer-buyer linkages, etc. 3) Potential for Public-Private Partnerships and multistakeholder approaches. (iii) propose an alternative institutional mechanism which can
support at SHG women

ii

Scope of the study: The scope of the study was limited to two SPUR districts of Bihar,
namely Gaya and Biharsharif, which have recorded more active SHG member than any other
districts of Bihar.
Research methodology: For the selection of towns for fieldwork, convenience sampling
technique was applied in which on the basis of some emerging activities and the activity
capacity building. Data collection was mainly done via FGDs and key-informant interviews.
Akshara framework was referred for livelihood mapping and identifying prominent
livelihood activities. Following the Porters model for value chain all the primary activities
and support activities were framed taking into account the challenges and constraints
encountering these activities.
Major findings: (i) SHG women in Gaya mostly were engaged in Agarbatti Rolling while
Subsistence Farming in Bihar Shariff. (ii) Livelihood mapping showed other prevailing
activities such Bidi making, Bamboo work and Domestic help. Other potential livelihood
activities carried out in the region was brought under the scope of study. (iii) Observing the
six capitals (assets) possessed by ALFs in two towns and factor analysis done with the help of
key informants, finally, Phenyl/Detergent making in Gaya and Mushroom cultivation in
Biharsharif were selected for further value chain analysis. Also, the vital stakeholders and
Institutions like ATMA and RSETI are linked at each stage of the value chain.
Conclusion: The major benefits of adding value include increased sales, prolonged shelf-life
and varieties of value added products. The common challenges they faced include lack of
access to large market share due to low production and value addition.
Recommendation: That further studies need to be done on the benefits of each value
addition from production point of view. This will show whether value addition can reduce the
number of years used to pay back the initial cost of undertaking mushroom enterprise as
whole.

iii

Abbreviation

ALF

Area Level Federation

APMAS

Andhra Pradesh Mahila Abhivruddhi Society

ATMA

Agricultural Training and Management Agency

BPL

Below Poverty Line

CLF

City Level Federation

DFID

Department for International Development

FGD

Focus Group Discussion

IDI

In-depth Interview

IRMA

Institute of Rural Management, Anand

NTFP

Non-Timber Forest Products

RF

Revolving Fund

SHG

Self-Help Group

SPUR

Support Programme for Urban Reforms

SVS

Samuhik Vikas Samiti

iv

Table of Contents
Acknowledgement ................................................................................................................................... i
Executive Summary ................................................................................................................................ ii
Abbreviation .......................................................................................................................................... iv
1.

Introduction..................................................................................................................................... 1

1.1.

Background ............................................................................................................................. 1

1.2.

Project Background................................................................................................................. 2

2.

Objective and Methodology............................................................................................................ 3

2.1.

Objective .................................................................................................................................3

2.2.

Methodology........................................................................................................................... 3

3.

2.2.1.

Sampling technique.........................................................................................................3

2.2.2.

Sources of Data ............................................................................................................... 3

2.2.3.

Analysis Tools ................................................................................................................ 5

Livelihood mapping and Value chain analysis of Gaya..................................................................7

3.1.

Demographic profile: Gaya ..................................................................................................... 7

3.2.

APMAS in Gaya........................................................................................................................ 7
Caselet 1: The Change Maker

................................................................................................................. 7 3.3.

Major Livelihood

Activities...................................................................................................... 8 3.4.

Ranking of the

Activities .........................................................................................................9 3.5.

Feasibility

test .......................................................................................................................10 3.5.1.

Condition

Analysis........................................................................................................10 3.5.2.

Livelihood

Capital Index ..............................................................................................11

4.

Value Chain Analysis of Phenyl/Detergent Making in Gaya .......................................................12

4.1.

Primary Activities ..................................................................................................................12

4.1.1.

Inbound Logistics..........................................................................................................12

4.1.2.

Operations .....................................................................................................................13

4.1.3.

Marketing......................................................................................................................14

4.1.4.

Outbound Logistics .......................................................................................................16

4.2.

Support Activities..................................................................................................................18

Finance:.........................................................................................................................................18
Procurement: .................................................................................................................................18
Recruitment:..................................................................................................................................19
General Administration.................................................................................................................19
4.3.

Margin distribution across chain ..........................................................................................19

v

4.4.
5.

6.

Livelihood Intervention in Gaya CLF .....................................................................................20

Livelihood mapping and Value chain analysis of selected livelihood of Biharsharif...................22

5.1.

Demographical profile of Biharsharif:...................................................................................22

5.2.

APMAS in Biharsharif ............................................................................................................22

5.3.

Major livelihood activities.....................................................................................................22

5.4.

Ranking of Activities..............................................................................................................23

5.5.

Mushroom Cultivation in Nalanda District ...........................................................................24

5.6.

Feasibility test .......................................................................................................................24

Value Chain Analysis of Mushroom Cultivation in Biharsharif...................................................27

6.1.

Global scenario .....................................................................................................................27

6.2.

Indian scenario......................................................................................................................27

6.3.

Value Chain Analysis of Mushroom ......................................................................................30

6.3.1.

Primary Activities .........................................................................................................30

6.4.

Cost-benefit of a sample value-added product of mushroom .............................................37

6.5.

Conclusion.............................................................................................................................39

6.6.

Livelihood Intervention in Biharsharif CLF............................................................................39

6.7.

Recommendation..................................................................................................................40

Appendix................................................................................................................................................ ix
Appendix 1: Complete Cost estimation of Detergent manufacturing ............................................... ix
Appendix 2: Complete Cost estimation of Phenyl manufacturing ................................................... xii
Appendix 3: Complete Cost estimation of Mushroom Cultivation...................................................xiv
Annexures ............................................................................................................................................xvii
Annexure 1: Questionnaire for FGDs in Slums.................................................................................xvii
Annexure 2: Questionnaire for Sub-sector Analysis and Value chain Analysis .................................xx
Annexure 3: Questionnaire for In-depth Interview .........................................................................xxii
References...........................................................................................................................................xxvi

vi

List of Tables
Table
1:Major
Livelihood
Activities........................................................................................................8
Table
2:
Ranking
Matrix
for
Gaya............................................................................................................ 9
Table
3:
Margin
distribution for detergent...........................................................................................19 Table 4: Margin
distribution for white phenyl......................................................................................20 Table5: FourArrow
outcome
in
Gaya
CLF ...........................................................................................21
Table6:Major
Livelihood
Activities
in
Biharsharif
...............................................................................23 Table7:Rankingof activities in Biharsharif CLF
...................................................................................24 Table 8: Seasonality of Mushroom cultivation
in India ........................................................................29 Table9:Four-Arrow Outcome in Biharsharif
CLF .................................................................................39

vii

List of Figures
Figure 1: 3-tier Federation Structure implemented by APMAS.............................................................. 2
Figure 2: Source of Data.......................................................................................................................... 4
Figure 3: Steps in the Intervention ......................................................................................................... 6
Figure 4: Factors influencing these potential livelihood activities .......................................................10
Figure5:
Livelihood
Capital
Index
Gaya................................................................................................11 Figure6: Distribution Channel of
Shakti Mahila Production Unit ........................................................17 Figure 7: A brief glance of
primary activities ........................................................................................18 Figure8: livelihoods
framework implemented by APMAS ...................................................................20 Figure 9: Factors
influencing Fungiculture............................................................................................25 Figure 10:
Livelihood Capital Index Biharsharif...............................................................................26 Figure 11:
Types of Mushroom grown in India .....................................................................................27 Figure
12: percentage use of crop residues in India.............................................................................28 Figure
13: Construction of mushroom house .......................................................................................32 Figure
14: Process of Mushroom cultivation ........................................................................................33 Figure
15: Processing of Mushroom .....................................................................................................34 Figure
16: Distribution Channel for Mushroom....................................................................................37

viii

1. Introduction
1.1. Background
Urban poverty is complex and multi-dimensional due to increasing inward migration,
unorganised labour, lack of access to basic services (housing, safe drinking water, sanitation,
health care, education), gender inequalities, poor urban governance, and lack of employment
opportunities in spite of growing secondary and territory sectors. While urban areas provide
opportunities to many, such as job prospects, those with low skill level are more likely to be
left behind and find themselves struggling. Many of these urban poverty problems are rooted
in rapid migration and lack of planning for urban growth and management, resource and
capacity constraints, inadequate policies, and challenges in project implementation such as
structuring of projects or quality concerns.
It is estimated that 70 per cent of the worlds population will live in cities by 2050. In India,
urbanisation is projected to reach 50 percent by 2030, an increase of over 200 million in just
20 years. At present, urban poverty across India is around 13.7 percent, and about 52.8
million people live in urban areas on incomes that are below the poverty line.
In working to address these problems, Support Programme for Urban Reforms (SPUR) was
launched by Department for International Development (DFID) of UK in association with
Government of Bihar. DFID is seeking to better understand the challenges and opportunities
of urban livelihoods. Therefore it commissioned APMAS, a national-level technical and
managerial support institution founded in 2001 with a vision of a sustainable self-help
movement in India, to design a livelihood mapping and assessment toolkit for
implementation and use by MEPMA.

2. Objective and Methodology

2.1. Objective
We are required to undertake the mapping of the various livelihood activities of the urban
poor women/families and value chain analysis for selected livelihoods in urban areas of Bihar
keeping in view of the following role of value chains in promoting sustainable and inclusive
development for urban poor, factors necessary for value chains to thrive, such as finance and
investment, ICTs, technology and producer-buyer linkages, E trading of commodities through
various platforms and finding Potential for Public-Private Partnerships and multi-stakeholder
approaches

2.2. Methodology
2.2.1. Sampling technique
For the selection of towns for fieldwork, convenience sampling technique has been applied in
which on the basis of some emerging activities, distance from headquarter and the activity
capacity building, I have shortlisted the towns. Then for the survey, the same convenience
sampling technique has been used. Most of my interactions were with the elected
representatives of SHGs, ALFs and CLFs.

2.2.2. Sources of Data

We utilized both the primary and secondary sources of data to get both macro and micro level
information about the village, details of which are given below:

Figure 2: Source of Data

FGDs

Primary data

Case Studies

Survey

Sources of data

Govt. data(Nagar
Nigam &NULM)
secondary data

Non-govt. data
(SPUR and
APMAS)

Source: Action Plan

A. Primary Sources
i. Survey: A survey for about 30 households was carried out using convenience sampling.
The survey questionnaire consisted of both open ended and closed ended questions. It can be
found in Annexure 1 of this report. The purpose of the survey was to get an overall scenario
of the product consumption pattern, market situation, consumer behavior and deciding the
target segment.
ii. Case Studies: Three case studies have been prepared of some SHG member women who
have struggled to achieve their ambition and have provided me with some vital information.
iii. Focus Group Discussion: FGDs were a tool which compelled SHG women to say a lot
which anyways they would not like to say. They demonstrate impulsiveness when they get
into a debate. Also, I get to both the convergence and divergence of views on major topics.
For me the regular meeting of ALFs helped a lot as member women of that ALF used to
gather for their monthly deposit and query sessions.
B. Secondary Sources
i. Governmental Sources: Government sources provided us with readymade authentic data
which helped us much more. Nagar Nigam Office, RSETIs and NULM records were referred
for this purpose. Census 2011 data was considered for sampling.

ii. Non-governmental sources: I utilized the records and informative database provided by
SPUR office and APMAS office and most importantly Google for supplementing my report.

2.2.3.Analysis Tools
Framework
The livelihoods framework used in this mapping and analysis is based on the Akshara
Livelihoods Framework developed by the Akshara Network, a non-for-profit development
support organization in India. It has, however, been adapted to fit an urban setting. The
framework includes six capitals that bring change to four contexts, and subsequently results
in changes for four arrows.
The six capitals are:
Natural: in urban settings, most often seen as risks, such as precipitation (rain, fog, hail),
floods, air quality, etc. (in rural settings, would include access to land, water, animals, wild
products and biodiversity, etc.)
Physical: all that is man-made, such as equipment, vehicles, etc. as well as infrastructure,
such as roads, electricity, water supply and sewage, schools, libraries, etc.;
Social: the support a family gets from society, kin networks, group membership and
community; socio-political voice and influence; could be encouragement or cautions, feeling
of binding with a network, enforcement of social norms (such as repayment of loans), etc.;
Human: the education, skills, knowledge, attitude, aptitude, strength, active labour,
experience of individuals, etc. of the household as well as of the community, which can be
drawn upon; as well as access to trainings, facilitation support, etc.
Financial: savings (such as cash or bank deposits), liquid assets (such as livestock or
jewellery), mechanisms of insurance support, credit, cash flows not from current work (e.g.
pensions or interest on savings), etc.
Spiritual: the spirit to survive, improve upon present conditions, fight back against shocks,
aspirations, etc.
5

A sub-sector is a network of enterprises that supply raw material, transform them, and
distributes the finished goods to a particular consumer market.2 Therefore, any group of
commodities which shares a common procurement, processing, and distribution channel
(retailers, exports) may be considered a sub-sector.
A value chain is the full range of activities which are required to bring a product or service
from conception, through the different phases of production (involving a combination of
physical transformation and the input of various producer services), delivery to final
customers, and final disposal after use.
Figure 3: Steps in the Intervention
Understanding
various
livelihood
activities

Ranking these
activities based
on various
parameters

Doing
feasibility test

Drawing Value
chain

Planning an
intervention
plan

Limitations of this tool

While this toolkit has adopted a Sub-Sector and Value-Chain Analysis approach, other
approaches to analysing livelihoods exist, and may reveal a different set of perspectives and
interventions for improving livelihoods. There are further a multitude of livelihood
frameworks. The toolkit aims to select a set number of livelihoods for analysis, therefore not
covering all the potential livelihood activities within the city. Further, the sub-sector and
value-chain analysis approach works best when applied to the manufacturing and trade
sector, rather than service although efforts have been made to also effectively analyse
service activities using the steps in this toolkit. Other approaches to analysing livelihoods
include an enterprise approach, markets-driven approach, systems approach, communitydriven approach, private-sector driven approach, and employment or self-employment
approach.

3. Livelihood mapping and Value chain analysis of Gaya

3.1. Demographic profile: Gaya
In 2011, Gaya had population of 474,093. Out of the total Gaya population for 2011 census,
13.24 percent lives in urban regions of district. Total no. of Slums in Gaya city is 6,289 in
which population of 40,915 resides. This is around 8.63% of total population of Gaya city.

3.2. APMAS in Gaya

Till now, APMAS, Bihar has been very active in capacity building and forming groups in the
slums of Gaya. APMAS representative Mr. Ramawatar Shashtri works in collaboration with
SPUR team and Nagar Nigam Executive Officers. There are 19 area level federations (ALFs)
under Gaya City Level Federation (CLF) which is known by the name Shakti Mahila Vikas
Swalambi Sahkari Samiti. Around 191 SHGs are formed till date and still counting which
has supported nearly 3000+ households dwelling in slums.
Caselet 1: The Change Maker
Mrs. Shashikala Sinha from Ghaniya Bagicha slum Gaya district got married when she was very young. She
could study only up to 10th class, but had big dreams. Her husband was a farmer who used to farm on
Mukkarrar basis. After her marriage, she used to give tuitions to small children in order to contribute some in
her household income and manage their financial crisis. She knew the importance of education in the
development of ones character, so she persuaded husband to send her children to school instead of engaging
them in the fields. The situation worsened after his sudden demise, after which she was bread bearer for her
family consisting of two sons and a daughter. A Ray of Hope and answer to all her questions was found
immediately after her joining SHG. She realized that she is not alone. There are other women in the group to help
her. She did every task endowed upon her with complete devotion and sincerity. After 3 months of her joining,
she was made the facilitator of that slum on the daily wage of 30. After that there was no turning back for her.
Within a span of 5 months, she formed 32 SHGs within her slum. Till then, Support program for Urban Reforms
(SPUR) was launched in Bihar which brought all the activities of SHGs under its scrutiny. Under the guidance of
SPUR team, Shashikala initiated the formation of Area level federation (ALF) for her slum, which was further
registered. . In 2014, she joined Samuhik Vikas Samiti (SVS), under which she made 159 toilets in 5 slums.
Recognizing her work of excellence, SPUR awarded her with best community facilitator prize. Till now, she has
helped 12 SHGs in sanctioning their CCL and 25 SHGs in creating their bank account. We hope she continue to
do work like always and inspire others
7

3.3. Major Livelihood Activities

Based on the APMAS framework toolkit, I have listed out the major livelihood activities in
which the member women are engaged. Most of the women are engaged in Agarbatti rolling,
while few earn as seasonal field labourers and beautician practice. Some of the women
dwelling in Bodh Gaya are engaged in Bamboo crafts in which they prepare baskets and
Kalsup, widely used in Chatt puja during the Hindu calendar month of Kartik.
Table 1: Major Livelihood Activities

Source: FGD

3.3.1. Bottlenecks in Agarbatti making

It is a highly unorganized sector as more than 80% production comes from these slum
households. They are only responsible to provide temporary labour to these industries. There
is no fix numbers of days for those working in this industry nor there do any provision for
standard wage for these people. Non-involvement of Agarbatti rollers in high value addition
activities, is also a factor for which these women want another source of livelihood. Nonavailability of raw material in local markets discourages these women to start an Agarbatti
venture of their own. Also, there is a lack of support industries (Scenting & Packaging) which
does not add any value hence is less profitable. Involvement of local women in only

manufacturing of raw Agarbatti with a meagre pay of Rs.15/kg, has brought more
vulnerability to their livelihood sustenance.

3.4. Ranking of the Activities

APMAS representative had already initiated to find various coping mechanisms to eradicate
the vulnerability of the women who are least compensated for their labour in Agarbatti rolling
and field labourers. The ranking matrix a part of AKSHARA livelihood framework ranks
various identified activities based on those parameters vital for sustaining it for long. First of
all, rating is done on the scale of 1 to 5, and then ranking is done based on the decreasing
order of score. As a result, some activities which had potential market and least set-up cost
were kept into consideration, so that it could be attached to any group of member women, in
minimum possible investment. These identified potential activities are Phenyl Making and
Detergent Making.

Table 2: Ranking Matrix for Gaya

Activities>
Factors\/

Agarbatti
Rolling

Bamboo
Work

beautician

Bindi
Making

Field
Labourer

Phenyl
Making

Detergent
Making

Suitable for
health/lifestyle

Stable income in
entire year

Raw material
market available

Potential to
employ many
individual

Least Influence of
middlemen in
sector

TOTAL

12

12

13

14

Source: FGD

3.5. Feasibility test

After selecting the sustainable livelihood, further analysis of their feasibility is done with the
help key-informants. In this test, 3 key-informants were AMPAS project officer in Gaya,
president of Gaya CLF and head-trainer in RSETI Gaya. They were asked to rate certain
factors (refer to annexure for the interview questionnaire structure) on the scale of 1 to 5.
Then, the average score of three informants were considered to judge the condition.

3.5.1. Condition Analysis

Figure 4: Factors influencing these potential livelihood activities

Factor
Condition

Demand
Condition

Easy access to raw

material &
infrastructure

Large amount of
local demand

Easy availability
of skilled
workforce

Industrial
Condition
Presence of many
competitors for
the same product
in the market

Season has no
influence on
demand

Difficult in
micro-financing

scope for growth

in local market

Climatic condition
suitable for this
activity

Mostly sales to
through member
based marketing

Some barriers
available in
setting up of the
production
system

Financial
Condition
informal
promotional
agencies present
Availability of
training from
RSETIS at free of
cost

Favourable
government
policies
Bank will possibly
provide the loan

Source: Key Informant Interview (refer to interview questionnaire format in annexure 3)

There are various factors influencing both the activities i.e. Phenyl Making and Detergent
Making. All those point that are blackened are opposing factors for this livelihood, while
those in white fonts are the favouring factors for these livelihoods. Gradually, there are more
favouring factors as there is availability of potential market and favouring government
policies.

10

3.5.2. Livelihood Capital Table

Figure 5: Livelihood Capital Table Gaya

Natural Capital

Less sensitive to weather condition, ingredients are

chemicals

Physical Capital

Infrastructure like road, water supply, etc. are available

Well connected to market by rail and road

Social Capital

Supporting government schemes that are being utilised

Activity well respected in the community

Human Capital

Not very specific skills required for this activity

Less-labour intensive activity

Financial
Capital

Periodic bulk purchase of inputs required

Start-up costs not very high

Spiritual Capital

Aspiration in members to learn new technology, skills,

etc.
There are also good risk mitigation tactics

Source: Key Informant Interview and FGDs

This information is gathered with the help of key informants. These capitals are the assets
that are necessary for the setting up of these activities into main line. Most of the assets are
possessed by the member women living in Ghaniya Bagicha slum of Gaya to start phenyl
making and detergent making. Finally, above factors gave us the green signal to go with
phenyl/detergent making as the activities in nearby slums.

11

4. Value Chain Analysis of Phenyl/Detergent Making in

Gaya
4.1. Primary Activities
These activities contribute to the physical creation of phenyl/detergent, its sale and transfer to
the buyer, and its service after the sale. They are categorised into five main sections i.e.
inbound logistics, operations, outbound logistics, marketing and sales, and service.

4.1.1. Inbound Logistics

Receiving raw material: All the raw material required for manufacturing of phenyl and
detergent are available in local market of Gaya and Patna but at a varied price. When they
need to buy in bulk, they have to procure it from Patna in order to reduce cost. The Nagar
Nigam Community hall in Ghaniya Bagicha Slum has been handed over to Sheela Devi,
president of Gaya City Level Federation (CLF) which will be extensively used as the
production centre for Ghaniya Bagicha ALF. Gradually as the need for more production
arises more, community halls will be acquired in other member slums of Gaya. A section of
this community hall will be used for storing the raw materials procured.
Receiving & Installation of Machines: All the tools and machineries are available at Station
Road, Patna as well as in markets of Jamshedpur and Kolkata. For the convenience of
servicing of machineries, it will be better to get them from Patna which is at a distance of
around 100 kms via road. The installation and demonstration of all the machineries will be
done will be by the company people on site and only installation cost will have to bourn by
the buyer.
Training: RSETIs are Rural Self Employment Training Institutes, an initiative of Ministry of
Rural Development (MoRD) to have dedicated infrastructure in each district of the country to
impart training and skill upgradation of rural as well as urban youth geared towards
entrepreneurship development. RSETIs are managed by banks with active co-operation from
the Government of India and State Governments. Any unemployed youth in the age group of
18-45 years, irrespective of gender and economic status, having aptitude to take up selfemployment or wage employment and having some basic knowledge in the related field can
undergo training which is totally free.

12

Currently, the led-bank in Gaya district is Punjab National Bank (PNB) which is in
collaboration with MoRD, managing the RSETI. This training centre situated in Ghaniya
Bagicha provides 69 different types of training out of which some popular ones are tailoring,
Beautician, Bindi making, Detergent making and Phenyl making. With the help of APMAS
representative, 30 women from that region have been certified with the training of phenyl
making, detergent making and candle making. RSETIs have also vowed to make follow ups
of their participants and further upgradation of skills, if they are really taking their skills to
entrepreneurship.
Licensing and registration: In chemical manufacturing business, first of all, one will need to
register the producers group as a company/cooperative with ROC. For this purpose, they will
need to obtain Trade License and Vat Registration. Consent to Establish and Consent to
Operate both are required from Pollution Control Board. Liquid phenyl is reported as a
Drug under the Drug Act. A prior permission and License from Drug Control Authority is
necessary for its manufacture.

4.1.2. Operations
Processing:
Detergent: There are two ways of manufacturing dry laundry detergent that commonly used
today. First is the blender process favoured by smaller companies. The RSETI (Gaya) mostly
provides training for this method as it is best suitable for individual level cottage industries.
The ingredients are mixed in large vats before being packaged. The second commonly used
method of production is called the agglomeration process. Unlike the blender process, it is
continuous, which makes it the choice of large detergent manufacturers. The agglomeration
process can produce between 6,800 and 22,700 kgs of detergent per hour. All the ingredients
are loaded into one of two machines: a tumbling blender or a ribbon blender. The tumbling
blender is turned and shaken from outside by a machine, while the ribbon blender is a
cylinder fitted with blades to scrape and mix the ingredients. After the ingredients inside the
blender have been mixed, a doorway at the bottom of the bowl is opened. The member
women of Gaya CLF have been provided the training for the agglomeration process, as this is
a large group and planned for large-scale manufacturing.

13

Suggested value addition: As the consumers are declining more towards easy washing, the
CLF can come up with another product i.e., Liquid Detergent. If the detergent is to be liquid
rather than powder, it is simply mixed back inafter all ingredients are blendedwith a
solution consisting of water and various chemicals known as solubilizers.
Phenyl: Unlike detergent, hardly any machine is required for phenyl manufacturing. Since
Emulsifier is available in markets in the form of hard lumps, hence, first of all, it is heated in
a pan and when it completely melts, then the solution of Pine oil mixed in liquid Rogene.
With the help of either mixer, these solutions are thoroughly mixed. When these materials are
properly mixed, then KMX is added to it in a little proportion and water is added in such a
quantity so that the whole blend is properly mixed. Well mixed and stirred solution is then
left to cool.
Suggested Value addition: Generally, white phenyl has the pungent smell which causes
irritation to people nearby. To avoid it, scented phenyl in various flavours is the new trending
demand in market getting popular in hotels and restaurants.

Bottling/Packaging:
White Phenyl will be bottled in half-litre, one-litre and five-litre plastic bottles and a
measuring cap. On the other hand, detergents will be packed in plastic packets with the help
of packing machine. The liquid detergent can be bottled in plastic bottles just as it was done
for phenyl.

4.1.3.Marketing
Need Identification
Detergent powder as a substitute for laundry soap is becoming increasingly popular with
public since its introduction in the market. In present days many people does not want to
wash their clothes with laundry soap due to not easiness of washing process. From the survey
it is found that out of 30 respondents 75% respondents are female according to taking
decision observing the price (cheaper) of detergent. The majority respondents are female
members of SHGs associated with SPUR and APMAS. Other includes the moderate hotels
situated near Gaya Railway Station. The majority of respondents are female. So the
advertisement of detergent powder should take such a way that it attracts female persons.

14

Analysing competition
Ghari is the market leader of detergent powder industries in lower class of Central Eastern
India. The majority of respondents have chosen detergent powder for attractive product
features, brand image and package. Based on Promotional activities Wheel power white
Brand is the best. The majority respondents think that Ghari is the best for detergent powder
based on cash availability in the stores

Consumer Behaviour
The majority respondents are using detergent powder of Ghari and Wheel (Unilever). It is
found that out of 60 users, 15% respondents choose detergent powder for product features
(cleaning ability, packaging etc.), 50% choose for price, 20%choose for recommendations,
10% choose for availability and 5% choose for other reasons. The majority respondents think
that Unilever (Wheel) Ltd provides best product features to the detergent powder holders.
Thats why the customers are fully satisfied for the product features on detergent powder of
Unilever (Wheel) Ltd. The majority respondents think that Surf Excel Detergent Brand is the
best for based on price and packaging size of detergent powder
The majority respondents prefer Television for the advertising of detergent powder because
add to television influenced more female consumers.

Market segment
For detergent, our major segment our all 4000 households that are members 191 SHGs of
Gaya CLF, other lower class slum dwellers with income below 1 lakh/year. For Phenyl, we
have the same member segment and medical college (including the procurement for 23 CHCs
and PHCs in Gaya district). Finally, we have decided to target all 4000 households that are
members 191 SHGs of Gaya CLF for detergent and Medical College (CHCs and PHCs) for
Phenyl for the time being. Our potential future segment for detergent will be the lower class
people and for phenyl will be hotels, restaurants and public offices.

15

Demand estimate
Detergent: With the help of small survey, we have concluded that at least 2 kgs detergent is
the monthly consumption of each household in slums on an average. So, the target segment
demand for detergent is around 4000*2 kgs= 8000kgs. Supposedly, in initial phase, we are
able to penetrate this market and make 15% sale of target segment demand.
Then, Actual Demand will be:
Demand=2 kg*4000*0.15= 1200 kgs/month
Phenyl: we have plans to link it with a local brand that is suppling phenyl in government
Medical College, which is also responsible for all kind of procurement for CHCs and PHCs
in the villages of Gaya district. They have an average monthly demand of 1500 ltrs.

4.1.4.Outbound Logistics
Quality Control
Detergent: Manufacturers constantly monitor the quality of their detergents, and they utilize
the same testing methods to assess the effectiveness of new products. In one method, light is
shined onto a piece of fabric that has been soiled and then washed in the test detergent. The
amount of light reflected, compared to the amount reflected by a sample of the original
fabric, is a measure of cleanliness. A reflection rate of 98 percent is considered quite well and
indicates that the detergent has cleaned properly.
Phenyl: This method involves laboratory burning of a small amount of this chemical
compound. The weight of the ashes along with the weight of the gaseous results of the
burning, reveal how much of the impurities remained. A result that is much higher than a
clean test sample indicates that a significant amount of dirt was present in sample. Naturally,
the goal is to come as close to the weight of a clean control sample as possible.

Distribution:
A distribution channel in marketing refers to the path or route through which goods and
services travel to get from the place of production or manufacture to the final users. It has at
its center transportation and logistical considerations. As our initial target segment is the
women members of Gaya CLF. So, a distribution channel needs to be spread across the each
slum. There will be a super distributor in Dhaniya Bagicha Production centre itself. The
products will be distributed from there
16

For Business-to-business (B2B) distribution Products like phenyl will be distributed to

hotels, restaurants, private schools and private hospitals. This will be done by indirect
distribution which will involve procurement department of the organisation and other
middlemen who will gather link and contacts for sell generation.
For Business-to-customer (B2C) distribution occurs between the producer and the final
user. This will involve direct distribution to con sumers via the SHG and ALF meeting
centres. Each slum will have a distributor/retailer in its ALF centre from where direct selling
to customers can be done. Generally, the direct selling to the women members of Shakti
Mahila Vikas Swalambi Sahkari Samiti Ltd. (Gaya CLF) will be done during the monthly
meeting of ALF and CLF. Rest of the stocks will be kept in the ALF meeting centre and will
be managed by their respective president and vice-president.
Figure 6: Distribution Channel of Shakti Mahila Production Unit

Super
Distributor

Shakti Mahila
production Centre

B-2-B
Distribution

19 Area level
Federations
(ALFs)

Consumers

Private schools
and Nursing
homes

Source: Key Informant Interviews

17

Hotels and
restaurants

B-2-C
Distribution

Direct CLF
members

Transportation:
All the transportation activities will be done indigenously made motor-cart called
Jhajhariya that runs through-out the rural and semi-urban Bihar. Two jhajhariyas will be
permanently hired by the production centre, while the temporary jhajhariyas will hired in
accordance to the demand in the market. This will also generate employee for the husbands of
member women of Ghaniya Bagicha ALF.
Figure 7: A brief glance of primary activities

Inbound
Logistics

Raw material procurement from Patna city

Training: RSETI, Gaya provides free
training

Operations

Manufacturing and further value addition like scenting

Packaging/bottling in required size-packs

Marketing

Target segment: Phenyl- Medical college(+CHCs),Detergent- SHG members

Demand estimation: 1300 kgs of Detergent and 1000 ltrs of Phenyl
Strategy: B2B- through mediator, B2C- member based marketing

Outbound
Logistics

Setting of distribution channel across the target population

Efficient transportation from production centre to distributors

4.2. Support Activities

Finance:
All the financing for this activity will be done by CCL loan provided to a stable ALF.
Another source of finance will be Zila Udyog Kendra, Gaya which will provide a subsides
loan of 3,00,000 at 35% subsidy.

Procurement:

18

All the machineries will be procured from Jamshedpur which is 259 kms away from Gaya.
Raw materials required in the reoccurring procedure can be easily procured and transported
from Machadhatta, Patna City to Gaya via railway or roadway.

Recruitment:
All those 30 SHG member women of Dhaniya Bhagicha will initially take the charge of
running this production unit. Sheela Devi, president of Gaya CLF will be regulating the
activities under the supervision of RSETI, Gaya. After the probable success of this pilot
project, training will be provided in other parts of Gaya, and new production units will come
up.

General Administration:
Typically supports the entire value chain and not individual activities while promoting
effective planning systems, excellent relationships with diverse stakeholder groups and
effective information technology to integrate value-creating activities.

4.3. Proposed margin distribution across chain

After the value chain analysis of the selected livelihood activities, with the help of appendix 1
the proposed margin distribution and women involved in each activity is shown in the table
below:

Table 3: Margin distribution for detergent

Producers margin

Distributors Margin

Retailers Margin

15 women will be engaged in

production centre.
Production cost = 34.5/kg
Selling price
=40.0/kg
Producers margin= 5.5/kg

8 ALF representative in
distribution
Selling price
=45/kg
Distributors margin =5/kg

16 SHG members in
retailing
Selling Price
=50/kg
Retailers margin =5/kg

19

Table 4: Margin distribution for white phenyl

Producers Margin

Marketing agencys margin

15 women will be engaged in production

centre
Production cost = 14.5/kg
Selling price
=25.0/kg Producers
margin=10.5/kg

A marketing agency will be hired for

marketing
Selling price
=40/kg Agencys margin
=15/kg

4.4. Livelihood Intervention in Gaya CLF

Figure 8: livelihoods framework implemented by APMAS

This framework has been adapted to fit an urban setting. The framework includes six capitals
that bring change to four contexts, and subsequently results in changes for four arrows. This
toolkit has collected information on livelihoods and guided the user to analyse and explore
possible spaces for interventions. The highest priority ranked livelihoods, validated in the
community, is to be taken forward and developed into a detailed proposal or action plan.

20

Table 5: Four-Arrow outcome in Gaya CLF

Before Intervention

After Intervention

Income: irregular income, unfair compensation for

high-labour intensive work

SHG women will be able to earn average income

of 100-110/day in whole value chain

Expenditure: Individual activities increases raw

material procurement cost.

Group activity will decrease cost significantly with

bulk procurement & machineries

Employment: extreme vulnerability in finding

suitable livelihood activity

This activity will engage 30 women in production,

30 in distribution

Risk: no guarantee for work, seasonal fieldlabourers are workless rest of the year

This activity will provide work for throughout the

year

21

5. Livelihood mapping and Value chain analysis of

selected livelihood of Biharsharif
5.1. Demographical profile of Biharsharif:
Biharsharif city is governed by Municipal Corporation and is situated in Bihar. As per
provisional reports of Census India, population of Biharsharif in 2011 is 297,268; of which
male and female are 155,216 and 142,052 respectively. Total no. of Slums in Biharsharif city
numbers 3,259 in which population of 21,281 resides. This is around 7.16% of total
population of Biharsharif city.

5.2. APMAS in Biharsharif

Out of all SPUR towns in Bihar, Biharsharif has shown significant progress in recent days.
Santoshi Mahila Vikas Swalambi Sahkari Samiti Ltd. (Biharsharif CLF) is monitored by
SPUR officers, APMAS representative Mr. Dhananjay K.Singh and NULM officers. There
are 12 ALFs, out of which 4 ALFs are registered.

5.3. Major livelihood activities

Biharsharif is the hometown of Bihar Chief Minister Shri. Nitish Kumar. During his reign,
significant development activities have taken place here. All the adjacent villages are wellconnected with irrigational channels which make agriculture here, a perennial activity. Most
of households in slum of Ashanagar, Borbanna, Maharpar and Gagan Dewaan are involved in
vegetable and cereal cropping. Other livelihood activities are Bidi making, animal husbandry.
Mushroom cultivation is recently getting popular in household linked with Jeevika in
Nalanda and Rajgir.

22

Table 6: Major Livelihood Activities in Biharsharif

Source: FGDs

5.4. Ranking of Activities

The ranking matrix a part of AKSHARA livelihood framework ranks various identified
activities based on those parameters vital for sustaining it for long. First of all, rating is done
on the scale of 1 to 5 which is done by the participants of FGDs conducted at ALF and
CLF level, and then ranking is done based on the decreasing order of score. Finally,
mushroom cultivation is chosen as activity that needs to be promoted in that region.

23

Table 7: Ranking of activities in Biharsharif CLF

Activities>
Factors\/

Bidi
Making

Animal
Husbandry

Farming

Field
Labourer

Mushroom
Cultivation

Pattal
Making

Suitable for
health/lifestyle

Stable income in
entire year

Raw material market

available

Potential to employ
many individual

Least Influence of
middlemen in sector

TOTAL

12

12

15

13

Source: FGDs
Other potential activity next to mushroom cultivation is Pattal (traditional plates made from
leaves) making, as the raw material market was within the 50 kms range of Biharsharif and it
had a potential market in nearby districts.

5.5. Mushroom Cultivation in Nalanda District

Scores of women in Surajpur village of Nalanda district, Chief Minister Nitish Kumar's home
district, have taken to mushroom farming in a big way as a means for their socio-economic
emancipation. As many as 700 women in groups of 50 each are engaged in growing
mushrooms and are taking other women under their wings. A number of SHGs and farmers
help groups have also come forward with various incentives to enable village women to take
up mushroom farming as livelihood.

5.6. Feasibility test

The feasibility test for mushroom cultivation below explains the conditions prevailing for its
sustenance. In this test, 3 key-informants were AMPAS project officer in Biharsharif,
regional officer from NULM and head-trainer in RSETI Biharsharif. They were asked to rate
the following factors on a scale of 1 to 5 and their average score was taken into consideration.

24

Figure 9: Factors influencing Fungiculture

Factor
condition

Demand
Condition

Easy access to
raw material &
infrastructure

Demand for value

added production

Easy
availability of
skilled
workforce

Industrial
Condition

A vareity of
Value-added
products
production
possible from
mushroom

Season has
influence on
demand

Difficult in
micro-financing

Tremendous
scope for growth
in regional
market

Climatic
condition
influences this
activity

Difficulty to reach
distant supplies

Some barriers
available in
setting up of the
production
system

Financial
condition
informal
promotional
agencies present
Availability of
training from
ATMA at
minimal cost
Favourable
government
policies
Bank will
possibly provide
the loan

In the diagram above, the black font phrases are the negatives factors in the way to setup
Fungiculture, while the white lettered-lines persuades us to go with this activity. Mushroom
will therefore show how agriculture sector can contribute to economic growth. In addition,
value addition is one of the key areas that lead to competitive advantage of any product.

25

Figure 10: Livelihood Capital Table Biharsharif

Natural Capital

highly sensitive to weather condition, ingredients are

agricultural waste

Physical Capital

Infrastructure like road, water supply, etc. are issues

of concern
Well connected to market by rail & road

Social Capital
Human Capital
Financial
Capital
Spiritual Capital

Supporting government schemes that are being

utilised
Activity well respected in the community
Highly trained & skilled manpower required for this
activity
highly-labour intensive activity
regular bulk purchase of inputs required
Start-up costs not very high
Aspiration in members to learn new technology, skills,
etc.
There are also good risk mitigation tactics

Source: key informant interview and FGDs

This information is gathered with the help of key informants. These capitals are the assets
that are necessary for the setting up of these activities into main line. Most of the assets are
possessed by the member women living in Gagan Dewaan slum of Biharsharif to start
Fungiculture. Finally, above factors gave us the green signal to go with Mushroom
cultivation as the activities in nearby slums.

26

6. Value Chain Analysis of Mushroom Cultivation in

Biharsharif
6.1. Global scenario
The global outlook of mushroom industry indicate that china is the largest world mushroom
producer with over 1.4 million metric tons followed by U.S.A. Poland is the largest exporter
of mushroom in the world while U.S.A is the largest market for fresh and dried mushroom
globally. The mushroom consumption is mainly concentrated in six countries known as G-6
(USA, Germany, UK, France, Italy and Canada) consuming 85 per cent of world
consumption. The varieties of mushroom cultivated internationally are button (31%), shiitake
(24%), oyster (14%), black ear mushroom (9%), paddy straw mushroom (8%) and
milky/others.

6.2. Indian scenario

Figure 11: Types of Mushroom grown in India

Source: Sample photo

In India, mushroom has been a non-traditional cash crop grown indoors, both as a seasonal
crop and under the controlled environmental conditions. Punjab, Haryana, Himachal Pradesh,
Uttar Pradesh, Rajasthan and Jammu & Kashmir are the major producing States. Punjab,
27

Haryana and Himachal Pradesh account for nearly 90 per cent of country's production.
Punjab is the leading mushroom growing state accounting to 50 per cent of the total
production. Button mushroom is cultivated in temperate regions of India. Oyster, milky,
paddy straw mushroom is cultivated in the tropical and sub-tropical regions. Till early 1990's,
Indian contribution to world trade was minimal. It gathered momentum as the industry
became organised with establishment of large scale export oriented units. Total mushroom
exports from India in 2009-10 were around 11000 tonnes valued at Rs. 660 crore.
Major export destinations for Indian mushroom are US, Israel and Mexico. Button mushroom
accounts for approximately 95 per cent of total mushroom exports. Although the current
share of India in world exports is less than 1 per cent, India has a great export potential.
In India, about 40,000 tones are consumed per year. The productivity of mushroom is higher
than any crop. Total Mushroom production in India for 2014-15 is 51,600 tonnes and Bihar
accounts for around 100 tonnes. Button mushroom accounts for 90 percent of India's and 38
percent of the total world production of mushrooms. Mushroom growing is highly labour
intensive and requirement of land are is comparatively low.
Increase in purchasing power, change in taste and market efficiency are some of the factor
influencing consumption trends. However this is expected to change in immediate future.
Mushroom is a very high value niche product with great potential to contribute to enterprise
diversification and poverty reduction by utilizing agricultural wastes. This provides an
environmentally friendly disposal. Therefore, it presents a big opportunity to fight poverty
and starvation in many developing countries. Mushroom producers sell their products to
hotels and other retail traders.
Figure 12: percentage use of crop residues in India

Source: Sample photo

28

To win over consumers, farmers must struggle to identify the product value. Mushroom
consumption has increased in recent past but it can only go to a certain point. Farmers ought
to look for ways to add value to increase consumption of mushroom. Other than price and
quality, value addition now includes reliability and other factor including outlook,
attractiveness and

Table 8: Seasonality of Mushroom cultivation in India

Months>

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Varieties \/
Oster
Button
Milky white
Paddy
Source: Key informant Interview

Challenges
Most people do not want to consume fresh mushroom due to their different perception. As the
shelf life of mushroom is very less it is difficult to deliver the fresh supply to the destined
consumers. Most small scale farmers have realized the importance of adding value to the
freshly produced mushroom in order to increase their marketability. About 50% of mushroom
growers in the country process mushrooms and the major products are pickles (21%) and
dried mushrooms (35%).
However, these farmers face other challenges which limit them from taking part in value
addition. One of these challenges is lack of appropriate technology and equipment to process
and pack the value added products. Also, they are not in a position to produce large quantity
of mushroom to enable them to process variety of value added products. Besides that, the
farmers lack the means to advertise their products in order to increase awareness in the
market. For instance, to sell the products through supermarkets, one needs a bar code which
costs 10,000 and an annual fee of 6,000 making it unaffordable for many small
farmers (The Times of India, 2012).
29

Given that the farmers are participating in value addition in order to improve their
marketability, it become necessary to assess whether they are benefiting from value addition.
According to the above research, it is not clearly indicated whether farmers are benefiting
from the value addition or not. Therefore, this study intends to analyze the benefits versus
the challenges involved in mushroom value addition while trying to improve its
marketability.

6.3. Value Chain Analysis of Mushroom

Untapped potential
Mushroom is proficient means for transformation of agricultural wastes into valuable protein
and presents huge prospective for generating additional income and employment. In India,
the full potential of mushroom production is yet to be unleashed. The cultivation practice has
centered on white button mushroom, accounting for 85 per cent of the total production.
The domestic marketing channels lack adequate price support faced with erratic demand and
supplies. Lack of trained manpower is among other drawback for the growth of the
mushroom industry.
National Research Centre for Mushroom (NRCM) is the apex institute for providing technical
aid for mushroom cultivation in India. The establishment of NRCM has led to both horizontal
and vertical evolution of mushroom industry. To make Indian mushroom industry globally
competitive, NRCM has been authorized with Research & Development and dissemination of
the technical expertise to various stakeholders.

6.3.1.Primary Activities
6.3.1.1. Inbound logistics
Receiving Raw materials: Biharsharif is well connected with the villages and nearby towns
like Nalanda and Rajgir. As the raw materials required mostly the agricultural by-products,
they are available in plenty as this town has the highest per capita yield in agriculture in
Bihar. Mushroom spawns are provided by Buddha Mushroom Spawn Laboratory, Rajgir. The
tools required for mushroom cultivation are provided by Agricultural Training and
Management Agency (ATMA). ATMA also provides free or subsidised spawns to trainees.
30

Training and awareness: All the training related to Fungiculture and some of its value
addition process will be provided by ATMA, Biharsharif. Awareness generation, motivation
and involvement of women in cultivation of Mushrooms are also the part of training. Other
follow-ups that will be undertaken by ATMA include providing technical and financial
assistance to the SHG women for developing spawn/culture centres, Information
dissemination about the market available for different varieties of mushrooms, identification
and arrangement of suitable market for the collected produce and conducting meetings/
seminars/ workshops for providing common platform for farmers and marketers.

6.3.1.2. Operations
Mushroom house / rooms.
Incubation Room: This is a room for spawn running. This room can be either an R.C.C.
building or an Assam type room (i.e., any separate room in the house) and should be mounted
with shelves made of clean whole bamboo in three levels for keeping the block. The first row
should be 100 cms above the ground and the other rows should be at least 60cms apart.
Cropping Room: An ideal house/room would be an R.C.C. building installed with proper
insulation and provisions for heating and cooling the rooms. However, an indigenous low
cost house has been recommended using locally available materials like bamboo, thatch and
mud plaster. Walls of split bamboo plastered evenly with a mixture of mud and cow dung
may be made. Mud plastering should be done on the outside of the outside wall. The air space
in between the two walls will act as an insulator.

31

Figure 13: Construction of mushroom house

Source: Sample photo

A false ceiling is necessary to avoid adulteration of unwanted materials from the thatch roof.
Besides the front door, ventilators should also be given from both the upper and lower sides
of the front and the rear side of the room for proper exchange of air inside the room. The
house/room should be installed /framed with horizontal and vertical bamboo poles required
for hanging the block after the incubation period.
.

Process of Cultivation
For successful cultivation, careful attention has to be paid to three aspects viz. good compost,
reliable spawn and right temperature during budding period or else partial/complete failure of
the crop may occur. Natural compost is prepared from donkey dung and wheat or paddy
straw. Some amount of poultry manure and 3 kgs urea/ton of compost may be added.
Mushrooms are grown in wooden trays. They are filled well with the compost and pressed
firmly leaving 3 cm clear space on top of the tray. The grain spawn is dispersed over the
compost which is then roofed with old newspaper sheets and water is sprayed to provide
moisture. The trays are then stacked vertically. At a temperature of around 24 25C white
cottony mycelium spreads and permeates through the compost. Ultimately, the surface of the
compost is covered with half to one inch level of casing soil. It is sterilised with formalin to
kill unwanted microorganisms and moulds.

32

Figure 14: Process of Mushroom cultivation

Preparation of Natural
compost
Filling of wooden trays
with compost & pressing
Scattering of grain spawn
and covering of trays
Spraying of water and
stacking of trays
Source: Key informant Interview

Mushroom Processing
Value addition is done through processing the products into different forms which satisfy
different needs of customers as well as packaging it attractively Adding value to fresh
mushrooms usually means either developing a processed product, such as pickles, or
dehydrating excess mushrooms for sale in the off-season, when prices are higher. Fresh
mushrooms are highly perishable commodity and hence processing is recommended to
enhance their shelf-life. Initially, fresh mushrooms are washed in cold water and then
blenched in boiling water for about 3-4 minutes. Then they are dehydrated in a drier and
packed. It is suitable to pre-treat fresh mushrooms in a solution containing brine to prevent
staining. Packing is very critical as formation of moisture taints mushrooms very quickly.
Yield after drying depends upon many factors like moisture content in fresh mushrooms, type
of dryer, process employed, and moisture content required in the finished product etc. Hence
average yield is taken at 25%. Plain cans and a brine of 2% salt and 0.2% citric acid are used
for packing. The cans are exhausted at 19 C for 7-8 minutes, sealed and processed under
pressure for 20-25 minutes. The process flow chart is as follows:

33

Figure 15: Processing of Mushroom

Washing of Mushroom
in cold water
Blanching of Mushrooms
in Boiling Water

Dehydration &Packing

Processing of cans &

labelling
Source: Key Informant Interview
Mushroom can be made into different products such fresh mushroom consumed with other
foods. It can also be dried and grinded into flour which can be used to make different snacks
such as chapatti, cakes, sandwich samosa and crisps. Moreover, some other value added
products can be done like Mushroom pickle, Mushroom nuggets, Mushroom cookies,
Mushroom soup powder, Mushroom ketchup, Mushroom candy, Mushroom papad,
Mushroom powder.

6.3.1.3.Marketing
Need Identification
Mushroom is a very important commodity in this region and the country in general but the
demand of the commodity is yet to be established. The market of mushroom seems to
increase as the purchasing power of the population increases. The main consumers of
mushrooms are Chinese food restaurant, hotels, clubs and households. In big cities,
mushrooms are sold through vegetable shops. The growing domestic and export market as
also the delicacy and food value provides extensive and good potential for cultivation of
mushroom.

34

Consumer behaviour
Some distinguish mushroom as poisonous due to their experience of poisonous wild
mushroom species. While others associate mushroom with curative skill and consequently
they will not take them when they are in good health. To win over consumers, SHG women
must struggle to identify the product value. Mushroom consumption has improved in recent
past but it can only go to a certain point. Women linked with Jeevika ought to look for ways
to add value to boost consumption of mushroom. Other than price and quality, value addition
now includes consistency and other factor including viewpoint, attractiveness and other
factors. Mushroom value addition is simple as it looks but can be the difference between
customer fulfilment and disappointment. Marketing for both fresh and processed mushroom
is very acute factors as far as production and consumption of mushroom is concerned. Before
domestication, mushroom was being treated as wild crop and thus influencing peoples
attitude towards the crop. Many types of edible and medicinal valued mushroom have been
cultured. In this respect, marketability of various species fluctuates.

Factors affecting Market Demand

The consumer likings and perception have not been fully premeditated. This study will carry
out exploration of how mushroom is cultivated and marketed. The opinion and preferences
depend on the social level. Mushroom prices are also considered to be moderately expensive.
Demand of mushroom in various places varies over time. Demand for mushroom increase
with the increase in the number of consumers. Despite a recent upturn in demand, mushroom
consumption has been trending modestly same over the last few years. Unvaried consumption
may be due to higher prices, more careful analysis is required as there are many factors that
influence both output and prices. Consequently, it is not possible to assess whether the
apparent decline in demand is due to higher prices, consumer preferences shifting away from
mushrooms, or if mushroom marketing efforts simply have not been effective in recent years.

35

6.3.1.4. Outbound Logistics

Quality Control
"Prevention is better than cure" is the fundamental motto of mushroom growing. The
mushroom itself being a fungus, when fungal diseases appear, it is often very difficult to
control as the chemicals used against the disease may affect the mushroom itself. Thus,
infinite care has to be exercised from the very start to discourage the entry of any foreign
"germs" or contamination. The following precautions should not be over-looked. The very
first requirement in mushroom growing is sanitation and hygienic conditions. Most of the
problems in mushroom growing arise due to improper hygiene:
1. The room where mushrooms are to be grown should be thoroughly washed and then
whitewashed with lime. The floor should also be limed.
2. The surrounding of the house should be devoid of stagnant drains, shrubs and other weeds
as these harbour harmful diseases and insect pests.

Sales & Distribution

The market of mushroom in Biharsharif division can be fully effective if comprehensive and
customer focused value addition techniques are developed. It was also observed that small
scale mushroom cultivators of Surajpur and Sarai Chak produced too little mushrooms to
sustain the market and there were weak linkages between production and marketing. The
mushroom growers of Jeevika were new in the market and they had not developed a good
strategy of selling their products. However, this was attributed to low production and lack of
information to do more value addition. The distribution strategy will be the same as we have
adopted for Phenyl and Detergent production in Gaya.
For Business-to-business (B2B) distribution fresh mushrooms and its value-added
commodities will be distributed to supermarkets, hotels and restaurants. This will be done by
indirect distribution which will involve procurement department of the organisation and other
middlemen who will gather link and contacts for sell generation.
For Business-to-customer (B2C) distribution will involve direct distribution to consumers
via the SHG and ALF meeting centres. Each slum will have a distributor/retailer in its ALF
centre from where direct selling to customers can be done. Generally, the direct selling to the
women members of Santoshi Mahila Vikas Swalambi Sahkari Samiti Ltd. (Biharsharif CLF)
will be done during the monthly meeting of ALF and CLF. Rest of the value-added stock will

36

be kept in the ALF meeting centre for limited time and will be managed by their respective
president and vice-president.

Figure 16: Distribution Channel for Mushroom

Santoshi Mahila
Mushroom Production
& Processing

Super
Distributor

B-2-B
distribution

4 ALFs(registered
one)

Consumers

Supermarket
and selected
venders

B-2-C
distribution

Hotels and
restuarant

SHG member
women

Source: Key informant Interview

6.4. Cost-benefit of a sample value-added product of mushroom

ARR = (Average revenue / Initial capital costs) * 100, Where, ARR is the average rate of return. In
this case, the initial capital represents the cost incurred by the SHG women after production with an
aim of adding value. Average revenue represents the revenue obtained after selling the value added
products. In our case, the average revenue for 1 kg button mushroom pickles obtained is 226. The
expenses incurred include.
RAW MATERIALS
Button Mushroom
Gingelly oil
Spices (turmeric, chili
powder)
Ginger
Garlic
Vinegar
Labour, bottling and
labelling
Total

AMOUNT
600 gms
200 gms
50 gms
50 gms
50 gms
75 ml(~50 gms)
10+ 5+1

COST()
120
30
30
10
10
10
16
226

37

Market price of Duo-pack of 400gms bottles of Button mushroom is 300-360. Let us assume it to be
330.
ARR= (Average revenue / Initial costs) * 100
(330/226)100= 146%
Using this method, it is clear that adding value to mushroom is highly beneficial to farmers. This is
further explained by the fact that the average bottles sold do not include the spoilt ones.
Benefits

Costs

Prolonged shelf-life- when mushroom is dried

Increased cost of owning a more advanced drier

and processed into flour, its shelf life is

which uses electricity.

improved.
Different value added products such as papad,

Additional activities which also involve more

ketchup and pickles increase the margin of

cost for instance when making pickles you need

profits.

to buy cooking oil, salt, wrapping materials and

spices.

Increased number of customers this is as a result

Amplified transport cost to reach wide range of

of having different value added products which

customers.

satisfies different customers needs.

Caselet 2: All because of Mushroom

In recent times, Nalanda is getting limelight for the whopping entrepreneurship of women living in villages cultivating
mushroom. Nearly 200 households in villages like Surajpur and Sarihchak are engaged in cultivating almost all kinds of
mushroom. The story started from a single lady who motivated other women to come forward and form producer groups.
Rita Devi, a 54 year old lady had done her schooling till 12th standard after which she was married to Mohan Gupta of
Surajpur village in Nalanda. He was a labour contractor in brick kilns in nearby villages. They had 2 sons and a daughter,
all pursuing their studies at different levels. They lived in a semi-pakka house with little basic amenities. In 2007, Mohan
ji met an accident at his workplace and died. After him, it was extreme difficult for Rita Devi to revive her family needs
as till now she has been a housewife and no idea how to earn bread for her family. During 2010, Jeevika promoted
various livelihoods schemes and pushed the formation of SHGs of women. Finally, she picked up the task of mushroom
cultivation and collected all the relevant information regarding it. Initially, she got training in mushroom cultivation from
Rohtak Agricultural Training Centre. After this she went to practice it further in Sonipath Murthal and Shobra College.
After this, there was no turning back for, as she was determined to start this activity in her house itself. She got microfinance assistance from the NGO and took the loan of 10,000 to start her business. Soon, she started production of
mushrooms of different types. She marketed her product to niche class segment (Doctors, government officers, etc.) in
Bihar Shariff. Later on, she started some value addition to mushroom like processing of dried mushroom, mushroom
pickles and mushroom powder. As she grew popular in her region, many women started approaching her for training for
38
which she opened a Training Centre in her house which is popular
by the name Nalanda Mushroom Utpaadan Kendra.
The journey was that never easy for a widow lady, but Rita Devi has proved her metal and become the idol of Surajpur.

6.5. Conclusion
Farm and household characteristics influence farming decisions are important in
understanding decisions relating to how much a particular household will grow and add value
to mushroom. Cost-benefits analysis of adding value to mushroom was carried out using
ARR method which showed that farmer benefited from mushroom value addition when
selling their product. The major benefits of adding value include increased sales, prolonged
shelf-life and varieties of value added products. The common challenges they faced include
lack of access to large market share due to low production and value addition. There is also
lack of capital to invest in new technology that will enable them to produce a wide range of
value added products.

6.6. Livelihood Intervention in Biharsharif CLF

Similarly, as the intervention is planned for Gaya CLF, all the steps of Akshara Livelihood
framework have been used for Biharsharif. The following table explains how the proposed
activity will change the face of Biharsharif SHG women.
Table 9: Four-Arrow Outcome in Biharsharif CLF

Before Intervention

After Intervention

Income: being a flood-prone region, crops are

damaged resulting in irregular income, unfair
compensation for high-labour intensive work

SHG women will be able to earn average income

of 80-100/day in an established value chain as
this is not a complete field activity

Expenditure: Individual activities increases raw

material procurement cost and technical assistance
is difficult for agencies.

Group activity will decrease cost significantly with

bulk procurement and monitoring becomes easy.

Employment: extreme vulnerability in finding

suitable livelihood activity

This activity will engage 30 women in production,

30 in distribution

Risk: no guarantee for work, seasonal fieldlabourers and bidi-makers are workless rest of the
year

This activity will provide work for throughout the

year by growing different varieties suitable to the
season

39

6.7. Recommendation
From this study and the conclusions, the following recommendations are made:
That further studies need to be done on the benefits of mushroom value addition from production
point of view. This will show whether value addition can reduce the number of years used to pay
back the initial cost of undertaking mushroom enterprise as whole.
That mushroom growers should join together and collectively support rural and urban women and
allow then to contribute in making value addition in order to increase the number of value added
product and hence increase their market share.
That mushroom farmers should share cost of adopting new technology of adding value.
That government and donors should fund such emerging and high value agricultural enterprises as
way of achieving the vision 2030.

40

Appendix
Appendix 1: Complete Cost estimation of Detergent manufacturing
BASIS AND PRESUMPTIONS
1. Single shift of eight hours a day, 25 days a month and 300 days in a year is
presumed. Efficient Machines and workers are also presumed.
2. Minimum six months period is considered for achieving full capacity utilization.
3. Labour rates are as per the prevailing rates.
4. An average interest rate of 18% is considered.
5. The estimates are drawn for a production capacity generally considered technoeconomically viable for model type of manufacturing activity.
IMPLEMENTATION SCHEDULE
Normally two months are required for the complete implementation of the project, including
machinery erection, raw materials procurement etc.
FINANCIAL ASPECTS
i.)

Production target for Shakti Mahila Sahkaari Sangathan Samiti: 8000 kg per annum

ii.)

Utilities: Power: nominal, Water: Abundant supply required

FIXED CAPITAL
Land and Building: Rented per month

Nil

MACHINERY AND EQUIPMENTS (ALL ITEMS ARE INDIGENOUS)

1
2
3
4
5
6

Stainless steel/MS Ribbon Blender 50 Kg capacity 1

(2 HP)
SS Trays/Plastic Trays/ Enamelled Trays
2
Weighing Balance ( 15 Kgs.cap.)
1
Misc. equipment like Plastic Buckets, Storage drums
etc., and plastic heat bending mc/(H.O)
Office equipment like Chair, table etc.
installation charges at 10% of cost of machinery and
equipment

Total

60,000
5,000
15,000
25,000
15,000
6,000
1,26,000

ix

WORKING CAPITAL PER MONTH: PERSONNEL

Chemist-cum-Manager
Unskilled Workers
Total

1
3

5,000
3,000
8,000

RAW MATERIALS
Sl.No.

Name of Items

Acid slurry

2
3
4
5
6
7
8
9

Soda Ash
Trisodium Phosphate
Sodium tri polyphosphate
Corboxy methyl cellouse
Guaubers salt
Color
Perfume and Brightner
Packing

Kgs.

Rs./Kgs.

Rs.

225

60

13,500

573
125
100
6.25
245
1.25
1.25
1300

18
20
38
45
10
350
150
50 /
Cover

10,314
2,500
3,800
281
2,450
438
188
1,300

Total
Say

34,770
35,000

UTILITIES PER MONTH

Power
Water
Postage and Stationer
Consumable Stores
Repairs & Maintenance
Total

Rs. 600
Rs. 650
Rs. 500
Rs. 500
Rs. 500
Rs. 2550

TOTAL RECURRING EXPENDITURE ---------------------- Rs. 45,500

TOTAL CAPITAL INVESTMENT
Fixed Cost

Rs.1, 26,000

Working Capital in Three Months

Rs.1, 36,500

Total

Rs.2, 62,500

FINANCIAL ANALYSIS: COST OF PRODUCTION PER YEAR

Total recurring cost/year
Depreciation on machinery @ 10% on 1,05,000/Total
Say

Rs.5,46,600
Rs.10, 500
Rs.7, 13, 280
Rs.7, 13, 300

TOTAL SALES (Per Annum)

By sale of 15600 kgs of Detergent powder -----------------------------7,80,000
@ Rs. 50/- per packet
PROFITABILITY (Per Annum)
Profit = 7, 80, 000 7,13,300
= 66,700
FIXED COST
Depreciation of Machinery ------------------------------------------10,500/Interest on total investment ------------------------------------------35,100/40% on salary and wages --------------------------------------------59,000/40% of other expenditure----------------------------------------------7,200/1,41,800
B.E.P.: Fixed Cost * 100 / (Fixed Cost + Profit)
1,41,800 x 100 / (1,41,800+ 66,700)
= 22,300 units

xi

Appendix 2: Complete Cost estimation of Phenyl manufacturing

BASIS AND PRESUMPTIONS
1. Single shift of eight hours a day, 25 days a month and 300 days in a year is
presumed. Efficient Machines and workers are also presumed.
2. Minimum six months period is considered for achieving full capacity utilization.
3. Labour rates are as per the prevailing rates.

IMPLEMENTATION PERIOD
Proposed Project can commence production within 4-6 weeks after sanction and first
disbursement of sanctioned loan.
PRODUCTION TARGETS
Production target for Shakti Mahila Sahkaari Sangathan Samiti: 1000 ltrs/month
LAND & BUILDING
1. Covered area Sq. Ft.

500

2. Uncovered area Sq. Ft. 500

3.

Total

area

Sq.

Ft.

1000
MACHINERY AND EQUIPMENT
S.no.

Description

Qty

Mixing Machine

Reaction cattle

Filling Machine

Storage vessels

Hand Tools

LS

Sales Tax, Freight &

Value (Rs)
230000

23000

Insurance,etc
Total

253000

xii

RAW MATERIAL (PER MONTH)

S.no

Particulars

Quantity ( ltrs)

Value (Rs)

Pine oil

680

91800

EmulsifierOP-95

300

27000

Preventol KMX

Bottles for packaging

20

2800

LS

2000

Total

123600

WORKING CAPITAL (FOR ONE MONTH)

SNO

DESCRIPTION

Raw material

Other Expenses

AMOUNT(RS)
123600
14000

Total

137600

TOTAL CAPITAL INVESTMENT

Machinery & Equipment

253000

Working capital for one month

137600

Total

390600

Sales

543000

Break Even Point

54.27%

xiii

Appendix 3: Complete Cost estimation of Mushroom Cultivation

Cropping: Mushrooms prop up in 30-35 days. In a cropping cycle of 8-10 weeks an average yield of
10 kg mushroom/sq metre is feasible.
i.)

Production target for Satoshi Mahila Sahkaari Samiti: 8000 kg per annum

ii.)

Utilities: Power: nominal, Water: Abundant supply required

Details of plant & machinery

S. No.

Item

Qty

Rate (Rs.)

Value (Rs.)

1.

Wooden tray

450

150.00

67,500.00

2.

Sprayers & pump

1,750.00

5,250.00

3.

Automatic humidifier or cooler

4,500.00

4,500.00

4.

Room heater or blower

2,000.00

6,000.00

5.

Other tools (thermometers, fans etc.)

4,000.00

6.

Misc. tools

2,750.00
TOTAL

90,000.00

Raw material requirement (including consumables/month)

S. No.

Items

Quantity

Rate (Rs.)

Annual value
(Rs.)

1.

Fertilizer including casting soil

3000 kg.

Rs.10/kg

30,000.00

2.

Mushroom spawn

400trays
(or800bottles)

Rs.16/tray
(Rs.8/bottle)

6,400.00

3.

Chemicals (Formaline, Pesticide,

insecticide etc.)
L.S

4,000.00

4.

Packing material

2,000.00

TOTAL

42,400.00

L.S

xiv

Manpower requirement
S. No.

Category

Nos.

Salary/person/

Total monthly

month (Rs.)

Salary (in Rs.)

1.

Skilled

01

2,000.00

2,000.00

2.

Unskilled

02

1,500.00

3,000.00

TOTAL

5,000.00

Working capital (at full capacity utilization)

S. No.

Items

Period

Amount (in Rs.)

1.

Raw material

15 days produce

21,200.00

2.

Recurring expenses (power + wages)

1 month

7,000.00

3.

Other misc. expenses

2,000.00
TOTAL

30,200.00

SAY

30,000.00

Cost of project
S. No.

Item

Total cost (in Rs.)

1.

Building (1000 sq.ft)

Self/on rent

2.

Plant & machinery (including setting up)

90,000.00

3.

Furniture & fixture (including office equipment)

7,000.00

4.

Preliminary & preoperative expenses

3,000.00

5.

Interest during implementation, contingencies including cost

increase, etc.
10,000.00

6.

Working Capital

30,000.00

TOTAL

1,40,000.00

xv

Project economics
S. No.

Items

Amount (in Rs.)

A.

Sales insight: Mushroom 8000 kg x Rs.40/kg. and

compost[Rs.320000+Rs.80000 p.a.]

4,00,000

B.

Production Cost

(i)

Raw materials (Rs.42400/produce * 3 produce with packing

resources)

1,27,200.00

(ii)

Utilities (power, fuel, water etc.)

25,000.00

(iii)

Salary and wages (Rs.5000 x 12 months)

60,000.00

(iv)

Rent (Rs.2000 x 12 months)

24,000.00

(v)

Conveyance/merchandise

5,000.00

(vi)

Dealing & Traveling

5,000.00

Administrative
(vii) etc.)

expenses

(Telephone, postage, stationery

5,000.00

Selling overheads (including advertising, distribution cost,

(viii) commissions & rebates)

10,000.00

(ix)

Insurance & misc.

4,500.00

(x)

Reparation & maintenance

5,000.00

(xi)

Interest repayment

8,300.00

(xii) Nourishment for applicant

30,000.00

Grand total

C.

Gross Income (A-C)

D.

Depreciation at the rate of 10.0%

amortisation of expenditures

E.

Net Income (D-E)

3,09,000.00

91,000.00
of

fixed

assets

and
11,000.00
80,000.00

xvi

Annexures
Annexure 1: Questionnaire for FGDs in Slums
Slum:
Number of SHGs:
TLF/ALF Name:

S.no

Livelihood Activity

Number of SHG Women

Others

Tool: Group Discussion for Market Opportunity

Comes In / Trade In Questions (Slum: as a market):
1.1. What products and services do people often obtained from outside of slum? (i.e. what
comes into the slum?
1.2. Where do these products and services come from? (Nearby slum, town, district, or region)
1.3. What are the challenges to setting up this activity within the slum? (i.e. why is it not
available in the slum at present?)
1.4. What is the scope or potential? (i.e. how many would use this service in the slum?)
Above questions are represented below in a tabular form:

1.1) What Products

& Services used but

1.2) Where from?

1.3) Challenges to
setting up within slum

not produced?

xvii

1.4) Scope /
Potential

Goes Out / Trade Out Questions (Slum: as a production centre):

2.1. What are the existing livelihood activities in this slum?

2.2. What activities are insufficient to meet local needs (local demand)?
2.3. Do these products and services go outside the slum? (i.e. serve customers outside the slum)
2.4. If yes, where to? (E.g. nearby slums, town market, district, region)
Above questions are represented below in a tabular form:

2.1) Existing
Livelihood Activity

2.2) Sufficient to

2.3) Goes out of slum? 2.4) Where to?

meet slum

(i.e. customers

(nearby slum,

demand? (If not,

outside of slum?)

town, district, or

why not?)

(Yes/No)

region)

Ranking of Livelihoods:
1. What are the main sources of livelihoods and cash income in the area?
2. Rank the sources of livelihoods in order of importance.
3. What livelihood activities are important sources of cash income?
4. What differences do you observe for women and men, or other social differentiation (e.g., access to
land and livestock, control over production and sale)

xviii

Template for analysis livelihood analysis

Current

Contribution

Contribution to

Trends

Differences

sources of

to

cash income

(1=becoming

in terms of

livelihoods

livelihoods

(1=very

more important

gender,

(Rank in order

important,

2= same as

age, ethnic

of

2=somehow

before

minorities,

importance)

important,

3=less important,

and

3=not important)

4=new activity)

explain

Tool: Livelihood Selection Questions

Purpose: To Select priority activities for Focus Group Discussion or Household Interview.

Question

Yes/No

Does the activity seem suitable for a poor womans lifestyle and health?

Is it an artisan or production-based activity?

Does the activity provide a stable income the entire year?

Is there growing demand for the activity? Is there demand for such an
activity outside the slum?

Is there potential to employ many individuals in the slum / town with this
activity? (i.e. sufficient potential to scale-up)

Is the activity easy to establish (in terms of skill, inputs required)? Is the
individual independent (or part of a group) and not under the control of
middlemen?

Is the activity good for the environment?

xix

Annexure 2: Questionnaire for Sub-sector Analysis and Value chain

Analysis

Tool: Single Activity Focus Group Discussion (for Sub-sector Analysis)

Select one to three activities per slum.
Invite around 10 women engaged in the same livelihood activity which is ranked highest in
above tool.

General Questions:
1. A) How many members are doing this activity in this slum?
B) Is it a family or individual activity?
2. Describe the total process of your livelihood activity.

3.

A) How do you feel about your activity?

B) How do your family, neighbours, and others view your activity?

4. A) Has your income increased or decreased over the past 5-10 years?
B) What is the average income?
5. Do you want to continue this activity? Or would you shift to a new activity if you had
the opportunity? Why or why not?
6. Do you want skills upgrading or new skill training? What kind?

Production-Based Activities:
11. How can you add value to your current activity? (e.g. cleaning, sorting, packaging,
etc.)
Labour-Based Activities:
11. How do you find customers / employment opportunities?
12. What role do middlemen play?

xx

Tool: Draw Value Chain

1 .1

Guiding Questions for Value Chain Drawing:

Who are the main actors?
What are the basic raw materials? Where do you get the raw material from?
What is produced at each step?
Where do your outputs go? Who buys it?

1 .2

Guiding Questions for Quantifying the Value Chain:

How many enterprises / operators are at each level?
How many individuals work in each category? How many poor and women at each
stage?
What are the prices paid at each stage?
What are the volumes and turnover at each stage?

2 General Discussion Questions:

What influences inputs and outputs?
What kinds of organizations and institutions do you interact with? (e.g. SHG,
federation, bank, panchayats, middlemen, weather, floods, network,
infrastructure, skills or training needed, savings, loans, etc.)
How important are these organizations and institutions to you? What is your
relationship with these institutions? What influences your relations?
Do you feel you have control (direct or indirect) over various parts of the
value chain? Which parts do you feel you have no control over?
Do you have ideas of how you can add value to your current activity? (e.g.
cleaning, sorting /grading, packaging, etc.)

xxi

Annexure 3: Questionnaire for In-depth Interview

Tool: Key Informant Interviews
Scale:
5 = Very Good, 4 = Good, 3 = Average, 2 = Bad / Poor, 1 = Very Bad / Poor

Livelihood Activity / Sub-sector:

Key Informant 1 (name, role):

Key Informant 2 (name, role):

Key Informant 3 (name, role):

Key Informants
Activity
1
1.1

Factor Conditions
Availability of raw materials (easy access
nearby-5, difficult access or far away-1)

1.2

Availability of skilled workforce (Does this

activity require skilled manpower? If you
had to hire a helper, how easy would it
be to find a skilled helper?)

1.3

Is a particular workspace required (for

production or storage)? (can work from
home-5, must rent facilities-1)

1.4

Climate suitability (climate has no impact5, climate sometimes impacts-3, climate

heavily impacts-1)

1.5

Availability of capital (easy to get loan-5,

difficult to get loan-1)

1.6

Availability and reliability of

infrastructure (e.g. power, water, roads,
storage, etc.)
Demand Conditions
xxii

Averag
3

Natural Capital

N.1 Is the activity highly sensitive to

weather conditions? (no-5, yes-1)
Average
P

Physical Capital

P.1 Is there specific equipment for the

livelihood activity? Is it difficult to
obtain and maintain? (no-5, yes-1)
P.2 Are there any problems with
infrastructure? (e.g. water supply and
sewage, power, roads, etc.) (no-5,
yes-1)
P.3 How easy is to reach markets for
obtain input or sell outputs? (well
connected-5, poorly connected-1)
Average
S

Social Capital

S.1 Are there supporting government

schemes? Are they accessible and
utilised? (yes-5, no-1)
S.2 Does the activity have potential to be
undertaken as a cooperative /
collective / group? Is there any
interest? (yes-5, no-1)
S.3 Is the activity accepted and respected
in the community? (well respected-5,
looked down upon-1)
Average
H

e.g. Sari

e.g.

Kirana

business

Pickle

shop

Livelihood Activity
N

e.g.

Human Capital

H.1 Are very specific skills required for

this activity? (no-5, yes-1)

xxiv

making

H.2 Is skill training / upgrading easily

available? (yes-5, no-1)
H.3 Is the activity physically very difficult?
(no-5, yes-1)

Average
F
F.1

Does the activity require periodic bulk

purchase of inputs (thus access to
money at key times)? (no-5, yes-1)

F.2

Are bankers inclined to lend to this

activity? (yes-5, no-1)

F.3

Are start-up costs very high? (no-5,

yes-1)
Average

R
R.1

Is there general aspiration to learn

new technology, processes, skills,
etc.? (yes-5, no-1)

R.2

Is there vision and plan for the

future? (i.e. where want to be in 5-10
years) (yes-5, no-1)

R.3

Are there good risk mitigation tactics?

(yes-5, no-1)
Average

xxv

References
Kaplinsky R. (2000) .Globalization and Equalization: What Can Be Learned from Value
Chain Analysis? Journal of Development Studies 37 (2): 117-146.
Naegely, Stella K. (2000). Is there money in mushrooms? American Vegetable Grower.
February. p. 4043.
Stamets, Paul. (2001). A novel approach to farm waste management. Mushroom the Journal.
Winter. p. 22. Or see at <http://www.fungi.com/mycotech/ farmwaste.html>.

Emily Jansons. (2013) .Urban Livelihood Mapping & Assessment Toolkit

http://www.census2011.co.in/data/bihar/gayadistrict.html
http://www.census2011.co.in/data/bihar/biharsharifdistrict.html

xxvi