The beginning and evolution
BRAC Recycled Handmade Paper (RHMP) was initiated as a Rural Enterprise Project (REP) in 2000 with an aim to help prevent environmental degradation by targeting the corporate urban market in Bangladesh to recycle their paper waste. On a different note, it was also introduced to support a small group of drop out female students from BRAC’s education programme by providing them jobs at the production facility of this enterprise.
Being a pioneer in the promotion and development of recycled handmade paper and paper products in Bangladesh, this project later evolved into an enterprise in 2009. Although there have been a few scattered producers of this product feeding the niche market and export industry of Bangladesh prior to the evolution of this enterprise, BRAC Handmade Recycled Paper happens to be the first entity to make a proactive approach by manufacturing and retailing the products in urban market under the brand name Kanon.
The present scenario
Today people are more environmentally conscious, and hence their response towards this enterprise is accelerating faster than ever. The idea of reducing paper wastages and modifying them into creative stationeries intrigue most people, and the satisfaction of contributing even a tiny portion to the environment happens to be a cherry on top. Today BRAC RHMP operates as one of BRAC’s three Green Enterprises, and produces synthesised paper products from recycled materials, such as, used papers, stalks of wheat, hay, water hyacinth, caustic soda, dye, barley, glue and cotton. These materials are gathered from various BRAC projects and branch offices, thus helping reduce the amount of waste produced by BRAC, and contributing toward employment generation for women and ‘going green’ initiatives nationwide in the process.
In addition to its committed contribution to the environment, BRAC RHMP has also been supporting the all-female employee group working at the production facility with unequivocal employment opportunities and fare wages. About 100 women are currently working at the production facility of this enterprise, located at Shombhuganj, Mymensingh, and their payments are made based on the quantity of products they put together. Hence the more products get sold in the urban market, the more income these women are able to generate. As these products are strictly handmade, more women are going to get employed at the production facility if the market demand increases. Apart from the workers, the customers belonging to the urban population group, especially the corporate offices also fall into the category of BRAC RHMP beneficiaries as they are actually able to reduce the wastage of paper by exchanging these with this enterprise, only to purchase brand new items manufactured by their own waste.
Change in goal/mission
The mission of the Recycled Handmade Paper enterprise has not changed, but rather modified and expanded. At first it was only to recycle and reuse the paper wasted by most of the corporate lines. But now it has started retailing its products at BRAC’s brand new green outlet named Kanon. An exchange offer is going on at present in which any corporate enterprise can deliver its wasted paper to RHMP to get them recycled so that these are bought back again by the same enterprise. This is playing a huge role in decreasing the wastage of paper in corporate offices and thus helping our environment in the process. In this offer, the RHMP collects the paper waste of corporate offices to modify and customise them into handmade paper or paper products as per their demand and sell it back to them. They can also place their orders from a range of products already offered by RHMP.
The market for recycled handmade paper products is growing rapidly; hence it is more likely to be expanding in the near future. Introduction of a new, mechanised process in making the products is being planned. The mainstream paper products are going to be handmade as usual, but the now semi-mechanised production of paper is going to be mechanised to support a larger scale of production and meet the growing demand for recycled paper in Bangladesh. One of the most important goals are to make the handmade recycled paper and paper products more accessible in the urban market, thus providing more income generating opportunities for rural women.
BRAC printing pack started its operations in 2005 to ensure quality of the final packaging of products for BRAC dairy, BRAC salt, and BRAC seed. The operation of this enterprise is different than the others; whilst its social objectives include healthy packaging and income generation for their more than 150 permanent workers; their main goal is to support the other BRAC enterprises, which now include Aarong.
The Enterprise approach
One of the unique approaches of BRAC social enterprises has been to internalise the supply and packaging chain within the BRAC enterprises to generate the highest possible value for the final marketed products. This approach, besides cutting the supply cost, internalises a significant portion of the surplus benefitting the development programmes while ensuring an optimum quality. Although this enterprise was initiated to ensure quality packaging for the products of BRAC dairy, BRAC salt and BRAC seed, it has become one of the significant competitors in the packaging industry.
BRAC printing pack has developed a well organised system of production; its sales staff collects orders from the customers who specify the design and the quantity of packaging required before production. Then it orders the design cylinder from external sources and commences the production. This approach helps to prevent any excessive production and the need for a design team, thus cutting waste and design cost. Its focus is to be as efficient as possible so that it may achieve optimum results.
The market scenario
Despite being one of the newer BRAC enterprises, this well planned enterprise has been a successful and competitive market player. BRAC printing pack’s efficiency model has generated surplus every year and increased its capacity from its starting 120 metric tons to a 1,500 metric tons in only a few years. However, as the market competition is getting fiercer by the day, there are no current plans for future expansion within this enterprise. For most of the products which the BRAC enterprises have been commercially retailing, e.g. dairy, salt, seeds, chicken, etc. a high demand of quality waterproof sealable packaging strongly prevails, which the BRAC printing pack alone meets, by providing over 80 per cent of BRAC’s packaging services, while catering to other big corporate customers such as ACI and Square Pharmaceuticals. It also packages well known food products in Bangladesh, such as Ruchi Jhal Chanachur, Energy Biscuit, etc.
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A Pioneer in the development of the poultry industry in Bangladesh
BRAC Poultry has become a successful enterprise in Bangladesh, both in terms of its social impact and surplus generation. It started with two hatcheries in Savar and Rajbari, and has since increased its capacity to six hatcheries. During the Avian influenza in 2007-2008, BRAC Poultry, along with the rest of the country’s poultry farms, experienced a substantial loss of (nearly BDT 10 million; USD 120,660). However, in the following years BRAC Poultry started to generate a surplus of nearly BDT 25 million (USD 301,667) per year, due to the supply shortage of day-old chicks and the closing of many other poultry farms affected by the bird flu.
BRAC Poultry managed the avian influenza outbreak by constantly monitoring the poultry and exercising strict quality control. As a result, not only has BRAC Poultry generated a surplus since then, but the number of day-old chicks it supplies has increased from 165,000 per month to 180,000. The enterprise's plans for the future include building new sheds on the existing farms, which will increase their capacity to over 200,000, making them part of the largest hatcheries in the country.
The early days
Collaboration to serve utra poor families
BRAC's Poultry enterprise started out in 1987 as a development initiative in collaboration with the United Nations World Food Programme (WFP), with the name – the Income Generation for Vulnerable Groups Development (IGVGD) programme. The main benefactors of the programme were the people who were recognised by the UN to be ultra poor and thus became recipients of the UN VGD (Vulnerable Group Development) cards. In the late 1980s only the governmental poultry farms had access to poultry vaccinations, and most rural farmers were unaware of the higher-yielding breeds of poultry that the government farms were developing. In order to introduce both poultry vaccinations and high-yielding varieties of poultry into the Bangladeshi market, BRAC initiated its poultry project.
Livelihood opportunity for women in rural communities
The programme first sought to educate and train the VGD card holders on poultry rearing and poultry vaccinations. Then, BRAC would purchase high-yielding varieties of day-old chicks from governmental poultry farms to provide VGD card holders with access to these breeds. BRAC divided the programme participants into several categories such as vaccinators, farmers who would rear the day-old chicks until they were mature, farmers who would then breed around 10 chickens, and finally the egg traders who would collect and then sell the eggs on the market. The primary objective of the programme was to involve women in income-generating activities in a way that they could perform their household duties and rear poultry on the side, earning an income equivalent to the price of the monthly VGD ration they received, creating a source of revenue for them.
Meeting new market demands
This programme was continued until 1993 with the aid of WFP donations. As the WFP funding for the programme ceased, IGVGD became solely a BRAC programme that continued until 1997; after which all donor-funded poultry programmes were scaled down and only certain projects involving clients from BRAC's ultra poor programme were kept in operation. By then, the programme had already achieved its aim, as both high-yielding varieties of poultry and the vaccinations required to keep these healthy had become widely available in the market. Some of the groups previously involved in the programmes, such as the vaccinators, became independent entrepreneurs who proceeded to collect the vaccines from BRAC Head Office and continued with their work. As the donor-funded programmes were wrapped up in 1997, BRAC recognised a shortage of government-provided day-old chicks and thus started its own commercial hatcheries to meet the demand for healthy chicks amongst the VGD card holders. They gave around ten chicks on credit per customer, which they would reimburse in installments.
The evolution of BRAC Poultry
In 2003, as BRAC Poultry became one of BRAC’s social enterprises, the target group of beneficiaries and the operations of the hatcheries changed. In lieu of directly selling the day-old chicks to rural farmers, BRAC Poultry began to distribute the chicks to both BRAC's rearing farms and 250 dealers around the country, who then proceeded to sell the chicks to the farmers. These dealers, along with the workers of the BRAC Poultry-related chain became the new beneficiaries of BRAC Poultry. The objective of BRAC Poultry has been, and still is, to sell these high-yielding, good quality varieties of day-old chicks to rural farmers at a lesser price than the market price, giving them better value for money and therefore supporting them in their activities.
Historical background and social missions
BRAC Fisheries was initiated in 1976 as a post war rehabilitation effort for destitute women in remote areas. These areas, which were surrounded by water bodies that had no previous use, provided the locals with the opportunity to earn an income. BRAC’s intervention carved a pathway for them to use their local assets and resources to generate income. Initially, BRAC provided training and technical support to the people interested in cultivating fish, and the social mission back then was to provide these previously unemployed people with work that would lead to financial solvency for them. However, soon BRAC realised that there was a lack of quality fish spawn in the market as it was difficult to collect the product from the government or external sources and supply it to the local fish farmers. To meet the demand, BRAC initiated its own fish hatchery, which then evolved into an enterprise in 2008, with a new social goal to their existing agenda – making quality fish spawn easily available to the fish cultivators of rural Bangladesh.
The enterprise today
Since their journey began as an enterprise, BRAC Fisheries have earned a reliable position in the fishery industry of Bangladesh. Under a strict supervision for quality control, it produces and sells the three most popular varieties of fish spawn in the urban market – prawn, carp and tilapia, which can be yielded in a higher scale of production. Being one of the first fisheries to realise the potential large market for tilapia across the country, BRAC Fisheries now produces and supplies over 100 million tilapia spawn all over Bangladesh.
The enterprise approach
Since evolving into a social enterprise, BRAC Fisheries has been undertaking goal oriented approaches in increasing its productivity. Initially, due to the workers not being accountable to anyone for their performances, their productivity was not up to the mark. Later, when this initiative evolved into a social enterprise, BRAC started training these workers to be more commercial in terms of efficiency. They were now working more hours and more efficiently to reach a specific target set by BRAC Fisheries. As a result, their production increased from 50 kilogrammes per decimal to almost 150 kilogrammes per decimal. The vast increase in the workers’ efficiency has proved to be quite fruitful, and BRAC Fisheries now has 15hatcheries in 10 locations all over Bangladesh, generating a surplus of nearly BDT 32 million that goes into funding BRAC’s development programmes. They have also worked far in fulfilling their social mission – the rural population involved in BRAC Fisheries are now solvent and highly educated in this field, they have also played a major role in distributing high quality fish spawn throughout Bangladesh in a commendable quantity.
As one of the most successful ventures of BRAC’s social enterprises, BRAC Fisheries is looking forward to an even brighter future. It plans to develop more varieties of fish spawn. One of the goals that BRAC Fisheries is now looking forward to reach is the production of nutrient fishes for dietary benefits of the rural population of Bangladesh. It is also looking forward to introducing higher yielding foreign varieties into the country. Looking ahead to the future, similar to BRAC Chicken, it hopes to launch ready-to-eat frozen fish products for the urban market. Overall, BRAC Fisheries’ efficiency model and well developed future plans promise even greater success in the coming years.
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A large number of our microfinance clients were investing in cattle, and in doing so were being exposed to risk owing to poor breeding, limited veterinary services, shortages in cow feed and lack of market access. Some of these challenges were addressed through social enterprises such as BRAC artificial insemination and BRAC Feed Mills. Still, the perishable nature of dairy products meant it remained difficult for rural dairy farmers to reach the large urban markets and the demand for milk in a single village was not enough to generate a sustainable profit. Dairy farmers also did not have access to proper refrigeration technologies to store the unsold milk. Sir Fazle Hasan Abed, founder of BRAC, noticed this problem and proposed establishing a milk processing plant to collect milk from local farmers for a fair price. As a result, BRAC initiated BRAC dairy & food project (BDFP) in 1998 to serve as a market conduit for dairy farmers throughout rural Bangladesh.
BDFP’s original mission was to secure market access for dairy farmers, ultimately helping them generate income. Over time, BDFP’s goal has expanded to include serving high quality milk product to their customers. With inconsistent electricity and therefore refrigeration, dairy products generally are not widely available in Bangladesh. 80 per cent of Bangladesh still relies on the ‘informal’ milk market which delivers bulk amounts of raw milk to consumers. BDFP caters to the 20 per cent of Bangladeshis who rely on the formal milk market which sells processed and packaged milk. In essence, BDFP channels milk from rural areas into urban areas while channelling the revenue into rural areas.
Today, BRAC dairy not only secures fair prices for its rural dairy farmers, but has also expanded to offer cattle development and technical training, vaccination, feed cultivation facilities and other services. BRAC dairy was the first dairy company in Bangladesh to have received ISO 22000 Certification, setting an example of vigilance at every stage of dairy production, processing, and distribution contributing to dairy products’ safety record. Through its 101 chilling centres, BRAC dairy collects milk from more than 50,000 registered farmers and sells them nationwide through is under the Aarong dairy brand.
When BDFP first started, it produced 140,000 litres of milk per day. As of now, it has the processing capacity of 250,000 litres of milk per day engaging approximately 1500 employee, making it one of the largest BRAC enterprises.
Empowering rural farmers with reliable storage facilities
BRAC Cold Storage began as a small project in 1980. It set up operations in Comilla in south-eastern Bangladesh because of its easy accessibility by land and water, and started out by giving the farmers loans to use BRAC’s cold storage facilities. The loans cover a maximum of 60 percent of the farmers’ storage costs.
As BRAC Cold Storage allowed these farmers to keep their products fresh for longer, enabling them to sell more of their potato crop over a longer time, many became financially independent and no longer needed loans in order to store their crop, so the project started operating like a profitable enterprise rather than a microfinance programme.
Originally, the enterprise had intended to provide reliable cold storage to fruit and vegetable farmers, as well as traders with leftover produce. However, since fruits and vegetables require very particular, costly preservation processes, BRAC Cold Storage soon limited its storage facility to potato farmers only.
Best practices and quality services
BRAC Cold Storage has for the capacity to store 60,000 bags of potatoes, each bag holding approximately 80 kilogrammes. BRAC Cold Storage is different from other cold storage facilities because of the quality of service it provides. Unlike many competitors, BRAC Cold Storage does not skirt the high diesel costs to properly run the generators for the sufficient cooling of potatoes.
BRAC Cold Storage has plans to further expand its storage facility in Comilla and continue to serve potato farmers
A driving force for the poultry sector growth in Bangladesh
When BRAC's Chicken enterprise became a key local supplier of KFC – one of the world's most popular chicken fast food chains which has more than 11,000 restaurants in over 80 countries; it represented a significant accomplishment for what had started as a grassroots experiment in the 1970s to create income generating opportunities for the poor and improve the poultry sector in Bangladesh. Today BRAC's poultry operations include poultry farms that produce high-yield varieties of day-old chicks, commercial broiler farms that produce adult chickens, a broiler processing plant and a poultry disease diagnostics laboratory.
BRAC Chicken was established to meet the growing demand for ready-to-cook chicken in urban areas. Initially a pioneer of the packaged poultry meat market, BRAC Chicken is now one of major players in the processed meat market. BRAC Chicken also strives to create a market for poultry that provides farmers with a fair price. It started out as a broiler processing enterprise in 2004, with the capacity to process approximately 10,000 chickens per day and was the only automated plant of its kind in Bangladesh. BRAC Chicken has also released a variety of processed chicken products, including chicken nuggets and chicken wings.
Given that the demand for poultry meat and eggs in Bangladesh still exceeds the supply, BRAC's poultry operations continue to be an important means of supporting rural farmers in their production, while also driving sector growth by increasing the supply of high-yield variety chicks and processed broiler meat.
Cross-collaboration to serve across rural and urban communities
A highly integrated enterprise that cross-collaborates with a number of other BRAC enterprises, BRAC Chicken acquires 30-40 percent of its supply from BRAC's commercial broiler farms while the remaining supply comes from other independent farms, both rural and commercial. BRAC Chicken sells the pre-prepared meat to a variety of customers including large restaurants, hotels, supermarkets and even individual households. Some of its major vendors include KFC, Westin Hotels, Radisson Hotels, Best Fried Chicken, and BBQ Bangladesh.
BRAC Poultry Rearing Farms purchase day-old chicks from BRAC Poultry. Instead of then directly selling these day-old chicks to individual farmers, BRAC Poultry sells them to dealers who in turn resell the chicks to farmers who rear the chickens, creating a more cost-effective supply model. BRAC's poultry farms use feed from BRAC Feed Mills. The collaboration among the enterprises, namely BRAC Chicken, BRAC Poultry Rearing Farms, BRAC Poultry and BRAC Feed Mills, creates a value-addition chain which allows BRAC Chicken to sell a high quality processed chicken product at a fair price.
Systematic preventive approach to ensure food safety
BRAC Chicken manages the quality of its chicken along each step of the supply chain: BRAC trains chicken rearers on how to vaccinate their chickens and raise them hygienically, and hires veterinarians to handle more complex health issues. The poultry is always under regular supervision of the vets, particularly during the use of vaccines, medicine, antibiotics, etc. If the chickens are injected with approved antibiotics, a time period of at least 72 hours is given to allow the chemicals to leave their system before processing them. At the end of the processing chain, BRAC Chicken sells high quality chicken, achieving HACCP ('Hazard Analysis and Critical Control Point'; a systematic approach to ensuring food safety) certification. In the process, BRAC Chicken also tries to minimise any production activities that may harm the environment.
With consumers increasingly demanding healthy and convenient food options, BRAC Chicken plans to expand its chicken processing operation and introduce more variety in its product line. As the increased demand for poultry meat has spurred an increase in demand for day-old chicks, BRAC Poultry has scaled up its production to ensure sufficient supply to BRAC Chicken. BRAC’s poultry rearing farms also plan to increase their capacity to serve this growing demand.
BRAC Artificial Insemination began in 1987 as a partnering initiative with the government of Bangladesh to provide the rural poor with an access to better quality breeds of cows. While BRAC provided cattle as assets to the rural poor, the situation was not ideal as these cows could only produce an average of 1.25 litres of milk per day (Survey of BRAC Research Department) and this amount of productivity did not help the target groups generate a decent income. BRAC figured that breeding higher yielding dairy cows would help ameliorate this issue. At this time in history, the government alone had access to high quality bulls frozen semen and the rural poor were seldom capable of administering artificial insemination by those semen. Hence, a joint effort by BRAC and the government workers into the field to train a selected number of people on how to administer artificial insemination gave a head start to the project. Initially, 130 people volunteered to be trained as artificial insemination technicians and till today, BRAC has trained 2,141 artificial insemination technicians successfully. Few are waiting to start their activity in the rural areas.
The government had access to two different kinds of semen: liquid and frozen. They provided liquid semen and the proper insemination equipment to the trained BRAC’s AI workers to inseminate the cows of the dairy farmers but with inconsistent electricity supplies in villages, the liquid only lasted two to three days, which, in a holistic way, deteriorated and limited BRAC’s rural development endeavours. In addition, in 1997, the government’s limited resources for frozen semen caused a huge number of drop outs of the farmers from the programme. In an attempt to tackling the matter, BRAC began producing its own bull frozen semen after taking the government’s permission. To preserve the temperature without electricity, BRAC provided liquid nitrogen to the artificial insemination workers.
Transition into an enterprise
In 1998, BRAC officially split its efforts from the government and worked with various other organisations to support its development efforts. Till 2007 it has a development phase and by 2007, the artificial insemination development programme became self-sufficient and BRAC finally established an independent artificial insemination social enterprise.
BRAC Artificial insemination has one bull station in Shambhugonj, Mymensingh, Bangladesh. When it was first built, it held 35 bulls along with growing. Today it holds 73 bulls and 19 Black Bengal goats BRAC is the pioneer of private owned large sized bull and buck frozen semen collection, processing, preservation and distribution centre in Bangladesh. Till date no government and private organization is involved in goat frozen semen production, processing and distribution. Now-a-days, from the bull station, all types of frozen semen gets distributed to depots. BRAC Artificial Insemination has 70 CCA (depots) throughout Bangladesh. Here, artificial insemination workers purchase semen for average BDT 140. Then they charge the farmers BDT 205-250 for the semen and their services. Artificial insemination workers not only inseminate the farmers’ cows, but they also train the farmers to take care for their cows’ on general health (water supplementation, feeding for proper nutrition, housing and management, disease prevention, and cattle breed selection).
When a farmer’s cow goes into heat, the farmers call an artificial insemination workers and the technician inseminate the cow within 12 to 18 hours for proper conception. Farmers eventually benefit from both male and female calves. High quality breeds of male calves grow more quickly and larger than average male calves, making them a better source of beef. If the cow births a female calf, this calf will eventually grow into a high-yielding cow. For making profitable business on dairying the one calf in one year is essential. AI workers are devoted to informing the farmers in that regards.
Today, BRAC Artificial Insemination covers 61 districts across Bangladesh and has inseminated a total of about 1.64 million in 2015. The districts covered also contribute to BRAC Dairy and Food Project. BRAC Artificial Insemination definitely contributes to the success of BRAC Dairy, helping to fuel the demand for milk in Bangladesh.
BRAC’s AI workers are providing different services, in addition to the AI, the FMD vaccination, mastitis test by CMT kits, fodder seed supply, cattle feed sell, mineral mixture (Minamix) and primary health services through health camps organized by veterinary doctors etc. are continuing in the rural areas.
BRAC Artificial Insemination initially targeted the rural poor, helping them generate income. Today, they focus on a community approach. For example, if milk production increases in a community, the poor can make money rearing cows and selling milk. The rich also benefit from milk and meat products. Today, BRAC Artificial Insemination employs 85 staff. Positions include skilled workers with degrees in Animal Husbandry, Veterinary Science studies, Social Sciences and management. They also employ temporary staff about 40 are working in bull station.
BRAC Artificial Insemination has become extremely successful, surpassing the quality of other artificial insemination services in the country. The general practise in the artificial insemination sector is for farmers to transport their cows to insemination centres, where conception rate averages around 46 per cent. BRAC’s artificial insemination workers actually travel to farmer’s door step to inseminate the cows, and at present their conception rate averages more than 65 percent. BRAC credits their success to the calm state in which they inseminate the cows. When in general practise, receives insemination on cows, they are exhausted from travelling in the hot sun. BRAC has the highest quality bull semen in Bangladesh; this quality paired with high conception rates has drawn more farmers to use BRAC Artificial Insemination’s services.
BRAC Artificial Insemination, as a profitable social enterprise, is constantly working on expansion of artificial insemination services throughout Bangladesh and introducing innovations for dairy development. The profits generated also contributes towards funding BRAC education and health and nutrition programs.
A dairy breeding farm with embryo transplantation facilities is currently in the planning phase. They also plan to increase the bull blood level from 50 percent to 100 percent, creating the highest quality bull possible.
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Empowering crafters in a nutshell
As one of Bangladesh's largest fashion retail chains under the umbrella of one of the world’s largest NGOs, Aarong’s flagship outlet also claims the largest retail space in the country as part of its presence in the Uttara district of Dhaka. Fighting to uphold the dignity of the marginalised, this chic brand began as a humble project. After it’s initiation as a project to provide employment for a limited number of rural women through silk production via sericulture and the art of nakshikantha(embroidered quilts) in 1978, Aarong extended its support to rural artisans by investing in their handicrafts for several years into its operations. In the process, it saw the emergence of independent producers and created income generating opportunities for thousands of artisans from communities beyond the reach of BRAC. Weaving together new opportunities for people with the skilled work of their artisans, Aarong has carved out a unique market segment, giving hope to the crafters.
How it all started
When BRAC started its journey in 1972, the initial goal was to serve as a relief operations committee for a designated amount of time. Once its relief operations were underway, BRAC reasoned that providing limited relief to the rural poor was not a lasting solution for them to overcome poverty, as in the newly sovereign Bangladesh almost everything - including the economic infrastructure of the country - was left upturned. After the completion of its relief operations, BRAC shifted its focus to empowering the poor, forming a long term approach to community development. Around 1976, while operating its targeted group approach, BRAC realised that the most disadvantaged groups in poor rural communities were women, and required a route that would empower this group while also providing income generating opportunities.
BRAC began encouraging silk farming by women in Bangladesh’s Manikganj district. Initially, BRAC had a few scattered buyers in Dhaka, with weeks or even months passing between supply and payment. Today, the process is much more streamlined and efficient as BRAC established Aarong, whose artisans represent the cutting edge of social enterprise. Through BRAC’s innovative approach, the global community now has a prime example of how targeted mobilisation of the poor can support sustainable development efforts, while also generating a financial surplus.
The birth of Aarong
BRAC observed that women in Bangladesh were increasingly involved in agricultural activities. It also recognised that it was the male members of families who marketed the crops and reaped the profits, even though women completed about 75 percent of the agricultural work. In order to create an alternative opportunity to earn an income for these women and contribute to the development of a skilled workforce, BRAC established its sericulture project in 1978 under the leadership of the late Ayesha Abed, former executive assistant director of BRAC.
The sericulture project has supported women in the rural areas of Manikganj in producing high quality silk, and women in rural communities of Jamalpur in producing traditional hand-stitched nakshikantha. However, it soon became apparent that the women producing the silk and nakshikantha did not have sufficient buyers for their products, nor were there any stable platforms for them to market their items. Seeing the opportunity that lay in the challenge, BRAC took the initiative to create a platform so that these women could sell their products to the urban market. Thus, Aarong was launched in 1978, creating a linkage between the rural poor and urban retailers.
Since its inception, Aarong, which means 'village fair' in Bengali, has been working towards BRAC’s mission of poverty alleviation through economic development and human capacity building, with a specific focus on the empowerment of women. The retail process follows several steps: first, a design team conceptualises the season’s motives which are then sent to the rural artisans for production. Aarong continuously develops the artisans’ skills through training programmes, and conducts quality control of the completed items before they are bought at a fair price and then sold across retail outlets in urban markets. By evolving the traditional retail process, Aarong strives to provide a uniquely Bangladeshi lifestyle experience while encouraging social change. A newly generated demand for Bangladeshi handcrafted products illustrates that Aarong has achieved this vision, and continues to challenge the retail industry with its sustainable fashion ‘revolution’.
Continuing the legacy through an extended reach
After the death of Ayesha Abed, her family members founded the Ayesha Abed Foundation (AAF) in 1982 in her honour to continue her projects’ operations. AAF gathers and organises both the skilled and previously untrained artisans from various village organisations across the country and provides them with training and employment; its numerous centres serving as Aarong's production hubs. The foundation currently has 13 centres and 541 sub-centres spread across Bangladesh.
The co-existence of Aarong and the Ayesha Abed Foundation, both geared towards the same ambition, made an extensive support system for artisans all over the country a reality. Through this system, independent producers conducting fair trade with Aarong are encouraged to organise other artisans from their communities, including those communities which BRAC’s services have not yet reached. Today, there are almost 800 independent producers active in different corners of Bangladesh and working with them are nearly 30,000 rural artisans. Additionally, more than 35,000 other artisans are working at AAF centres, producing and selling goods to Aarong to support themselves and their families, resulting in a total of over 320,000 direct and indirect beneficiaries.
BRAC, Aarong, and Ayesha Abed Foundation’s assistance to artisans
AAF's current services to the artisans include free skill-building, supply of raw materials for production, transportation of goods, quality control, storage, management, finance, marketing, and microfinance loan options through Aarong. Working mothers have access to day care centres for their toddlers while they work, and senior workers receive a retirement benefit. AAF employees in rural communities also obtain various support from BRAC, including micro-credit services; seeds, agriculture, poultry, livestock, and fisheries inputs; free schooling for their children; subsidised tube-wells and sanitary latrines; health care including free eye check-ups and glasses, free treatment of tuberculosis and severe illnesses and health education; as well as legal awareness and support.
Currently a health security scheme for artisans and their family members is being piloted to protect artisans against catastrophic health expenditures.
In addition to being trained, women recruited by AAF benefit from a living wage and job security. The workspaces are often right at the doorsteps of the artisans, to enable them to mainly work from home while being able to look after their families.
Taking into account the specific needs of its employees illustrates how Aarong through AAF has always infused a conscious effort to address issues such as the environment, gender-specific needs, safety, security and most importantly - the empowerment of women.
Village fairs in urban landscapes
Aarong’s primary customers are mostly from middle and higher socio-economic classes living in urban areas.Aarong’s retail outlet is particularly renowned amongst expatriates and foreign visitors. Today, Aarong owns 15 retail chain outlets in Bangladesh, nine of which are in Dhaka, two in Chittagong, one in Sylhet, one in Narayanganj, one in Khulna, and one in Comilla. Not only has Aarong been a trendsetter in the local fashion industry, with the Uttara flagship store claiming the title of the largest retail outlet of a single brand, but it is also a pioneer of its kind in entering the global market, having opened a franchised outlet in London in 2001, and planning the extension of its e-commerce website to international markets in the near future. Aarong offers a wide variety of products and designs in its outlets including embroidery, block and screen prints, tie-dyes, vegetable dyes, batik, block cuttings, furniture, wall mats, toys, pottery, metal works, jewellery, leather products, candles, handmade paper and paper products.
Merchant of a lifestyle in favour of the environment and sustainable development
Aside from its significant contribution to the expansion and popularisation of the cotton handloom industry, Aarong has given rise to a greater demand for locally manufactured fabrics, which in turn has played a vital role in reviving the almost extinct traditional jamdani (woven cotton fabric), muslin (loosely woven cloth) and nakshikantha. Committed to being environmentally friendly, Aarong has also introduced dyes free from AZO (restricted aromatic which may be harmful to skin) and PCP (used for chlorination, also deemed harmful) in its cotton fabric production.
In addition to redistributing 50 percent of its profits throughout BRAC’s development programmes (keeping the remaining 50 percent to sustain its own operations)Aarong’s own consumption of raw materials sustains numerous artisan communities in Bangladesh; Aarong buys 75 percent of cotton produced in Madhobdi, the core cotton production area in Bangladesh, and over 70 percent of silk produced in Maldaha.
Aarong started out with the goal of supporting poverty stricken rural women so that they could empower themselves by utilising and further enhancing their skills. That goal remains to this day, with its scope having broadened to extend its services to more of the rural poor and urban markets. Aarong plans to launch an international e-commerce site to serve global markets and is looking to expand to more cities domestically and internationally.
1978 – Opened its first retail outlet in Dhaka, Bangladesh
1982 – Established the Ayesha Abed Foundation, a network of production centres
1983 – Opened a retail outlet in Chittagong, Bangladesh
1985 – Opened a retail outlet in Sylhet, Bangladesh
1987 – Entered the export market
1995 – Opened a retail outlet in Khulna, Bangladesh
1999 – Participated in its first international fashion show
2001 – Launched a retail franchise in London, United Kingdom
2003 – Launched its sub-brand ‘Taaga’, women’s western fusion wear
2007 – Received Fair Trade certification from World Fair Trade Organisation
2008 – Celebrated its 30thanniversary with an exhibition series and fashion gala
2009 – Received ‘Best Brand’ award from Superbrands
2011 – Opened its flagship outlet in Uttara, Dhaka, Bangladesh
2012 – Opened a retail outlet in Comilla, Bangladesh, received UNESCO Award of Excellence
2013 – Launch the Artisan Development Initiative, a BRAC holistic development programme
2014 – Opened a retail outlet in Jamuna Future Park, Dhaka, Bangladesh, launched e-commerce website, launched furniture line ‘Rattan’ and product line ‘Maternity Taaga’
2015 –Opened retails outlets in Dhanmondi and Banani, Dhaka, Bangladesh
In 1978, BRAC’s flagship social enterprise, Aarong, was created as a support mechanism to BRAC’s existing sericulture programme so that the hand-spun silk they were creating could be successfully marketed at a larger scale. Aarong was established as a retail distribution outlet that offered a fair price to the rural suppliers while introducing the products to urban markets where both demand and consumers’ willingness to pay were the highest. Today, Aarong has transformed into a high surplus generating enterprise, operating as one of the largest retailers in Bangladesh. Other BRAC enterprises also came into existence at various times in similar efforts to create economic space for the poor. Although most of the BRAC enterprises were formed as programme support enterprises, majority of them currently operate as surplus generating ventures while maintaining their ongoing commitment toward alleviation of poverty via empowerment of the poor. Today BRAC operates 16 financially and socially profitable enterprises, across health, agriculture, livestock, fisheries, education, green energy and retail sectors, making significant contribution to local economy through creation of market linkages, entrepreneurs and employment opportunities. By targeting profitable and scalable businesses, BRAC enterprises are able to fullfill their social missions at a much greater scale while increasing financial surplus that reduce the organisation’s donor dependency and support BRAC’s development programmes and other innovations at a greater level. That is why BRAC enterprises continue to exist, expand and innovate through across multiple sectors.
The BRAC ethos of social entrepreneurship, the '3Ps': people, planet, profit
BRAC Enterprises strive to strike the right balance between financial surplus and social returns in order to achieve the targeted double/triple bottom lines. By operating as a surplus generating organisation that aims to alleviate poverty through its business operations and supply chain, BRAC succeeds in implementing its vision to serve society in a profitable manner.
Although all of the BRAC enterprises are committed toward achieving financial, social and environmental returns, BRAC takes a unique approach in defining its triple bottom line by focusing on three ideals: people, profit and the planet (the '3Ps'). A BRAC enterprise must meet three criteria in order to be considered a successful and sustainable business:
It must serve the needs of poor people
It must be environmentally friendly, and
It must make surplus to help keep BRAC’s development works sustainable
Social enterprise – our objective
BRAC takes a holistic approach in conceptualising and developing each of its enterprises. As BRAC enterprises have expanded from programme support mechanisms to surplus generating enterprises with financial and social missions, each enterprise has ensured that it complies the four fundamental objectives of a BRAC enterprise:
Creating job opportunities
Generating surplus for BRAC in order to minimise donor dependency
Ensuring long-term support and contribution toward the sustainability of BRAC’s development interventions such as microfinance, education and skills development etc.
Becoming viable investments in the long run in order to act as ‘hedge’ against future liquidity
Advantages gained from social enterprises
Through its unique model and integrated operations, BRAC achieves five distinctive advantages across its enterprises:
The integrated network of BRAC Enterprises, Development Programmes and Investments together beget a unique synergy and essentially create a 2 2=5 Effect. The surpluses generated by the social enterprises make BRAC more self-sustaining so that increasing numbers of poor people can become self-reliant.
BRAC enterprises maximise synergy, impact and value by their targeted outreach and integrative products and services across multiple enterprises.
Although BRAC enterprises aim for financial returns while fulfilling the social and environmental missions, not all enterprises are equally profitable. The cumulative surplus from BRAC enterprises combined are used to re-invest in the BRAC enterprises and support the development programmes, on an as needed basis, not on a pro-rata basis across enterprises.
BRAC’s extensive network of enterprises with the capacity to address major social needs allows BRAC to continually identify needs and create innovative solution to fulfil that need and create necessary market linkages.
Because of its integrated network and unique model, BRAC has the advantage, ability and capacity to provide holistic support and truly take care of its stakeholders, i.e. the entrepreneurs involved with the BRAC enterprises.