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Ethnographic Analysis of the Casual Sector

INTRODUCTION

The informal sector will be grasped through an exercise of advertising of paper clips as street vendors for an interval of seven days. Paper videos are a stationery item used for binding documents together and are used by students, office buildings, lawyers, and federal officials between others. However today, the option of substitutes like staplers (a creation of technology) has challenged the power of the commodity. The informal sector is that area of the economy which is not taxed, watched by any form of federal government or contained in any gross nationwide product (GNP), unlike the formal current economic climate. In 1997-98, the informal economy generated almost 76% of employment and practically 46% of the income in Mumbai. Despite their physical lifestyle and the thousands involved in it, for sheer success, their 'formal' 'invisibility' makes them ineligible for some statutorily ordained benefits and allowances.

PREPARATORY STAGE

A pre-sales activity was conducted to understand the potential concentrate on group. The connections revealed that most consumers don't have a requirement for the product, as staplers are a far more reliable paper binding solution. The pre-sales research disclosed that paper clips are sold in quantities of 100 videos a box. Predicated on the conclusions, a sales model originated wherein the bulk of 100 videos would be resold 10-12 videos in plastic pouches. This would allow people to purchase small quantities and also convenient advertising.

The model followed is comparable to wholesaler-retailer supply string model wherein the store makes bulk buys from a wholesaler and provides smaller volumes to the customer. A similar model is employed by street suppliers who buy in bulk and retail smaller quantities. A cost-plus charges strategy was adopted and a profit percentage of 200-300% was agreed upon, which would be reduced through the span of the exercise until enough capital was gathered. Furthermore to repacking, a packaging strategy was adopted. Zip lock plastics would be utilized to offer the paper videos, in so doing adding value to the item.

Purchases of both the newspaper and the packaging material were made from the low cost market in Abdul Rahman Block, Crawford Market where stationery is handled in wholesale volumes. Due to capital constraints, stock cannot be purchased in volume, restricting our bargaining ability. It was determined that any earnings incurred on the first day, would be ploughed-back to maintain a much better inventory status. Locations selected for advertising activity contains areas frequented by office goers, students and children. The target collection for the selling exercise was to cover costs and make gains by adopting a sales maximization way by using strategies like customization, price discrimination, bundling, advertising, and market segmentation.

EXECUTION STAGE

Due to dearth of capital on the first day of our own study, a sufficient stock of newspaper videos was purchased but did not enable purchase of presentation materials. Waste product packaging materials from the roads of Crawford Market was used as an alternative for the 'zip lock pouches'. An enormous profit margin was targeted on the first day that would generate capital to fund better quality packaging for the remaining days.

The entire experience above the 7-day period is illustrated in the table below (refer Appendix I).

Day

Location

Rationale for Location

Experience

Day 1

Fort, Outdoor Bombay High Court

Potential Potential buyers: legal professionals and office goers.

Problem arose because people coming back home from work and lunch break didn't stop to indulge

Prices were very high so sales were gradual.

Selling on the wrong side of the road and modified position to focus on people going on the station.

Day 2

HR, Jai Hind and KC

College.

Potential Purchasers: Students, who have electricity for stationery, especially females using customization and superior packaging materials.

Customization and product bundling proved to be quite effective.

-The coloured and fancy paper clips were sold out, despite higher price

Zip locks used resulted in quick sales

Right time for sales (1pm onwards) when most students were finished with their lectures.

Day 3

Street Vendor Fair, External St. Michael's Chapel, Mahim

To research the variation in the sales of the item on a standard day in comparison to 'special occasions'

Relatively better to sell throughout a 'reasonable' or during special occasions

People are more prepared to buy when subjected to multiple goods within confirmed space.

Day 4

Marine Drive

To understand variation sales in a tourist and recreational spot

The price was decreased as a more substantial stock was procured due to earnings from the previous day

Concentrated on sales advertising strategies by giving off free systems to females who purchased packets

Strategy was successful (word-of-mouth marketing performed a significant role)

Day 5

Trains, Central Series - CST to Dadar (Go back)

To understand the deviation sales in a setting of transport

The female partner made large sales in the girls compartment of the while the other spouse was unsuccessful in the overall.

Women are usually more approachable on trains which is often attributed to the large number of retailers in the women's compartments on trains

Buying behavior exhibited by women is mainly an result of 'novelty value' of the products being sold

Day 6

Marine Lines Station

To sell amidst other street vendors and understand the dynamics of neighborhood vending.

Holding up a banner to 'advertise' the merchandise didn't work in the informal sector

Other experienced distributors arrived and interacted with us, passed comments and also ridiculed us. They moved away after they didn't see a threat with their business

Interaction with sellers: On requesting about the 'hafta' to be paid, they refused to talk with and changed away An unsuccessful sales as it was a Sunday.

Interaction with regulators: A BMC vehicle emerged to evict the distributors, confiscating their products, politely asked us to move

Day 7

Republic Day Parade, Marine Drive

To know how national holidays impact on sales in the informal sector

Stood beside a flag seller considering people might need clips to put on the flags.

No sales took place as people were engaged in observing the Parade

EVALUATION STAGE

Theory versus reality

On participating with the marketplace on a first hands basis, we came across the following monetary concepts while studying various sales strategies to take full advantage of our sales to keep earning a profit. :-

Monopoly firm: - Since we were the one sellers of this product on the avenues, we had the liberty to utilize price discrimination along with product differentiation. We gauged our goals and regarding to their outlooks and then made the decision the price to demand them.

Price discrimination:-the same products were sold at different prices in various places to different consumers. First level and third level price discrimination was used. Under this the firm recharged different prices to different group of consumers. For instance while reselling in the High Court premises; we sold the tiny amount at Rs. 20 a packet to legal representatives while we sold the packet to women in trains at Rs. 5. Within the former case, the whole consumer surplus was changed into the firm's earnings and profits. The idea of third level price discrimination was used here where communities having inelastic demand (attorneys/office goers) were costed an increased price set alongside the ladies in trains who possessed elastic demand for whom the price was comparatively lower. The theory of price discrimination did not work for us as instead of playing with consumer surplus to make income, we finished up just covering costs per day, neither did it minimize our costs nor did it increase output. In addition the test of just seven days was too brief to judge this concept. However, regulations of demand was justified wherein there is more demand when there is reduction in price. The elasticity was 1. 0195 which is relatively elastic. However, from the discussion in the market we found out that it's inconsequential and therefore, nullified. (Refer Appendix II)

Product Bundling: - The firm offered several products for sale as one merged product. It is one common feature in many imperfectly competitive product marketplaces. The organization used the approach of bundling to produce more demand and take the marketplace. For example- rather than reselling big metallic binders, metallic U- clips, coloured U-clips and elegant clips independently we bundled them alongside one another and sold them as a packed deal at Rs. 20 concentrating on the college students. This concept worked for us.

Sales maximization: - was arranged as you can goal which occurs when the company sells as much as possible without making a reduction. We implied this strategy wherein we after a spot where we had protected all our costs, we focused on selling just as much as we can even if it's at a low profit margin as long as there is no damage. This helped us in gaining our income and capital for next days. Thus, the application of this theory was successful. We also came to the conclusion that paper videos as such are not a commodity that a street merchant would sell. It is more likely found in stationery retailers as they provide market which requires all these goods.

Lessons Learnt:

Operating in the informal economy showed us that there existsno perfect knowledgewith admiration to commodities for sale (in terms of supply and price). Venturing further in to the roadways of Crawford Market uncovered that the item sold is a lot cheaper when compared to the peripheral retailers. The procurement exercise highlighted the prevalence ofinformation asymmetry.

The existence of street sellers is a menace for commuters but a benefit for the working poor by giving goods (sometimes essentials) at a significantly cheaper price. The study revealed that most street distributors require credit in order to begin an enterprise but were often refused access as a consequence to insufficient collateral however they haven't requested any loans due to a variety of reasons. They are not well aware of the government insurance policies and are put through regular evictions by the municipal businesses as we detected when the road vendors were designed to flee the picture when the BMC pick up truck arrived at Marine Lines station during our study. An important aspect is the self-employment, which can be an important component of the casual sector which allows this portion of the urban poor to earn money but is also grouped into different types of employment like employees, middlemen, and unpaid members of the family or self-employed. Thus, the casual sector functions a livelihood-sustaining program.

Interactions with block suppliers, it was found out that they suffer from problems like hypertension, hyperacidity migraine problems and severe backaches. Another aspect discovered was the involvement of women. Women form a significant percentage of the casual work force. (Refer Appendix III for Survey Questionnaire and Appendix IV for results/studies).

Policies set up:

-The National Insurance plan for Urban Road Vendors, 2004 was the first insurance policy that called hawkers as "vendors" in selected areas called hawker areas and non-hawker zones and to ensure lack of congestion and maintain hygiene in public areas spaces and roads.

-Policy of Property and Urban Poverty Alleviation, 2009: With the National Commission payment on enterprises in the unorganized sector, this costs has not been introduced so far. It generally does not focus on natural marketplaces like railway stations, depots, taxi stands, etc. Heavy fines are levied on unregistered vendors and their goods are confiscated. Non perishables are left off with heavy fines; however, berries and vegetable vendors lose everything. The "Panchnama" of confiscated goods is not issues by policemen and documents are not looked after.

-National Insurance policy on Urban Block Suppliers, 2009: It accounts the conditions of work and advertising of livelihoods in the unorganized sector. It offers a constitutional perspective to practice any occupation. For example: Right to adequate means of livelihood, Article 14, 19 (1) (g), 38(2), 39(a) and 41.

Suggestions:-

Registration must be made compulsory for block distributors by issuing licenses to prevent illegal lease seeking activities in the form of "haftas" from officials and thus, providing them with acknowledgement. Incentive to join up can be provided to street suppliers by giving subsidized healthcare to authorized vendors. Cheap property and accommodation or slum rehabilitation can be provided to register street suppliers as almost all of them are migrants from from coast to coast. A mechanism to record a PIL must be proven for the road vendors to seek redressal for confiscated goods. Alternate spaces should be allotted for his or her activities if the region should be cleared of such activities. For example, the move of Agra Market through the 2010 Commonwealth Games. Stricter regulations and there enforcement is essential so that illegal hawking is averted and they do not seem a nuisance to the commuters. In this manner, both elements of the society can stay in harmony.

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