Change Agent Venture Fund

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Inclusive Capitalism Community Owned Companies
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• Fabindia Overseas Private Limited
• Established in1960 as an export house
• Linking traditional, craft-based rural producers
  to modern urban markets and consumers
• Indias largest private retail platform for
  products that derive from traditional techniques,
  skills and processes
• Twin Mandate
• A viable, profitable retail platform for
  products created using craft skills and processes
• The creation of skilled, craft-based sustainable
  jobs in the rural sector

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Snapshot Fabindia Market Product Profile

• Market Distribution
• 97 stores across 42 cities
• 6 stores abroad and a growing presence in the
  Middle East
• B2C online Exports to 34 countries
• Product Range
• Garments
• Indian and western styles for men, women,
  children and infants
• Home
• Home linen - bed, bath and table gift items,
  floor covering, lighting
• Furniture
• Contemporary wood furniture for homes and offices
  
• Personal Care
• Soaps, face, skin and hair care products using
  authentic natural ingredients
• Organic Foods
• Organic and natural agri-products grown without
  chemicals or pesticides, and processed foods
• Jewellery
• Showcasing craft repository of skill and
  technique

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VISION

• Create a pathway for the growth of Indian textile
  and non textile craft products in the
  international and domestic market
• Focus on indigenous and inherent skills
• Reach out to 100,000 artisans in rural India to
  provide an opportunity for inclusive growth

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HOW?

• By creating
• a relevant intermediary organization
• with defined responsibilities which will support
  the vision.

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HENCE

• Establishing of a joint investment fund
  Fabindias subsidiary Artisans Micro Finance Pvt
  Ltd (AMFPL), as an NBFC
• Facilitating the setting up of the Community
  owned Companies (CoCs) as first Private, and then
  Public Limited Companies 17 COCs are fully
  operational

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• Corporatising the Supply Chain
• Goal to create 100,000 sustainable rural jobs
  across India
• Enabling access to working capital the main
  hurdle to capacity building
• Closer to sourcing shortening the supply chain,
  better quality and pricing
• Direct interface with artisans

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AMFPL Strengths

• Highly qualified, experienced and dedicated Board
  
• Captive access to the market via Fabindia
• Access to working capital and term loan funding
  via tie up with Banks

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AMFPL Structure
Fabindia Overseas (99 equity)
Working Directors (1 equity)
Artisans Micro Finance Private Limited- NBFC
Working Directors
Fabindia Rep. MD
Independent Directors
Maximum AMFPL Equity in COC 49 . Minimum equity
26
COC
COC
COC
COC
COC
COC
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• Role of AMFPL
• Survey and Feasibility Study of Craft Clusters
• Setting up a COC
• Selecting and Training Management Team
• Establishing Standard Operating Procedures
• Assisting to establish quality standards
• Financial and Business Planning
• Provide access to funding from banks
• Vetting and processing loan applications
• Monitoring loan disbursal
• Ensuring repayment of principal and interest

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Role of AMFPL

• Raising equity
• Commitment to a minimum 26 equity in all COCs.
• Raising balance equity for the COCs
• Artisan shareholding
• External Investor
• Providing access to market through Fabindia
• Co-ordinate technology and design inputs, and
  product development
• Constant monitoring of operations and
  profitability of CoCs
• Wealth creation for share-holders

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• Community owned Companies (CoC)
• Empowering the Supply Chain
• Strengthening supply capabilities where the goods
  are produced
• Implementing common systems for stocking,
  production and delivery
• Ensuring that the profits of the CoC are ploughed
  back into the business
• Allowing artisans to avail facilities set up with
  common investment for processes that improve
  quality and add value
• Facilitating the training of artisans
• Enabling the purchase of materials in bulk so as
  to get the best price

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Community owned Companies (CoC) - Shareholding
Pattern
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COCs Incorporated under The Companies Act, 1956

• COC Board Structure
• Artisan Director
• Key staff members of the COC who are working
  Directors
• Independent directors
• AMFPL representative

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COC Management Team

• Levels of COC dependant on turnover value
• Key Positions in COC vary from 1 3
• Secondary Positions vary from 2 6
• Flexibility in appointment of management team
  basis relative strengths weaknesses

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COC Management Team responsibilities

• Operational profitability of the company
• Meeting sales and profit targets
• Product Development
• Maintaining adequate stocks to meet orders
• Order Fulfillment within timelines
• Managing supplier relationships
• Generate artisan shareholding
• Conducting Board Meetings AGMs

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COC - creation benefits

• Pooling of artisans resources
• Resulting in economies of scale
• Access to technology and facilities
• Revival of dying crafts
• Improvement in quality
• Access to design inputs
• Possibility of Indian craft being competitive in
  the global market

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COCs - as Private / Public Ltd. Companies

• Creation of first time artisan ownership in a
  company with control over their business
• Wealth creation in the form of increased value
  investments in COCs
• Increased employment opportunities in rural India

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COCs as Private / Public Ltd. Companies

• Artisans participate in decision making of the
  company
• Receive dividends
• Share trading window permits easy entry and
  withdrawal

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• The Fabindia Supply Chain As it Evolved
• Move from centralised model to regional supplier
  companies
• Long-standing, personalised relationships with
  suppliers that go back a generation
• Consistent growth of artisan suppliers linked
  exclusively to Fabindia
• Complete geographic coverage of crafts and supply
  chain through the 17 COCs

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The Supply Chain Structure
Fabindia Stores
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Community Owned Companies a Snapshot