Khadi spins strategy to be FMCG player -- To set up marketing company  ( August '2,2001, HBL)

KHADI and Village Industries Commission (KVIC) has set the ball rolling to achieve its goal of becoming the largest fast moving consumer goods (FMCG) player in the country.

To begin with, KVIC will set up a marketing company by October this year, the KVIC Chairman, Dr Mahesh Sharma, told a press conference here on Wednesday.

Dr Sharma said discussions for setting up the company were in the final stages, adding that in all probability, the company will be based in Mumbai. ``The setting up of the company is aimed at capturing the local market and furthering exports,---- Dr Sharma said.

Officials said the assets of KVICs Directorate of Marketing were likely to be transferred to the new company. The marketing company is also expected to receive financial assistance from the Government.

Meanwhile, Dr Sharma said khadi products had been segregated into two brands _ Sarvodaya, aimed at the mass market, and Khadi, for the export market and the premium domestic market.

Officials said the Sarvodaya brand will comprise toilet soap, honey, pickle, spices and agarbatti.

KVIC is expecting sales to touch Rs 10,500 crore during 2001-02, against the Rs 8,000 crore, it logged during 2000-01. Dr Sharma said the production of Khadi goods is expected to be worth Rs 8,600 crore during 2001-02 _ up from Rs 7,211.57 crore the previous year.

Direct exports from the sector have also increased to Rs 29.65 crore during 1999-2000 _ up from Rs 24.68 crore during 1998-99. Dr Sharma said the volume of direct exports will be a ``lot more---- if KVIC was given the status of an Export Promotion Council.

Furthermore, KVIC has allocated Rs 35 crore this year for renovation of its sales outlets. In the first phase, Khadi Gramodyog Bhavans in Delhi, Kolkata, Ernakulam and Goa will be promoting the concept of exclusive showrooms to cater to upmarket consumers and adhere to fashion trends.

Besides, KVIC will focus on the bio-technology sector, specially on bio-fertilisers and bio-pesticides. Dr Sharma said this will lead to the availability of organic food products through the KVIC chain, besides having a multiplier effect on the sector.

The United Nations Development Programme (UNDP) is also providing financial support of about Rs 12 crore to strengthen artisan clusters of pottery, handmade paper and bee-keeping, besides beefing up the resource centres and capacity building for marketing initiatives.