The Heat Wave – Raghunathan (FT13459)

It was a very hot day… Well, after being here for the large part of my life, I know that it is not a rare phenomenon in Chennai…  I was returning to the college with a lot of thoughts in my mind. It was so hot and upon seeing me sweating, Lord Shiva checked if he is the only person to have a river originating from his head. To quench my thirst, I approached a nearby road side person selling tender coconuts. The first sip was so electrifying that a light bulb sparked in my head and the idea for my individual project flashed in front of my eyes.

 This thought having crossed my mind, I just started a friendly chat with the shop keeper on his sales and marketing strategies. The first thing that crossed my mind was to ask him on the sales prices of the tender coconuts. Soon, I could find from him the rates at which the coconuts are being brought in from the “Producers” to the “Consumers”.  I understood that it was a Producer > Distributer > wholesaler > retailer chain.

Who	CP(INR)	SP (INR)	Margin	Margin as a percentage of sales
Distributor	7.5	15	7.5	50.00%
Wholesaler	15	24*	9	37.50%
Retailer in heart of Chennai	24	33+	9	27.27%

^*the SP of wholesaler is 22 Rupees in winter and 26 Rupees in summer

⁺ The SP of retailer is 30 Rupees in winter and 35 Rupees in summer

Upon knowing this, I became a lot more curious. I asked him, from where I was getting the coconuts. As soon as, I asked this, he looked at me and asked with a laughter that, “Are you planning to start a competition against me here?” This is when I revealed to him that I was gather data for an assignment for a project in my college. With laughter and more crowds surrounding us, our conversation restarted. Yes, I made him the professor for about 15 minutes and he eyes swelled with pride that his business model was actually “Going Places!”

He then told us that the tender coconut is imported from a place called Erode which is about 400Kms from Chennai. There in it is brought to Chennai in trucks and where it is being distributed. He also told that in a hot summer day, he sells around 150 coconuts; each fetching a margin of about 27%. Epiphany, as they call struck me.  The reality of the words of Sri T N Seshan in an article shared by Prof T.N Swaminathan came across my eyes. It said - ‘A paanwala will earn more than what you earn.’  And here I was talking to one who made around 40k per month (more than my last job’s salary) without any proper education/b school training/roof to call as a shop.

On returning to the college, I remembered the business model that Cane-O-la created in sugarcane selling business. I wondered what if this is done to tender coconuts. I found many companies that are currently packaging coconut water.  A work for my next survey… thought I…  J