41: A conversation with Sumita Ghose, Founder Rangsutra on building a sustainable social enterprise

Shownotes: 

Sumita Ghose my guest on this episode of The Elephant in the Room podcast is the founder of Rangsutra - a social enterprise working with artisans in rural India. A Fulbright Scholar and the recipient of the MacArthur Fellowship for Leadership, Ghose set up Rangsutra with a goal of bringing about socio-economic development and inclusive growth to rural India by engaging both the community and market. 

But, the venture almost didn't take off because a leading public sector bank refused to give her a loan since she did not have collateral. A determined Sumita raised the seed funding from a 1000 artisans who she had worked with in the past. Today, Rangsutra is co-owned by 2000 artisan shareholders along with Ghose, Social Venture Capital Fund Aavishkaar and Fab India's Artisans Microfinance. 

Sumita's ambition for Rangsutra is to be a global brand but also to show the world that there is a way of doing business, which is good for all. In India the partnership with FAB India and IKEA who have a similar value system has helped Rangsutra to grow from strength to strength. 

Listen to her Sumita speak about her journey. 

👇🏾👇🏾👇🏾

"I swear by the waves of the sea and seashore, that we will change the warp and the weft of society. And this change can only happen if it begins with you. You have to be the change you want to see the world and the world will change accordingly". This song by Kamla Bhasin, developmental feminist activist and poet is the inspiration for these women artisans engaged in bettering their lives. 

Memorable Passages from the episode

👉🏾 Thank you, Sudha for having me happy to be here. 

👉🏾 So I grew up in Bombay and went to school and college there. And while growing up there, one of the good things that I experienced right from school was that there was the sense of you can do anything you want. Because there are so many opportunities, there are so many role models of people that you can emulate unlike a small place. So I was always interested in crafts, I learned from my mother to stitch clothes because being a Bengali every Pooja we used to get three sets of clothes, and my mother would stitch those clothes for me till I was about 15 years.

👉🏾 But when it came to deciding about college I sort of chickened out from focusing on this and I decided to go in to study science. But in college a year of laboratories and chemicals just put me off totally and I switched to the humanities focusing on economics but I must say I wasn't clear about what to do even at college. And then after I finished my last paper  in Economics, I came back home and I told my friend I just cannot study anymore.

I need to work. Of course who's going to give work to an economics graduate I mean, there are millions of economics graduates. But a friend of mine came across a post for a sales person in a store called 'Artistic' and which made and sold the most beautiful products, mostly handcrafted products. 

And I applied there and I got a job and for two years, it gave me an idea of the amazing craft heritage that we have whether it's in woodcraft, metal craft, semiprecious stuff and Pichwais. There was a little workshop where some of these products were made, specially handbags. And I realised that the people who were making it were really not getting a good deal. They had the skills, but they obviously were living a hand to mouth existence. And of course, growing up in Bombay you know how it is Sudha you've lived in Bombay I think.

👉🏾 As an adult you are very conscious of the inequalities in our society.

So that stayed with me, of course, I didn't know what to do with it, but I was conscious of it. It was in college where I met my future husband, he wanted to do something, to bring about a change. And he opted for a subject called rural development, which was offered for the first time in Bombay University and there were only two students who took it. So through him, I got to know a little bit of the challenges that rural India faces. And then of course I finished working in Artistic. Then I said, I must do a Masters in Economics, and I really enjoyed the Masters in Economics.

👉🏾 And at that time Sanjoy he was studying at the Institute of management in Anand and after that we decided to get married, and I must say that 70% of what attracted me to him was his unusual choice of career or profession. So, that started a new phase of my life. 

👉🏾 So as I said, I embarked on another journey and went and lived in Rural Rajasthan for 10 years. And it was another country. And while there it was very clear that the position of women, the status of women was very poor, there was a lack of opportunity that women and girls and boys also had in terms of education and health. But they have this amazing craft skills and also knowledge of traditional agriculture, organic agriculture. So that always stayed in my head as a part of something to focus on and to bring to the world. Normally people see rural Indians as backward and they need to be developed and they need to be empowered, but there's something that they could also give to us. So this stayed in my mind 

👉🏾 And then I left Rajasthan. Sanjoy and I both went to work in Assam, where we had a very bad experience and basically it was, we got into confrontation with the ULFA and they abducted Sanjoy and we had to leave the place, me and my children and my other colleagues. And it was obviously a turning point and it made me question a lot of things because it made me question. The model of rural development that we are following, is that the way out or do we need to do something which is a little bit more owned by the people? You know, where we look at people, not as beneficiaries of our projects, but whatever we want to do, we do it in a way, which is co-owned and where there is active participation and ownership.

👉🏾 So after this terrible period in my life, I got a chance to go to the United States on a Fulbright fellowship, doing a Master's in conflict transformation. And it was a time which really gave me an opportunity to step back. I was going back to college after like 20 years almost, I was just about 40 then and that was a great time and I was actually writing a paper on for this master's degree 'on organisations needed for the 21st century with a focus keeping conflict at the back in perspective. So one of the conflicts I decided to focus on was really the growing inequalities amongst Indians, specially in the light of opening up of our economy after 1991. People like me, us, who have had education, have had so many opportunities open to us because of globalisation.

👉🏾 But the people I had worked with in rural India were struggling just to stay in that place. So I felt that this was a potential for a source of conflict and what can we do? And so that's when I thought of the idea of Rangsutra, the name hadn't come to my mind, but I thought of it as a space. A platform, if you call it or a space, in which we can get people from different parts of the spectrum - like I chose craft, so people who make the craft, people who design them, people who sell them, the retailers. Why don't we get them all together and create a space where each one can see the importance of the other, understand each other and use this space to create an organisation, not just to sell products, but also to ensure sustainable livelihoods for rural artisans.

👉🏾 Yeah, so setting up Rangsutra, we registered a company, by we I mean the artisans had worked with before and some team members, because we decided that it has to be for profit. So we registered a company, but that's easier said than done after registering a company, we couldn't really raise the funds to run it. Because we didn't have a three-year balance sheet, none of us had collateral. So what I did was go back to all the artisans I had worked with in my life in Rajasthan, asked them if they were willing to chip in money and I was very concerned that they would say no. But, they actually bought the idea and a thousand of them put in a thousand rupees each. 80% of them were women, that's 800. And we got 10 Lakhs, which was our first equity. So, I would say real ownership of all the stakeholders is something which is the bedrock of our model. With that kind of a mindset then each one of us will do our best, whether it's the designer creating the product, whether it's the artisan doing the embroidery because she knows if she doesn't do it well, it will not sell. So, that's one main thing the ownership. 

👉🏾 The second thing that I would say is very important is that, earlier, all these artisans were working from home. Home-based workers for various reasons, it's simpler for women especially to work from home, there were no public spaces in villages in which they could call an office. But, we decided after a while, and this was when we had started our partnership with IKEA actually, that we should get them to come to centres and work together so that they can learn and grow together. At Rangsutra we believe in co-ownership, co-creation, we create the new designs with our designers and artisans work together of course, with the market mind. We get the orders, we buy the raw materials so that the quality of the raw materials is good. We help the production planning. Each village has someone called a craft manager, who we've trained and she knows the craft, but she also shows leadership quality and so she sort of supervisors the rest and we take the product right up to market. 

👉🏾 So actually, I knew FabIndia and the owner of Fabindia, William Bissell, right from my Rajasthan days, when we helped Fabindia to set up a school for their artisans in another project of Rajasthan. And then subsequently because we were working with weavers , we had some experience of supplying to Fabindia but it was very shaky, I mean we'd get one order for the next two years. So when we started Rangsutra, William Bissell was one of the people that I was talking with right from the beginning. And not only are they our retail partner, they have also invested in the company so that we can have the resources we need to grow.

👉🏾 And with Fabindia again it's a partnership. It's not just a transaction of a supplier/vendor. But it's a partnership where we have learned a lot from things like standardisation of products, we learned about running a business actually. How do we ensure that we have enough raw material, enough inventory, not too much, not too little and the basics of making a profit and loss statement every month, how to run a successful enterprise at a village level, district level.

👉🏾 So the IKEA partnership came about six years after we started Rangsutra, Where I was a little restless, I have this tendency to be restless every five years. So I was a little restless that, you know, what else is there? Because we can't just be making shirts and kurtas. So in that search I came across a project which was funded by the IKEA Foundation, on women's economic empowerment in Eastern UP. And it was in Varanasi, a city which I had never been to but had heard a lot. It's supposedly the oldest living city in the world. And so I was drawn to Varanasi, I went there, we got the project and that's how we started. And it was the development project, in the sense that we actually helped train the women to learn the craft, to manage their work and then when the project got over after two years, I told my IKEA colleagues that, look you can't let us go now, you're the biggest retailer in the world, give us a chance. And, I must say they were very open to it, and they started a new project, it was a project then now it's part of mainstream business. It was to work with what they call next-generation social entrepreneurs. So business not just for profit but for empowerment of the people who are engaged in it.

👉🏾 And that partnership again has taught us so much, we couldn't believe that from a small place like Mirzapur or Gyanpur in Eastern UP, that you could make products to sell globally. And that gave us a lot of confidence, IKEA has been amazing. They have helped us, literally the ABC of export business and making textiles for the world, we learned from them. And touch wood the partnership grows from strength to strength. 

👉🏾 Yeah, so, it's a group of women who are singing this song which says that "I swear by the waves of the sea, that we will change the warp and the weft of society. And this change can only happen if it begins with you. You have to be the change you want to see the world and the world will change accordingly". It's a song actually written by lady called Kamla Bhasin, she is someone I've learned so much from and Jagori. In my early days I went to workshops there and we learnt the song there.

👉🏾 You're absolutely right, It is a risk being so dependent on two large buyers. So what we have done is we have started diversification and from next month, actually, we'll be working in a bamboo cluster in Jharkhand. So you know natural fibres is the next vertical we get on to.

👉🏾 And definitely looking for other global buyers who have the similar kind of orientation, like Fabindia and IKEA have in the sense that it's not just about the product, but also the people who make the product. And so we are trying hard to forge these new partnerships, so if anyone is listening to the podcast that is interested in partnering with us, please do so. We are very keen to partner with other global retailers. 

👉🏾 Yes, it actually has been very sad and you know at Rangsutra again, we are fortunate to have good partners who did not cancel orders, who also gave us relief for the artisans and chipped up with whatever little we had. 

The government, I think they just were not prepared and didn't know what to do. I think they have tried in their own ways - giving orders to small self-help groups of women to make masks for example, because everybody needs masks. But, I think in terms of a longer strategy, I don't think very much has been done. But what is good is that there are many organisations which have got together and are helping artisans in different ways by selling their products on their platforms or online platforms, by helping them to digitally photograph the products, helping them with marketing them. So I think it's been more of the community of craft organisations, which have supported the artisans.

👉🏾 It's sad actually, it's really sad that they were abolished. Maybe they needed a change, they needed to be transformed in the way that they were operating, but definitely one needs a body to support the artisans because otherwise, they're so cut off from everything, not just financial resources, but market knowledge information. So definitely it's sad that they had to stop that. Hopefully, there'll be something new in place, I know that artisans themselves are trying to get together and we're all trying to get together to form our own body, but let's see how that goes. 

👉🏾 So right in the beginning, it was quite tough because when the first lockdown happened, they didn't have access to basic stuff, like ration that they needed to buy. It was difficult they hadn't stocked up so much and the far-flung villages were cut off. The only good thing is in most of these villages, they grow their essentials, including vegetables and of course grains but it was very difficult. But one thing I can say is that compared to the workers who are working in factories in the big cities, who had nothing left and who had to walk back to their homes. Our artisans, because they were based in their homes and they had other things to fall back on. Like for example farming or cattle you know some of them have cattle, so milk. So they have these other things to fall back on, so that's the beauty of rural economy that not everyone is dependent on just one occupation. 

👉🏾 Most important thing is that I would sum it up in a line where one of our guiding values, respect for the customer, respect for the producer and respect for each other. By respect for the producer what is non-negotiable is that they have to be paid a fair wage, they need to be skilled we need to provide that opportunity because they've not had opportunities before. Respect for the customer for us, it means that if you have promised a certain quality and a certain delivery time, you have to stick by it. So that's important and of course, respect for each other. So this is like, non-negotiable. Inclusiveness, that we try and include the most marginalised. So most of the artisans we work with, traditionally come from what is called, scheduled caste or you know, backward caste. And they're in such a situation because they've not really had the opportunity to skill themselves. We work hard to ensure that they get the necessary skills and resources to grow. So that commitment to artisans, the compassion, is a non-negotiable.

👉🏾 So the dream is to build it into a global brand, and the brand that stands not just for beautiful handcrafted products, because yes Indian crafts are known for that.

But to show that there is a way of doing business, in which one can be profitable, sustainable, thriving. At the same time, ensure that the artisans, the ones who make the products they benefit equally, if not more. That all profits are shared with them and thirdly, most important is that through our work we do not harm the environment. And in that sense working with handcrafts is very low energy, we don't use much electricity in our weaving, no electricity in fact. And what we have tried to do is now whenever we do need in some cases power, we are tapping into solar power. So yes, to show the world that there is a way of doing business, which is good for all.

Follow Rangsutra and Smita Ghosh on: 

https://www.linkedin.com/in/sumita-ghose-5567795/?originalSubdomain=in

Twitter: @Rangsutra

Website: https://rangsutra.com/about/

Other important links

https://www.indiawest.com/news/india/empowering-village-women-an-ikea-initiative-partners-with-rangsutra-to-create-sustainable-livelihoods/article_f163e650-baac-11e7-b5b5-8b97cc08683a.html