Context
Mr. Parameshwaraih is an entrepreneur based out of Kalenahalli village, Gubbi Taluk,
Tumkur District, Karnataka. He is a different abled person of humble background who
has been running a business since the last 20 years. With support of his wife and other
family members he runs a small provision store which caters to the local demand for
daily consumption items. The income from this store is the only source of income for his
whole family. His store is frequented by local community members as well as those who
are coming for work form outside, as it is located on one of the main roads, connecting
to nearby towns.
Solution Overview
Enterprising as he is, Parameshwaraiah was quick to spot that there was a latent demand for
refrigerated products like packaged and chilled water packets / bottles and cold drinks in his village. No
shop in the village was able to provide for this demand and he was keen to invest in a refrigerator and
connect with vendors who could help him supply cold drinks, juices and packaged water. His shop often
had powercuts, and that was the only reason he was questioning the investment on refrigerator for his
shop. In 2019, he learned about solar powered refrigerators and contacted a local Clean Energy
Enterprises and put in an enquiry. Soon he had used his savings, and taken a part loan to buy a 100 litre
solar powered refrigerator for his store.
COVID-19 And Impact on Business
As soon as the nationwide lockdown was declared, the business had been severely affected. Since his
customer base mostly came from people who would be passing by his village, the demand for the
goods in his refrigerator was close to zero. His regular customers were primarily those who would come
from nearby villages to work in the fields or any other workers employed under government employment
programs. Due to the lockdown, such work had come to a standstill, bringing no visitors or tired workers
demanding cold drinks to the village.
Summer season is usually the peak season for his business and he was anticipating a good demand for
the cold drinks since he had built his customer based over the last few months- more and more people
knew that his shop would have a refrigerator and cold drinks. Many local fairs and weekly markets
organised nearby would also bring in additional income.
Mr. Parameshwaraih quickly assessed the scenario and started to stock up the items whose demand
was likely to go up and whose supply was also not affected. He sharply observed that there was an
increase in demand for curd and milk because of the summer. He started stocking up curd and milk,
sometimes upto 10 litres each day. This helped him to steady his earnings on a daily basis.
While cold drinks get him higher margins, Parameshwaraiah’s sales for dairy products has increased
during this period. His sales for milk packets, have gone from 14 to 53 units per day, and curd has gone
from 24 to 30 units.
His daily profits from the refrigerator has seen a dip- from INR 190 per day to INR 147 per day because
of the reduction in sales of cold drinks, ie almost INR 1200 a month, but the demand for dairy products
has helped keep the earnings steady to a certain extent.
KEY TAKEAWAYS
- Ability to make incremental investments helps businesses grab emerging opportunities and push up the earning potential- in this case the addition of the refrigerator brought additional sales and stability to the provisional store.
- The entrepreneur has an ongoing loan for his Refrigerator. A moratorium on the loan contracted will be helpful in softening the impact on the health of the business.
- Entrepreneur’s ability to gauge customer’s demands and preferences depending on the scenario is key in how businesses pivot and adapt during crisis times.
“Business has been impacted there is no question about it but my
investment in the (solar powered) refrigerator has turned out to be a life
line for me, bring in much needed income on daily basis.“
– Mr. Parameshwaraih, Provisional Store Owner
