Struggling Kerala Dinesh Beedis sees spike in sale due to lockdown

The availability of cheap beedis from other states had led to a decline in sale over the years.
Struggling Kerala Dinesh Beedis sees spike in sale due to lockdown
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Even as many small-scale and large-scale businesses were hit due to the coronavirus pandemic and the subsequent lockdown imposed to contain it, a 51-year-old Kannur based cooperative enterprise in Kerala was unaffected. In fact, Kerala Dinesh Beedis even experienced a spike in sales during the lockdown, which came as a shot in the arm for the struggling business.

"During the lockdown, we had a spike in sales as the cheaper beedis from Tamil Nadu and Bengal could not reach Kerala. Later, when the rules were relaxed, the sales dropped to the earlier status. But we were not affected much as people used to buy and stock beedis even if the shops were closed," C Rajan, Chairman of the Kerala Dinesh BWCCS (Beedi Workers Central Cooperative Society) told TNM.

Dinesh Beedis was established in 1969 during the second EMS Namboothiripad government. It was an initiative by the communist movement after a private beedi maker firm shut their unit and many workers lost their jobs.

Though Kerala Dinesh Beedis does not make much profit from the business, they mainly aim to provide jobs, especially for women. The beedi industry has been on a decline for the past several years in the state.

"We pay Rs 504 to those who make 1,000 beedis, while in other states they pay just Rs 75. They can therefore sell the beedis for cheaper rates in the market. Moreover, we may be the only beedi makers who pay Rs 18 crore tax to the government. Above that, we provide our workers dearness allowance, Sunday wages, holiday wages, earned leave, bonus, and gratuity. They are also eligible for the provident fund. So, our production costs are higher," Rajan added.

The workers are from Kannur, Kasaragod and Kozhikode districts. A dozen Dinesh Beedis are sold for Rs 10, while other brands sell 20 beedis for the same price.

In the late '70s and in the beginning of the '80s, there were about 42,000 beedi workers in Dinesh Beedis. Now there are only 4,500 workers, the majority of whom are women.

"Initially, when the lockdown was announced, we shut the society. Later, the workers started rolling beedi sticks at home. By May, we were able to make a recovery," Rajan added.

Dinesh Beedis sells an average of 6 crore beedis per month. Until 2017, they had a sale of 8 crore beedis per month. But, when the cheaper beedis began to arrive from other states, the sale dropped. The annual turnover of the company is around Rs 55 crore.

"Our beedis are unique in that we make them with a special blend of tobacco. We have our own blending unit. Flavours are also different from the other cheaper ones in the market, so that gives us steady customers," Rajan said.

Due to the decline in the beedi sale, the cooperative society diversified its business and it now includes software development, information enabled services, education, processed foods, umbrellas and apparels.

"However, those streams have been hit by the pandemic. Online purchasing is also not working as there are very few courier services," Rajan said.

From 2014 to 2018, the Kerala Dinesh BWCCS won the Fair Business Practice Award from the Associated Chamber of Commerce and Industry of India.

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