Company: CARE Bangladesh

Company: CARE Bangladesh

Country: Bangladesh

Project Name: Women Empowerment on the Road to Export Markets

Category: Poverty

Website:

Objective:

The project aimed to do the following:

i.assist most marginalized women in Northwest Bangladesh fight poverty and hunger, by providing them with sustainable employment opportunities in the home textile enterprise.

ii.improve their technical capacities

iii.foster growth and development in the home textile sector through small enterprise development and improved linkages with the export market

Details of the project:

Bangladesh had a population of nearly 150 million, 40 percent of which lived in extreme poverty. As small enterprises appeared to have the potential to lift millions of people out of poverty, while at the same time contributing to diversifying and accelerating exports, CARE Bangladesh went into the development of small enterprises in promising sectors, such as the home textiles sector. Per the Bangladesh Export Promotion Bureau, the sector had been experiencing an average growth of 20 percent each year. In FY2008 to 2009, exports of US$313.51 million provided employment and income to a vast majority of the poor and the extreme poor.

CARE was particularly interested in working with this sector because in many parts of rural Bangladesh, a large number of poor and extreme poor were traditionally highly adept at crafting home décor products. Further, CARE’s recent experience in private sector engagement led to building relationships with various actors in a typical home textile value chain, such as the rug value chain. These relationships were capitalized to strengthen the chain, and to develop profitable rug making enterprises linked with the export markets. In May 2008, CARE started to develop rug enterprises in Northwest Bangladesh.

To develop rug units, CARE partnered with Systain Consulting Ltd., a German consulting firm, which was the local partner of Kik, a Germany-based retail outlet. Through joint funding from Kik and CARE, an entrepreneur was deployed to own the units, and provide for training, inputs, product development, and marketing support. The entrepreneur had to ensure that orders from Kik were met. Systain was the link between Kik and the entrepreneur, and was expected to provide quality control support, while CARE was to mobilize the extreme poor women from their working areas. It was also designated to provide venues, trainee and other allowances; maintain strategic relationships with the entrepreneur, Systain and Kik; monitor performance and provide oversight, exploring new opportunities and avenues of collaboration in the process.

Initially, CARE transferred funds to the entrepreneur who selected an appropriate location for each unit, purchased handlooms and raw materials, set up production houses, and hired an experienced trainer. After things were set up, the women had six months of specialized training on making rugs according to buyer specifications. During training, the women were paid BDT1,000 each month as allowance. Following training, they began full production, while the entrepreneur sold rugs to Kik, through Systain.

Over the past year, CARE established one more unit, comprising 20 more extreme poor women. Significant progress in the past year made Kik interested to fund a substantial amount of new units in new areas, with new extreme poor women. Of the 600 outlets in Europe, Kik could meet the demand of only five through the existing initiative, and was planning on taking the venture to scale. In a few months, CARE planned to build 12 more rug units under a number of DFID, EC, and USAID funded projects that were at the inception stage in the same area. This promised sustainable income for 300 extreme poor women.

Additionally, through CARE, Kik had been setting aside 50 percent of the profit it had been making from existing rug units, for investment in building the capacities of extreme poor women and for their families health, hygiene, nutrition, education, social and economic empowerment, etc.

Through the undertaking, 120 poor earned an average income of Taka 3,000 per month. Many earned more because wages were paid on the basis of the number of rugs produced. Through the project, some women repaid loans, invested on household health, etc. Their social positions improved: they became major decision makers in their households. After a valuable skill, the art of producing rugs using a handloom, was transferred to these women, they were well positioned to save money, and develop enterprises of their own in the near future.

The enterprise experienced an average monthly growth rate of 15.18 percent in production since its inception in 2008.