Local economies and digitalization

SMEs are the key drivers of economic growth in the country and they need to start selling online in order to scale up and receive the true wage and value for their products. This presents a unique opportunity for local businesses in Dharavi to tap into the digital market to sell their products and grow with the existing social and business community.

India has over half a billion internet subscribers, making it the fastest growing market for digitalization. Over the last decade, increased availability of bandwidth, cheap data plans, and increased awareness has caused massive growth in internet users, especially among lower-income communities. While the e-commerce phenomenon is almost 25 years old and has reshaped the way business is conducted, it is surprising to note that out of over 63 million SMEs in India; only 2% are selling online (Globallinker, 2019). SMEs are the key drivers of economic growth in the country and they need to start selling online in order to scale up and receive the true wage and value for their products. This presents a unique opportunity for local businesses in Dharavi to tap into the digital market to sell their products and grow with the existing social and business community. Dharavi Market is an online platform founded by Megha Gupta that exclusively displays products made in the many industries that call Dharavi home. 

While Dharavi Market was ahead of the curve, the covid-19 pandemic has exacerbated the need for an online tool to not only keep Dharavi’s industries but also its social fabric alive and thriving. Digitalization has often been considered a threat to the authentic methods of business exchange, limiting the potential it has to benefit humans. In their book titled Bridgital Nation, N. Chandrasekaran and Roopa Purushothaman talk about how technology and human beings can coexist in a mutually beneficial ecosystem. Hence digitalization in local economic sectors can be key to empowering workers, changing consumer behavior, and future trends of e-commerce. Through our interview with Megha Gupta, we learned how digitalization can benefit the workers and businesses in Dharavi.

It’s all about building trust

The informal industries in Dharavi have been continually minimized due to the lack of hygiene, unfair credit, and loose labor laws. Building trust with e-commerce providers as well as among the many artisans and manufacturers is, therefore, one of the first and biggest challenges that must be overcome. Dharavi Market has not only begun to establish this trust but also encourages collaboration among the many skilled workers in the industries. The establishment of trust in a digital platform will create opportunities for Dharavi to grow as a business community as well as a social fabric.

Pride and Identity 

Manufacturing in Dharavi has a stigma of shame attached to it which often leads to price cuts, reduced trust in quality, etc. This has led to various brands hiding their manufacturing location, keeping Dharavi hidden away as an industry. On the contrary, one of the country’s leading food manufacturers proudly provides employment to women in Dharavi, empowering them to take pride in their community. The establishment of Dharavi Market provided the impetus to many businesses that would get their products manufactured in Dharavi to wear it as a badge of honor. This small-scale digitalization of Dharavi has helped it establish and develop an identity that is still evolving as the pride in the community grows.

Challenges

The industries in Dharavi generate more than $1 billion annually, supporting a majority of its population with salaried jobs, daily wage jobs, and others. Despite Dharavi’s lengthy economic landscape, there is a lack of formal systems within which business can be conducted. Most of the work happens on the basis of word-of-mouth agreements which leads to challenges within the SME sector. Due to its informality, this industry is stuck in a toxic cycle of delayed/ reduced payments, lack of capital, and inability to employ skilled craftsmen. This leads to long periods of unemployment and a lack of trust in the industry. The introduction of e-commerce has helped the local manufacturers regularize their capital and payments.

Skill Training and Quality

Dharavi is a skill-based community where artisans perform hands-on, traditional art forms to support their livelihoods. They learn and share their techniques with each other in order to grow and prosper. A digital platform that supports skills training will create space for newcomers and artisans to learn, advance their techniques, and become part of the local economy. The digitalization will amplify the existing social capital, allowing artisans from near and far to share, collaborate through workshops, resource sharing, etc. Dharavi Market is currently exploring ways in which the platform can support the growth of skilled artisans of Dharavi. Their short-term goal is to establish co-working spaces that offer both physical and virtual resources, a clean workshop space in order to maintain quality of goods and services as well as safe production practices.

Inspire the next generation

Dharavi retains skills and knowledge passed down through generations. Residents of Dharavi have grown tremendously since starting their journey as newcomers to the city, learning skills on the job and many years later starting their own small businesses. Dharavi’s strong social fabric has allowed residents to grow and prosper. However, with greater access to education, the influence of media that stigmatize Dharavi, the younger generation is moving away from these skilled crafts to more societal trends that accommodate stable work-life, salary, etc. Labor-based jobs are no longer appealing due to low value, low income, and limited opportunities in the artisanal market. Digitalization and technological advancements are key to capturing the interests of the next generation. The digitalization of these businesses will allow them to diversify their roles, allowing more exposure to untapped markets and much more. 

Digital is the way forward

Building on the digital momentum and technological advancements of the last decade, establishing a digital presence of Dharavi’s businesses is crucial in these rapidly changing times. Despite Dharavi being a container of skills and knowledge, it has remained backstage due to its products not being commercialized. A digital platform can create better reach for these artisans and businesses, opening them up to national and international markets.

As a next step, we ideated a hyperlocal digital platform that will build upon Dharavi’s social and economical networks, enabling them to create systems of resource sharing, space planning, and many more. This platform is a tool that will help systemize approaches for local businesses and also provide a preview into the rich craftsmanship that Dharavi has to offer to the rest of the world. 

 

*This blog is written based on an interview conducted with Megha Gupta, Founder of Dharavi Market.