Aarong Type Social enterprise / NGO Industry Design

Aarong

Type
Social enterprise / NGO
Industry
Design, sales of clothing, accessories, jewellery, home goods, development, economic empowerment of women
Founded
1978
Founders
Ayesha Abed
Martha Chen
Headquarters
Dhaka, Bangladesh
Area served
Bangladesh
Key people
Sir Fazle Hasan Abed, Chairman, BRAC
Mushtaque Ahmed, Executive Director, BRAC
Tamara Hasan Abed, Senior Director, CEO
Abdur Rouf, COO
Sasi Kumar, General Manager, AAF
Products
Clothing
Jewellery
Fabric
Non-textile craft
Leather goods
Footwear
Houseware
Revenue
USD 50 million (FY 2012)
Website
www.brac.net, www.aarong.com


History:
In 1976, Ayesha Abed, the wife of Sir Fazle Hasan Abed, founder of BRAC, initiated many of the major activities of Aarong by identifying and experimenting with various crafts that women could produce at home such as nakshi kantha, embroidered goods, baskets, mats and items made of cane, bamboo and jute. In 1978, BRAC entered into a joint venture with the Mennonite Central Committee, the international development arm of the Mennonite Church, to open a shop in Dhaka called Aarong – meaning 'village fair.' The Mennonites had a long experience of producing handicraft to generate income and had established a programme called Ten Thousand Villages, which worked with artisan groups around the world and sold their products through catalogues and retail shops in the US and Canada. During the late 1970s and early 1980s, BRAC focused on developing Aarong's product lines and production capabilities. They hired master craftsperson to help train village women and created a textile design and service workshop in Manikganj to experiment with materials and technologies in stitching, weaving and dyeing. BRAC also started producing historically imported items such as, men's panjabi. In 1982, the Ayesha Abed Foundation (AAF) was established by family and friends to commemorate the memory and work of the late Ayesha Abed who passed away leaving behind her newborn son, Shameran, and young daughter, Tamara. The foundation was created to develop women's skills in various crafts through an appropriate working environment, financial and technical assistance and training. Initially it was registered with the government to receive foreign charitable donations and raise funds, but now operates exclusively as a part of Aarong. The AAF board comprises the eight family and friends of the late Ayesha Abed. Its budget is part of the Aarong initiative under BRAC. The AAF workers are all members of BRAC's village organisation groups or the family of the members.
During the 1990s, Aarong continued to build brand equity through fashion shows and media publicity events. However, by the late 1990s and early 2000s, Aarong faced a financial setback as a result of mediocre management and a lack of innovation. In 2004, its sales totalled almost USD 14 million. Aarong earned a profit of USD 1.96 million for BRAC which was distributed among its agriculture, education, and health programmes, with the majority going to a special programme for the ultra poor. In 2013, Aarong had crossed USD 50 million in sales.
Brand and customer overview:
The word Aarong means 'village fair'. The brand is meant to generate an emotional connection and loyalty while bringing people together to showcase the best that Bangladeshi's highly skilled artisans have to offer. The customers of Aarong are not only the urban Bangladeshi communities but also include Bangladeshis expatriates looking for products that connect them to their roots and represent their identities as a Bangladeshi. The customers also include foreigners visiting Bangladesh, and as a result Aarong was mentioned in the guide to Bangladesh, Lonely Planet. It is a place to pick up a piece of Bangladesh as a souvenir to remind them of the culture, vibrancy and warmth of the people and country.

Aarong's process flow


Marketing:
Aarong maintains a dedicated marketing staff to assist with major marketing initiatives including traditional print and billboard advertising, exhibits and fashion shows. In 2008, Aarong celebrated its 30-year run by participating in numerous fashion shows and sponsoring a nakshi katha exhibition titled Story of Stitches at the National Art Gallery of Bangladesh.
Outlets
Location
Date of inception
Closing date
Shukrabad Rd, Dhaka
1978
closed
Nasirabad, Chittagong
1983

Mogbazar, Dhaka
1984

Sylhet Town, Sylhet
1985

Lalmatia, Dhaka
1989

Khulna Town, Khulna
1995

Gulshan, Dhaka
1997

Rankin St, Dhaka
1998

Uttara, Dhaka
2001
2011, reopened as flagship
Hilishohor, Chittagong
2008

Mirpur, Dhaka
2010

Comilla Town, Comilla
2012

Narayanganj
2013

Jamuna Future Park
2014


Export:
Aarong's export business started in 1986, with an initial order from Traidcraft, a UK-based fair trade organisation.. Based on Aarong's reputation as a social business, it has successfully grown its export customer base over the last 20 years through the addition of a number of fair trade organisations in Europe, North America, Australia and New Zealand. In 2007, nearly five per cent of sales came from exports, approximately 85 per cent of which were to fair trade organisations and the remaining 15 per cent to commercial organisations. Aarong maintained a London-based franchise that accounted for approximately 11 per cent of the total export sales in 2007. Due to poor management and inventory control both locations were closed in 1994; however, Aarong remains focused on a long term strategy to enter the mainstream Western markets.
Competitors Analysis of Arong:
From the above diagram it is seen that Aarong has competitive advantage over it's competitors on almost every factors. Only few companies have ability to chase some sort of advantage like Aarong. Such as Rina Latif's product features, qualities and innovativeness, Kay-Kraft and Anjan's supplier, Rang's color and Khubsoorti's cost.