Markets Of Mumbai

Nishi Trivedi

In this ever-growing world of buying and selling of goods, Mumbai city has made a name as the busiest business hub of the country. We also know the city for its variety of food, diversity in language, monumental structures, and the famous intercity local trains. Anyone who lives in Mumbai knows how fast life is, which has given the city the title of ‘the city which never sleeps. Over the years, the city has welcomed people from different states and different parts of the world to set up their businesses which has made the market much more competitive than it ever was.

Known as Bombay, the city was originally formed by uniting seven islands–the Isle of Bombay, Colaba, Old Woman’s Island, Mahim, Mazagaon, Parel, and Worli. They gave the name Mumbai from Mumba Devi, a local goddess worshiped by Koli fishing people. The structures built during the British rule still stands as one of the major tourist attractions in Mumbai. One such attraction is the Chhatrapati Shivaji Terminus (CST), earlier known as Victoria Terminus, which is the largest railway terminal in the city. The other structures such as the Asiatic Library, Gateway of India, and Marine Drive (also known as ‘Queen’s Necklace’) have become the most visited places by tourists and local people. “Even though I have visited Marine Drive since I was a kid, it is still one of my favourite places in the city. These places make a person fall in love with the city” said Atharva, a resident of Mumbai.

The city’s population has increased over the years and has gained the title of the commercial and financial capital of the country. From famous ports to Reserve bank of India to Bombay stock exchange to several wholesale markets, Mumbai deals with every financial sector contributing largely towards the economy of the country. Apart from the business sector, the city is a hub for its entertainment and media industry, adding to the city’s demanding life.

The tale of commerce and finance in Mumbai:

The geographical location of the city has always been ideal for trading. The ports of Mumbai along with the ports of Gujarat were used to carry out trading from the time the British entered the city. Gradually, with the trading of opium, the ports of Mumbai became one of the busiestports. We can say that this was one of the first times the city entered the world of business. Slowly the textile industry also began to grow. Today there are hundreds of textile-manufacturing units all across the city. The size of these industries differs but the production affects the economy significantly.

Business is all about understanding what the market is demanding in the present times. The change in infrastructure to technological developments has affected every industry. Many other businesses have also made their entry into the market. The food industry is one such huge business not just in Mumbai but in every other state or country. But what is more interesting about food asa business here is the way it is carried out. From big restaurants to famous street food, there is a profitable business happening which creates a well-balanced business structure for both.

Mumbai also is home to Reserve Bank of India and the Bombay Stock Exchange, the largest stock exchange in Asia. The stock exchange lists the top companies and their stocks. The city is not far behind in terms of big corporate businesses. The Bandra-Kurla complex is one such world of corporates in this large city. There is a blend of both small and large-scale businesses which helps in balancing the city’s large workforce and in sustaining the economy to a great extent.

The well-connected train lines around the city also played an important role in the city’s business life. Every station has its small market area providing the consumer with a variety of options to choose from. These markets differ in terms of the retail and wholesale form of business. The consumers can visit any market depending on their needs. “The local station market is convenient for me to shop for the daily household items rather than buying them from the malls, which is an expensive option,” said Ms. Sangeeta, a homemaker. People visit wholesale markets when they want to buy things in bulk or at a much cheaper rate. These markets attend to the needs of people from all economic backgrounds and play an important role in the lives of the middle-class and low-income groups.

Understanding businesses:

There are a thousands of businesses around us but it is sometimes confusing to understand what kind of business a person is doing and how one business differs from the other. Have you ever wondered if a person can run a business without having a fixed office space? It is quite possible to have a very successful business without really having any fancy office space or even many employees. A number of businesses in the city operate on a minimum workforce and in small office spaces. The wholesale market has a small shop-like offices where the entire business operates. Over the years many people have come and settled in the city which has affected the price of housing and commercial buildings. Because of this, the small-scale business owners prefer cost-cutting by having smaller office spaces. “I can spend the money on good raw materials and marketing rather than paying rent for large office space,” said Mr. Ashok, a wholesale businessman of saffron. This idea of saving on the capital and spending on production has helped many small-scale businesses to sustain in a competitive market.

The need for employees and even a large office depends on the scale at which the business is working on. There are various sectors of business and each business has a specific form of its own. Most of the businesses carried out in the wholesale markets are owned by sole traders, in partnership, or come under the Joint Hindu Family Business. Now, the sole traders are the only owner of the business. They are the ones who decide how to run a business and make decisions. This is a small-scale business which has its advantages and disadvantages.

When talking about the partnership form of business, there are two or more partners who together are responsible for the business. It is usually on a small scale and also has different rules according to the policy of the company. Finally, the Joint Hindu Family Business is, as the name suggests, is a family business in which the eldest member of the family is the decision-maker and is known as ‘Karta’.Now, what is interesting is that this form of business only exists in India and is a legal business entity according to Hindu law.

These small businesses also play an important part in employing the uneducated section of society. These wholesale markets have many of the workers carrying huge sealed boxes of goods sent by the wholesalers for further production process to other states.

The idea behind understanding the form of business is to know how particular business functions and how different they are from others. When we shift our focus from the small-scale markets to a large scale, then we come across the big corporates, public, and private limited companies. These are the companies that dictate the market fluctuations. But even these small markets affect the working of these big corporate giants. The markets, whether big or small, are interconnected in terms of carrying out business operations. The big businesses do depend on the raw material and goods produced by the small-scale businesses to further carry out their operations. In my further study I will cover three businesses which will explain how even though the businesses are on a small scale and part of the wholesale market, the working is different based on their nature of work and form of business.

Widespread markets of Mumbai:

From Masjid market in South Mumbai to Vashi Market in Navi Mumbai. These markets are spread around the whole city catering to the different needs of the consumer. One of the oldest wholesale markets of Masjid Bandar is known for its various small-scale businesses. The market mainly is focused on producing goods for further sale to large business owners. From small-scale manufacturing units to packaging units, the market seems to have it all. Masjid market is closer to the Masjid railway station and is most times crowded with hand trolleys on the platform for further transportation.

The market is at its peak from early in the morning to seven in the evening, which makes a person feel the fast life the city offers. Sunday, for most markets in the city, is a day to relax, but in case of urgent work, they do function normally. Some businesses have been running for years, and the unexpected workload has become a normal routine. “I havecreated packages for 10 years now. Some days we have to complete two days' work in a day because of the client’s requirement,” said Ms. Sunita, an employee at Mr. Ashok’s company.

Fortunately, there are some markets which are famous for the cheap and large quantity of goods sold directly to the consumer. Manish Market and Crawford Market are a commercial markets that ideal for shopping for big occasions. “I always prefer going to Crawford for buying decorations during any festive season or simple house parties. I get a ton of options and at a much cheaper cost,” said Ms. Drishti, a digital marketing professional. Afew students tend to buy trending products in bulk from these markets and sell them with a profit, to earn some extra money. For instance, the fidget spinner sold at around Rs. 200 was available for Rs. 30 per piece when bought in bulk.

Crawford Market is known for selling bags, dry fruits, small crockery items, phone covers, and imported chocolates at a wholesale price. Crawford is visited by many people from faraway places to buy home décor, shoes, showpieces, etc. With dockyard closer to Crawford, the goods are brought to the warehouses in the market area and then distributed to the sellers across the city. There is another street wholesale market, Lamington Road,officially named Dr.DadasahebBhadkamkar Marg, famous for its electronic goods and accessories both new as well as refurbished. “This street has been famous for a long time. I used to buy project equipment during my engineering days,” said Mr. Maheshwar (45), a software project manager.

The alternative for branded clothes can be found at a cheaper price on well-known streets of Mumbai such as Fashion Street, Colaba Causeway, Linking Road, etc. Linking Road has a perfect blend of branded and local clothing shops. Popular among the college-going crowd, these streets are popular in this highly competitive market. Even the clothes are bought by people in bulk and put up for sale at relatively higher prices. The idea behind all these markets is the focus of goods and the location at which they are put on the market. A large number of foreigners pay a visit to Colaba Causeway to buy Indian jewellery and ethnic clothing.

Case studies:

Gold manufacturing unit, Masjid Bandar:

Have you ever wondered how a gold chain is made?The fancy and attractive jewels we see in big showrooms are made in small manufacturing units. Mr. Suhird, owner of one such gold manufacturing unit showed how he manufactures the gold chains which are later is given to jewel artisans for polishing. The method for preparing these chains sounds simple and quick but in reality, it does require patience. “We first melt small gold bars and then on them into thin rods which are then transformed into wires for further processing,” he said. The wires are made precisely and accurately depending on their weight.

This small and compact manufacturing unit is situated in the heart of the masjid market. With six to seven small machines the whole process gets much easier and faster. This also has helped in saving a lot more expenses in terms of having a large office space. “We make gold chains and the equipment for it is not that big, which has given us an advantage in saving our expenses”, he added.

The machines in the unit are operated and handled by two or three workers. These workers do not receive sufficient pay as most of the profits are earned by retail sellers.Manufacturing units are solely based on producing raw products that are sent for a lot of processing before it reaches the consumer. In such situations the need for any form of marketing is eliminated, thuscreating an ideal situation for following the traditional business style.

Further, asked about how GST and Demonetisation affected his business, he said, “I do not have .knowledge of accounts and I had to hire an expert to understand the process of GST. It was an added expense in my budget," he stressed. He also said that after Demonetisation the market slowed downand wasstill recovering.

Saffron wholesale business, Masjid Bandar:

Established in 1947, the company is one of the oldest businesses in the market. Started by his father, Mr. Ashok took over the business after him and has successfully managed to follow both traditional and modern forms of business. “With the rise of the internet, we havesucceeded in targeting new consumers through various social platforms. But at the same time we follow our traditional way of marketing our business,” he said.

Asked about how his business works, Mr. Ashok explained the process of packaging the product in detail. The saffron is first weighed and packed in different boxes. "We have one gm., two gm., and five gm. packets based on what the client requests," said Ms. Shailaja, an employee in the company. Also, there are two different types of saffron which are packed; Kashmiri and Iranian saffron are what the company deals in.

The process of packaging begins with inspecting the saffron, followed by segregating into smaller containers based on weight. These small packets are then placed in a machine where they are packed airtight and sealed. It is then placed in small boxes with the company’s name and logo. The finished product is then sent to other business owners for further resale.

Mr. Ashok believes packaging and the look of the boxes also play an important part in selling the product. Not just the wholesale business but the company has even started selling its product on websites such as Amazon and India Mart. "These websites have helped me gain a number of new clients and is a good way to expand my business," he said. He also believes that the introduction of a new style of packets and containers has helped in gaining the attention of consumers.

Saffron being one of the expensive commodities is usually ordered in bulk before festive seasons. "We usually get orders from sweet shops during the festive season. There is sometimes higher demand during the wedding season," Mr. Ashok said.

Asked about his views on Goods and Services Tax (GST), he said that even though the process was long it has helped him in terms of creating bills and keep a track of his sales. The business model has to be accommodative towards policy changes and has to be followed properly to avoid any form of business block. “You have to be alert and be updated with what is happening in the business world for your product to sustain in the market,” he stressed.

Throughout the process of understanding his business, I was able to understand that there are many ups and downs in this type of business and there has to be a plan B at all times to be able to rise in case there is an economic slowdown.

For this business, we can make out that there was a clear idea of creating a social presence to have an alternative for other business strategies. “No matter how good your product is, if the marketing is not strong, there is no value to it,” he added.The company follows the idea of developing new ideas depending on the changing market needs. It focuses on being flexible with time to maintain a steady position in the market.

Dry fruits and spices wholesale business, Vashi Market:

Set up in the Agricultural Produce Market Committee market (A.P.M.C), Vashi, the business is run by Mr.Ramnivas and his two sons Mr. Nilesh and Mr. Sachin. They are into trading in and import of dry fruits and spices. The company focuses on only business-to-business structure.

Vashi Market is known for its wholesale businesses of dry fruits, vegetables, and grains. This market comes under the Navi Mumbai which is why the market is well-planned and is spacious for having big warehouses required for this kind of business in which proper storage is required. There are separate cooling storages where the spices are kept and later are sent for packaging when there are orders. “Trucks collect goods in bulk from every business house here. They include grains, vegetables, and our spices which later are distributed not just locally but sent all across the state,” Mr. Nilesh said.

Before any consignment is sent to the distributors, there is a specific process that is followed here. The spices are first weighed on machines and then are filled into packets and then later they are sealed. Even though the process is simple the weight of the spices should be carefully measured before dispatched in trucks to different locations.

Mr. Nilesh said they did not have any social media marketing strategies as they worked on a credit basis and it was unsafe to work through the internet as there was no guarantee to reach a genuine buyer. “Our business works on credit and we don't have an upfront payment as of now. On social media, it is a new customer for you who is difficult to trust and so we don’t believe in online business. We have our own set of brokers and customers,” Mr. Nilesh said.

Demonetisation also affected the working of the business differently. "We had anumber of walk-in customers who used to carry cash but during Demonetisation, it created cash crunch and there was a liquidity issue which was resolved much later,” he said. Good and Services Tax was another government policy that the company feels had another impact on the business. “It has created transparency in the business and also made the movement of goods much easier. Earlier we had survived issues with interstate transaction and because of GST there is some relief now," he added.

Balance of business in economy:

On November 8, 2016, the country faced the challenge of Demonetisation. It disrupted the daily life of the general public and immensely affected the business markets leading to a slow pace working of markets for a short while. The idea behind currency change was to stop the inflow and outflow of black money which to a certain extent was achieved. But what the government failed was to realize that it only targeted small and medium businesses and not the giant corporates. Even though some amount of black money was retrieved by the government, there were still many loopholes which the large business owners were able to find. The currency exchange process took a long time for many small business owners which affected their circulation of money in the market.

Goods and Services Tax (GST) was introduced eight months later which was baffling and unclear in the beginning to not only the small-scale business owners but also to the educated working class. Businessmen who did not have much commerce and accounting knowledge had to hire experts to understand and modify bills according to new GST reforms. This added additional expenses affecting their income.

The policies of the government over the years have been successful to some extent but some have eventually been biased towards big organizations. The businessmen who were not clear with some policies had been fooled topay the government officials, said by Mr. Ramesh (name changed on request).

Globalization is also a factor that has affected the market in many ways. Earlier, the business was about trade between cities and states but with globalization, the products made in small factories have reached other continents. It has also made small business owners even in remote areas of the country explore various opportunities available for their products across the globe.

Globalization has opened the door for foreign competitors thus creating jobs for young talents in the country. Butat the same time with the advancement in technologies, there has been a sharp decline in the need for workers in many industries mainly in manufacturing, chemicals, and textiles.

E-business and the world of social media:

Earlier, word-of-mouth form of marketing was considered the most effective. But with the internet controlling a major part of our life, this method of marketing has taken a back seat. Have you ever searched a particular product and then got so many adds on every social media platform for the same product? It certainly creates a sense of worry in your mind. Nonetheless, this is a very effective way for any business organization to understand what kind of product their consumers are demanding and helps them in recognizing their target audience.

E-business acts as an alternative for these businesses to grow and associate with larger consumer units. It has turned out to be a stress-free process to list the product on the internet because of the involvement of big companies such as Amazon, Paytm and Flipkart. Amazon, in particular, has started its seller portal where businessmen can list their companies and sell their products. “Amazon seller portal has turned out to be very beneficial for my business. I have gained a lot more clientele,” Mr. Ashok explicated.

In the last few years, digital marketers have created a successful line of jobs in this sector. There is a high demand for digital marketing jobs giving the work much more security than it was earlier, Ms. Drishti believes. Social media has also played a major role in helping new start-ups target the right consumer group. Instagram, for instance, has helped many people create their business page and promote their products.

Although the use of social media by businesses is gaining popularity, there are still some business owners who feel the traditional way is more accurate and trust worthy. “I have been running this shop of bags for a long time. I have gained very trusted clients over the years and still manage to attract new customers. There is no need for internet marketing for us as of now,” said Mr. Maqsood, owner of Bag Shop in Crawford Market.

E-business and the use of social media have created a significant balance in the world of business. Be it large scale or small scale they have helped in creating awareness about what different kinds of products a consumer can go for. They have not only helped industries find thecorrect target audience but also aided the consumer in discovering various options they can choose from. “I shop online with good discount options while commuting to the office so that I do not have to spend extra hours in a mall,” said Ms. Mansi, an IT professional.

There have been conversations and debates regarding the working of small businesses in Mumbai city for a while now. It is quite surprising that there are so many businesses thriving in the city on small, medium, and large scale complementing each other in a friendly manner. Through research and interaction, I was able to comprehend how these small businesses have contributed largely to the economy of the country. It also justifies why the city is given the title of ‘commercial and financial capital’ of the country.

We cannot overlook the collaborative working of corporate giants and the Bombay Stock Exchange in contributing to this developing economy. However, major threat to small businesses from these big corporates. There is a clear need to eliminate competition because of the existing complications in the business world. With foreign companies setting their businesses in the country there is a flow of income for the government. But, for the past few years, we have been struggling with the slowdown in the economy which has been a major setback for small business organizations.

Despite the challenges of a slow economy,these businesses are still finding other options and coming up with new ideas to survive in the market. It is quite clear with the observations and personal accounts of some of the small business owners that these markets are an essential part of thriving Mumbai and what the city stands for.

Irrespective of its space constraints, the city still welcomes many small businesses from other parts of the country. Owing to its name as ‘the city of dreams’, Mumbai is encouraging the dreams of many such small businesses.The only question is how the government is going to upscale these small businesses; an essential part of India’s wealthiest city, Mumbai.

Bibliography

• www.britannica.com/place/Mumbai (the history of Mumbai)

• http://www.legalservicesindia.com/article/1018/Globalization-&-its-impact-on-Indian-Economy:-Developments-and-Challenges.html

• https://www.encyclopedia.com/places/asia/Indian-political-Geography/Mumbai

• Spoke to various business owners and consumers to understand the markets in detail.

• Use of personal opinion at certain places

• Quotes from expert sources