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Indian Way of Enterprising: A Case of Ambivine*

CASELET, STRATEGY
ET Cases - GSMC, 7 Pages
AUTHOR(S) : Pushyamitra Joshi, Research Scholar, Amity Business School, Noida and Dr. MayankSaxena, Ex-Director, Medi-caps Institute of Technology & Management, Indore

Case Preview

Indian Way of Enterprising: A Case of Ambivine

 

It was summer of 2005, after planting the crop of wine grapes in the 20 hectare land Mr. Motilal Patidar (Patidar) along with 17 farmers involved in grape farming in the Titri village came to know from the District Collector of Ratlam that the Government of Madhya Pradesh included the liquor and winery industry in the negative list under the newly launched State Industrial Policy 2004. Farmers turned agripreneurs it was the first entrepreneurial attempt of a group of 18 farmers including Patidar to  establish a wine unit, which was nothing less than a nightmare. There were two options for them either to wait for change in the state industrial policy or return to the farming of normal grapes.

Maharashtra, was the largest grape producing state in the country, wine industry was flourishing due to apposite and liberal industrial policy introduced by the state  government in the year 2001. Patidar and his fellow farmers were aware of the fact that process of changing the government policy in state would be too  cumbersome and complicated. Further to establish the only winery enterprise in the state would be very difficult. Stepping back also, was not possible for them as  they had invested huge amount of money in the farming of wine grapes. In the words of Mr. Jitendra Patidar, Head (Wine Production) minimum amount required for the set-up of wine  grape farming; was 5.5 lakh per hectare. It was 20% more than the amount required to set-up normal grape farming. Patidar was aware that he should study the wine policy of other states before suggesting changes in the industrial policy formulated by the Government of Madhya Pradesh to start the wine enterprise...........

Wine Business in India

Wine is produced from vitis a variety of grapes generally known as wine grapes or grapevines. Wine is also considered to be a sophisticated drink among the upper and middle class and for laymen it is just another form of liquor. Generally, in India wine is considered as a premium alcoholic drink..........

Idea of Enterprising

Farming of grapes in Madhya Pradesh was introduced by Ryot Ambaram Patidar a visionary agriculturist from Titri village in Ratlam district. In 1982, Ambaram Patidar started the plantation of grapes for the first time in less than a hectare of land. With arduous efforts in a few years grape farming converted into a successful venture and was also adopted by many farmers making............

Formulation of Government Policy

Before 2006, grape processing and wine-making industry was under the negative list of business clubbed with the liquor industry. All the rules and regulations of liquor business were applicable on the grape processing and wine industry. State of affairs changed in the year 2005 as farmers of............

Birth of Ambivine

After getting clearance from collector of Ratlam as per the “Grape processing industrial policy, 2006”, the group established a winery unit in Titri; with the name Patel Wine and Fruit Processing Industries and started producing fine quality wines under the brand name of “Ambi”.............

Production

In the year 2007, Patidar sent Jitendra, his younger brother to the US for a study trip to learn the art of making wines. In four months Jitendra completed his course in wine technology and learnt the basics in the field of wine-making successfully............

Climate and Wine Quality

Climate plays a very significant role in wine grape production and directly affects the quality of wine. Ideal climate condition for wine grape plant while grape berry is in developing stage required warm temperature during day time and cold temperature during nights............

Company Structure

Patel Wine and Fruit Processing Industries registered under the partnership act and followed the proper corporate culture and structure to run the business. Patel Wine and Fruit Processing Industries was.............

Marketing Environment in the State

They explored the marketing environment of the Madhya Pradesh and found that there were few wine brands like Sula wines from Maharashtra and Jacobs Creek brand of Australian Liquor Company Seagram that existed in the market................

Exhibits

Exhibit I: Grape Production and Consumption Pattern (2008)

Exhibit II: State-wise Market Share of Wine Consumption in India (2006)

Exhibit III: Classification of Wines

Exhibit IV: Company Structure

Teaching Note Preview

Indian Way of Enterprising: A Case of Ambivine

 

Synopsis


In 2001 Mr. Motilal Patidar and his 17 fellow farmers planned to grow wine grape in their fields to start winery unit in Titri, a village 5 kilometers far from Ratlam city, a  district place of Madhya Pradesh. In 1982 Titri village was in the news when late Ambalal Patidar planted grapes for the first time and became the first village in the state to do so. But since last 15 years farmers were selling the grapes at the same price of Rs. 15 despite of increasing inflation. The reasons behind starting a wine enterprise were as follows:

  • • Farmers were not getting considerable price for their grapes.
  • • To make agriculture a profitable business by establishing food/fruit processing unit.
  • • Explore opportunities to diversify agriculture business into agro processing.
  • • To provide better employment opportunities to local youth in the village.
  • • To improve the economic conditions of agriculturists through entrepreneurship.

 

After studying the wine industry basics during their visit to Maharashtra they replaced plants of normal grapes with wine grapes but later came to know that grape  processing industry was in the negative list of industries prepared by the government. This left Mr. Motilal and his teams with two options either go ahead with  changes in the policy by communicating with the government officials or give up and start agriculture again. Mr. Motilal knows that it does not make sense to give up at this point and started studying the wine policies introduced by different state governments in India..............

Pedagogical Objectives

The purpose of this case is to discuss the various issues related with business environment faced by entrepreneurs due to distinct policies implemented in various states of union of India and how to overcome them. Case also discusses about the problem faced by the rural agriculturist turned agripreneurs in managing their first ever wine enterprise in the state of Madhya Pradesh. In India wine and liquor industry regulated by state government and considered as negative business.

After going through the case students would be able to understand the issues related with enterprise development are as follows:

  • • The significance of policies prepared by state government to regulate the different industries and role of an entrepreneur to understand it before starting a new ever enterprise
  • • The significance of scanning business environment before starting a new enterprise. It is important to understand the legal framework or legal environment for an industry which is controlled by government
  • • .......................................

 

Teaching Plan

The case is prepared for both classroom discussions and as an assignment. The teacher should motivate students to look for the solutions to the problems discussed in the case.......

An assignment of written assignment includes the brainstorming activity in following points:

  • • Find out the key issues and problems in the case.
  • • Priorities the main concerns in the case and gather related information on it. The information given in the case is sufficient or needed more sources of information to solve the issues?
  • • ............................

 

Assignment Questions

  • I. What problems Patel Wine and Fruit Processing Industries was facing? Was decision of Mr. Motilal and his farmers’ team to start a vinery unit too early?
  • II. ...........................

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Abstract

This case investigates the journey of the farmers of Titri village in Madhya Pradesh (M.P.), involved in grape farming, later turned producers of quality wines. While they started producing wine, they knew little about problems of business environment in wine industry. This case presents an account of the problems faced by the Agripreneurs. This case discusses the diversity and complexity of the legal environment in Indian States with their geographical and cultural differences and every state is governed by distinct business policies or laws as well. Wine industry was absent in Madhya Pradesh due to the absence of farmer communities producing wine grapes. In the year 2005 Mr. Motilal Patidar and his 17 fellow farmers started growing wines grape and then producing wine under the brand name ‘Ambivine’. The case of Ambivine is unique as Mr. Patidar was the first successful agripreneur to start wine production, in the state of Madhya Pradesh overcoming business and  environmental challenges.



Pedagogical Objective

The purpose of this case is:

  • To discuss the various issues related with business environment faced by entrepreneurs due to distinct policies implemented in various states of the union of India and how to overcome them

Case Positioning and Setting

This case study can be used in the subjects introducing the concept of Agripreneurship, Business Environment, etc.

Methodology: This case is based on the primary data collected through interview of owner and management team members of Patel Wine and Food Processing Company and secondary data collected through organizational reports and websites of various organizations

* GSMC 2014, IIM Raipur

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- Caselet
- Teaching Note (**ONLY for Academicians)
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