Honest Pricing


Today, many consumers purchase handicrafts at a premium with an innate belief their purchase is making a difference in the lives of artisans in some community. Habba decided to take this a step further, by introducing a feature called “Honest Pricing”. Habba’s Honest Pricing displays exactly what amount of money the artisan gets on each and every product. This unique transparent model is not just limited to the artisan profit, but holds good for all the costs involved in the entire supply chain, including our own margin (which we cap at 20%, just enough to cover our operating costs).



True to the spirit of Honest Pricing, Habba has made a conscious decision to stay away from standard e-commerce practices like “Sales” or “Free Shipping” as well. We trust that our prices are commiserate with the effort our artisans put into creating these products. And we reflect actual packaging and shipping costs from our logistics partner. This kind of radical transparency is one way for our customers to be aware of what social impact their purchase is creating.


   Income for artisan
   Days of employment

Profit Share as a part of Honest Pricing:


Profit Share is yet another way for Habba to ensure maximum impact for the artisan community. When determining the final MRP of a product, Habba does an exhaustive analysis on competition pricing for the same or similar product in the market. This data is compared to the landing cost of the artefact from the impact partner + Habba’s fixed service fee of 20%. While calculating the MRP, we also add all actual costs from our service providers, such as payment gateway charges, packaging and shipping. The final MRP shown on our website is determined based on the delta between competition pricing and Habba’s calculations. You will always find our prices lower than that of our competition, because we believe affordability is one way to ensure maximum market access for our artisans.

Beyond these fees, 100% of the profits made on a product is passed on to the Impact Partner and the Artisan as an added incentive, and appreciation for their unique skills and efforts. This Profit Share is calculated and handed over to our Impact Partner once a quarter. Our goal is that our Impact Partner use this lump sum amount, however little or big it may be, towards improvement of the working conditions of the artisans, either through equipment upgrades, provision of electricity, loans etc.


Hand Over Heart Certification


In the consumer market, nearly 70% of the products sold as handicrafts/handloom are actually machine-made with an added premium price charged under the label of “handmade”. Sometimes, defects are deliberately introduced to make it look handmade. To counter this issue, and ensure that every product sold under the Habba banner is authentic, we developed our own Seal of Authenticity. Every product which is sold on Habba, carries an assurance that it is indeed handmade. We call this our “Hand Over Heart” Promise. Habba would not be sell any product with less than 60% of creative human effort.



How does Hand Over Heart really work?


Our Partnerships Team visits our potential Impact Partners twice before signing an MoU with them. The first visit is an introduction to the community, art-form, and artisans themselves. We try to make it an immersive experience to understand the life and challenges being faced by the artisans.

During the second visit, our Partnership team analyzes the entire process, and notes down all the steps being taken from start to finish, in the making of a product. The entire process is divided into sub-processes and then broken down into further granular activities as well. The team also captures the break times in between the activities. Multiple time studies are done to get a realistic estimate of the average time taken to finish a process depending on the number of people involved. Based on this data, the hand-over-heart percentage is calculated.

Customer – Artisan Engagement


The Bioscope is a patented first-of-its-kind shopping installation that puts artisan development at the heart of an immersive retail experience. It is a small yet significant step towards promoting the long-term economic well-being of Indian artisans.

We aim to provide Bioscope installations to corporates, as part of their CSR initiative. It is one way to give corporates a chance to make a valuable contribution towards the sustainable development of India’s artisan community, provide them fair wages for their efforts, aid skill development and spread awareness about handmade products. The corporate will be able to track its social impact through a live tracker that displays the number of days of employment they have been able to generate.

If you are interested in installing a bioscope in your workplace, do reach out to us at +91 80 4165 0037 or email us at info@habba.org


Accountability


It is one thing to preach about transparency, but we believe in practicing it internally, as well. It is the only way we can hold ourselves accountable to the standards we have set. At Habba, we have instituted a policy to conduct a multi stakeholder external audit on an annual basis. The panel will be led by experts in the field of social impact, artisan development, leaders from the communities we work with, as well as some of our loyal customers. The objective of the audit is to present and evaluate our policies and results on honest pricing, profit share, and our hand-over-heart certification. The structure we propose to follow is as below –

  1. Prior to the audit, Habba will compile all data pertaining to honest pricing and hand-over-heart percentage calculations for new partners on-boarded during the past year.
  2. Data on competition pricing, time and motion studies performed, and Habba’s margins will be circulated to the panel members.
  3. Habba will also calculate the profit share that is due to all our existing partners, based on sales by partner by quarter.
  4. During the audit, the panel members will have the opportunity to validate the information presented, challenge our processes, and make recommendations for modifications to our existing methodology.
  5. All results from the audit will be recorded and published on our website for our customers and partners to access. Any changes incorporated to our existing processes will also be published annually.

Stay tuned on this page for the report from our first Accountability Audit, scheduled for later this year.

Impact Partner Selection Process:


Habba works with two kinds of artisan communities. Some of our earlier partners were grassroots organizations, who in-turn worked with artisanal groups and clusters. Over the past six months, we have also started working more with individual artisans or smaller groups of artisans who are not bound by a formal structure. Our reason for this shift was because we saw a greater need for Habba’s intervention and potential for impact with the individual artisan community.

Our primary criteria for selecting a partner are transparency and ethical fibre of the team and its members. We also look for opportunities to scale, and a strong impact narrative to support the communities. The Partner Selection process comprises of 4 key steps:


A. Screening:


We have a set of non-negotiables when it comes to selecting a community to partner with. Any organization we intend to work with, is first screened on the below criteria -

  • Must be a Not-for-Profit or Community-owned entity
  • Aligns with Habba values
  • Commitment to Transparency
  • Product Fit
  • Potential to Scale
  • Strong Impact Narrative

B. Partnership Committee Meeting:


The Partnership Committee comprises of experts from the handloom/handicrafts space and the social sector, from within Habba and external. All details pertaining to the potential partner organization is presented in front of the committee. The objective of the committee meeting is to assess all possible dimensions of the partnership, specifically the scope for impact and the need for Habba’s intervention. Partnership committee disapproves when lack of alignment in the mission of Habba and the organization at hand is visible.


C. On-Boarding:


On approval from the Partnership Committee, an Impact Partner is on-boarded onto the Habba platform. An MoU is shared with the Impact Partner, and will be signed by both parties once all the clauses are deemed suitable. One key aspect of the MoU is agreement on the artisan fee, which is the minimum fee the impact partner agrees to pay the artisans for their skills and efforts.


D. Due Diligence:


Transparency is a key value at Habba, and it is important that this is reflected in our impact metrics as well. One way we ensure that transparency is practiced, is by conducting due diligence audits with our Impact Partners. These audits will be done once a year, in the presence of the impact partners, individual artisans and the Habba team. During the audits, we will assess the impact of Habba’s intervention on the life of the artisans. Our impact partners will be held accountable for the agreed-upon artisan fees, as well. On completion of 3 years, we aim to write our social accounts and have it audited by an independent panel and facilitated by the Social Audit Network.