TASMAC-The Local Soothing Joint

By Amit Nakra
FT-13105

Shop No-4524 – A local Government owned wine shop

Location: Anupuram
Items sold : Whiskey , Beer and Brandy

                                           

History: 

Tamil Nadu State Marketing Corporation (TASMAC) is a company owned by the Government of Tamil Nadu, which has a monopoly over wholesale and retail vending of alcohol in Tamil Nadu, a state in India. It controls the Indian Made Foreign Liquor (IMFL) trade in the state. 

TASMAC was established in 1983 by the government of M. G. Ramachandran (MGR) for wholesale vending of alcohol in Tamil Nadu. The state has a long history of prohibition, first implemented in 1937 by the Indian National Congress government of C. Rajagopalachari. In 2001, prohibition was lifted again and TASMAC became the wholesale monopoly for alcohol. For retail vending, the state auctioned off licenses for running liquor shops and bars. But this led to the formation of cartels and loss of revenue to the state. The government tried to counter this by introducing a lot system from the financial year 2001-02, where potential bidders bid for shops grouped by revenue. But the lot system could not prevent cartelisation, as bidders later withdrew in favour of others. In October 2003, the government passed an amendment to the Tamil Nadu Prohibition Act, 1937, making TASMAC the sole retail vendor of alcohol in the state. By 2004 all private outlets selling alcohol were either shut down or taken over by the company. 

The Tasmac in Anupuram 

Anupuram is a township situated 2-3 kms away from our college. It has a small shopping area comprising of some hardware shops,  a small departmental store , a small mobile shop and a few small eating  joints. It was 5 pm and most of the shops were empty and suddenly there was a shop that caught my attention. It was crowded with wage workers. At 5pm the only place you expect to see a crowd is at a liquor

            

                


As I reached the shop, I observed that it was a very small, which catered mainly to the wage workers and construction labourers. I somehow managed my way in to have a chat with the Mr Tamil Kumar, a government employee who was handling the operations of the shop.
Shop No 4524, was a rented shop with a rent of Rs 1300 per month and was the only liquor shop in the vicinity.  The shop opened every morning at 10 am and closed at 10pm. The products being sold were whiskey, beer and Brandi.  The shop used to get its supply of alcohol in every 2 days, 3 times a week from Chennai. The brands sold in the shop are as follows:

The daily wage workers come to the shop after completing work and prefer to buy a bottle which they are able to finish before they go home.  As a result quarter(250 ml) in whiskey and brandy is more popular  as opposed to the full bottle. On an average nearly 500 people come every day to buy alcohol with the maximum footfall being between 5pm-6pm. Over the last 5 months there has been increase in the number of customers due to new constructions in the nearby areas. The maximum demand is for Mcdowell Whiskey followed by Kingfisher strong beer and then Mcdowell Brandy.

Whenever I used to pass by any liquor shop, I always used to observe that there was always a small “PAN” shop or a local snacks shop next to it. The case was no different here in Anupuram, Just next to the Tasmac shop, there were a few eating joints selling different food items. On discussion with the owners of these shops, I found that they had started business after the tasmac shop opened as snacks are compliments with the drinks, they wanted to target the audience who drank right there.

One of the shops which was in the same compound as the Tasmac shop, was selling Eggs(Fried, Omelette with bread, boiled and scrambled). This shop was also selling plastic glasses, cold drinks, mineral waters, cigarettes etc. The average cost of a meal in the shop was between Rs 10-20.There were other small eating joints as well who were serving chicken with rice, roti’s, noodles etc. The average cost of a meal in these shops was between Rs 50-60.

                       

As 90% of the customers of the Tasmac shop were construction and daily wage workers with limited income, the local egg shop with the average meal price between Rs 10-Rs 20 was the preferred eating joint.

Around 70% of the customers who came to buy liquor would buy plastic glasses, cold drinks, cigarettes and a dish of egg from the shop selling eggs. Small tables were also kept where the customers could come talk, drink and eat.

                     

One of the major learning I got from the visit is that location of the shop and understanding customer needs is very important. The egg shop owner identified who his primary customer would be and accordingly provided the dishes that the customer would prefer at a particular price. An average wage/construction worker’s daily wage is between Rs 100-200 so he would usually not prefer to spend more than Rs 20 on snacks with drinks. The others shops in the vicinity were providing different dishes but the price point was above the budget of the 90% of the customers coming to the liquor shop. As a result the other food shops customers were limited only to the 10% of the public that visited the liquor shop along with a few residents in the Anupuram colony and students from nearby college (which were usually 10-15 in a day ).
I feel there was a flaw in the pricing as well as the product strategy of the other shops in the vicinity selling different food items as was evident with the low sales.  On the other hand I feel the egg shop took the advantage of the location, provided dishes which its customers wanted and charged what its customers were willing to pay.