Khoja Peddlers in North India
(circa the 1870s)
Khoja business enterprise expanded out of Punjab and Multan in the 1860’s. According to British government trade records, around the late 1860s, some Khojas from Sialkot began buying country prints, unbleached cloth, dhotis, and pagris from Kanhya Lal, a Mahajan based in Kalka and selling them on credit to peasants on the foothills of Simla.'(1)' (Ed. approx 105 km away)
Being a closely-knit community, the information on available opportunities was freely shared at the Jamatkhana community center as is custom even to this day.
“Encouraged by the profits, other Khojas began transactions on a larger scale with Ambala firms, and then by the 1870s forged links with the big cloth merchants of Delhi. Cloth and piece goods acquired in Delhi were now peddled in villages in distant parts of India. Through these Khoja peddlers, cotton goods worth over Rs 400,000 from four Marwari firms of Chandni Chowk (Delhi) reached the villages of UP, the northwest Provinces, Bihar, Bengal, Bombay, and Berar by the 1880s.”(2)
The organization of the Khojas reflected their centuries-old caste-driven method of cooperation and joint enterprise.
“These peddlers moved in groups of 5 to 12 men. The headman (jamadar) of each group booked the transactions with the Delhi firm and organized the itinerary. An accountant kept records as the party moved from one village to the next. A detailed list of 1878 gives us the name of 126 Jamadars operating with 756 Khojas, acquiring their goods from the four firms of Chandni Chowk, Delhi.” (3)
The essential ingredient to successful affinity enterprise is that although common community bond brought them together, proper documentation ensures compliance and breeds trust. It appears that the Khoja trading class had developed this ethos long before they ventured out to Africa and the world.
A sophisticated method of supply and delivery ensured rapid travel on trains etc. from the major urban centers.
“They did not always travel with their purchases across the country: many big firms had agents in different cities. So the Khojas could book their orders in Delhi and acquire their supplies from the local agents in Calcutta and Bombay, before peddling the goods in nearby villages.“ (4)
“Even the poor could buy from these peddlers. Once the headman of a village identified a cultivator as a resident of the village, the Khojas were willing to sell on long-term credit. Sales were made in November, December, and January, and debts recovered in March and April.” (5)
A similar system of advancing credit to African peasants helped establish the Indian trading networks across East Africa, which the early Khojas apparently brought with them See the stories of the East African "Dukawalla" or Dukan walla - a name that makes sense, because in North India, the Khojas operated only as "peddlers"
“Most peasants, particularly the poor, could pay only after the harvest; and cash purchase from an outsider was always to be avoided. Credit acted as a guarantee for the product sold and a basis on which trust could be built between peasants and outsider.” (6)
This credit system effectively allowed the subsistence peasants to enter the market economy and have access to life needs. See the story of Kanji Jetha Lala, of Gujarat.
“In 1878, 19 Jamadars with 142 Khoja peddlers with them booked orders worth Rs 81,450 with Hazari Mai Babban Mai in Chandni Chowk, but they procured their supplies from the agents of the firm in Calcutta. (7)
Similarly, 27 Jamadars with 184 Khoja peddlers booked orders worth Rs 104,300 with the same firm in Delhi and collected the goods from their agents in Bombay. On the other hand, the 59 Jamadars with 312 peddlers going to Central India and the North-Western Provinces carried their stocks from Delhi, (8)
The level of marketing sophistication was astounding.
“These Khojas divided the rural markets among themselves. ‘Each headman selects a circle of country to which he limits his sales’, we are told, ‘and he does not quit until the spring crops are cut and his dues are realized.(9)
"Such spatial division of the market eliminated competition among peddlers and allowed a peddler—moving in the same circuits and meeting the same faces—to become a familiar figure in the village. To sell, the peddler had to win the confidence of peasants, and overcome their suspicion of strangers." (10)
A similar pattern was developed early in East Africa where siblings went to different towns to establish retail outlets or branched into vertical supply chains to retain control. See Moloo Hirji brothers in Tukuyu, Tanzania, who went into this kind of horizontal expansion.
"After the harvest, when the payments were collected, the Khojas returned to Delhi to settle accounts with the firms. Having paid seventy-five percent of the total value of the goods at the time of purchase, they now had to pay the remaining twenty-five percent, the normal credit allowed to good Jamadars."
"Punctual payment was a question of honour and collective responsibility. Should one of their class become a defaulter or abscond’, reported the Inspector General of Police, Punjab, the others club together and discharge his debt at once, trusting to recover their money when they reached home" (11)
"Honesty and trust were reciprocally linked, each reinforcing the other. To reach out to the villages, Marwari firms had to extend credit and trust strangers, but to renew the cycles of credit and sustain the supplies of cloth, relations of trust had to be reaffirmed and honored." (12)
"A code of honour was the only security that the Khojas could offer; it was the basis of their liquidity." (12)
Society and Circulation: Mobile People And Itinerant Cultures in South Asia, 1750-1950
(1.) No. 9342 dated Fort William, 30 May 1878, J. Munro, Inspector General of Police, Lower Provinces, to the Secretary to Govt. Punjab, Judicial Department. Bengal Political, 16 July 1878, A16 and 17; no. 63 dated 19 March 1879, Col. A.H. Bamfield, Officiating Inspector of Police, Punjab, to the Secretary to Govt. Punjab, Punjab Home, 25 March 1879, A10, Oriental and India Office Collections, British Library, London (OIOC).
(2.) Markovitz,Claude pg 171
(6.) pg 173
(7.) No. 63 dated 19 March 1879, Col. A.H. Bamfield, Officiating Inspector of Police, Punjab, To—The Secretary to Govt. Punjab. Punjab Home, 25 March 1879, A10
(10.) Markowitz pg 173
(11.) No. 9342 dated Fort William, 30 May 1878, J. Munro, Inspector General of Police, Lower Provinces, to the Secretary to Govt. Punjab, Judicial Department. Bengal Political, 16 July 1878, A16 and 17; no. 63 dated 19 March 1879, Col. A.H. Bamfield, Officiating Inspector of Police, Punjab, to the Secretary to Govt. Punjab, Punjab Home, 25 March 1879, A10, Oriental and India Office Collections, British Library, London (OIOC).
(12.) Markowitz pg 173