ABSTRACT

Background:
The Company X offers mobile based virtual services offering customized agri advisory services
across the country. Majority of customers are small and marginal farmers relying on the services
as a key source of information for farming and allied practices. The large chunk of subscribers
are non-smartphone users as a result the company is not much benefited by the internet boom. To
diversify the business company is keen to invest in the market and is backed by a strong rural
super brand and has many strengths including visibility in deep rural pockets, rural distribution
and network, core agriculture backend team, farmer base , 100 plus connected FPOs , decent
technology support team.

Case Description: As a part of diversification process company X invested in few new verticals
1. Cattle Feed
2. Agri-tech Integrations
3. Retail Product

The challenge for the company is to scale each of the verticals, utilizing the existing bandwidth
(largely telecom) in non-telecom products and set up the diversified businesses as the
mainstream revenue channels. Each of the verticals started off well but the company scaling up is
going to be difficult.
As the company wants to be among the market leaders in all its segments it is investing in and
thus is looking for innovative ways of sales and marketing, e-commerce , e-distribution stacks to
increase productivity of the channel, innovate in product , subscriber base.

Conclusion:

Cattle feed
Cattle feed cost is the major recurring cost that farmers incur especially in poultry and allied
sectors. The increased milk, egg and meat production can be leveraged by the company to
undertake value addition and sell the finished products through their FMCG division.
In India, one-fourth of the agricultural produce is lost to wastage due to supply chain
inefficiency. While efforts are being made to address this problem, it will take time to get things
in order. Company X could upcycle the food waste collected from farms, Agricultural Produce
Market Committees (APMCs), juice shops and other sources, and dehydrate them in a controlled
environment without exposing the substrates to direct sunlight or high temperatures from burnt
fuels. If this process can be expedited and made quicker, it could be used to commercially
produce a low input cost cattle feed but with requisite fortification made better and launched at
competitive prices to capture market share. Probiotic feed additives could be used to further
enhance the quality of the product.
While there are a handful of firms offering concentrate feed based on fruit and vegetable feed
powders to silage, based on agri-hub wastes like banana leaves and carrot tops. Company X
could gain the first mover advantage by producing it at a large scale and use its wide reach
among farmers and rural pockets, the 100+ connected FPOs to push the product and create a
name for itself. As the price for this could be kept below the orthodox cattle feed products, the
small and marginal farmers would be the major buyers and thereby providing potential inroads
into premium cattle feed products. Company X could make another little tweak by providing
expert opinion on cattle nutrition to farmer members and especially to adopters of the company’s
new cattle feed products.

Agri-tech integrations
1. Hydroponics: Since the land available with farmers is very less , Company X can use this
method as it grows plants without soil using mineral nutrients solution in a solvent. It uses a
combination of solar , desalination and agriculture to grow vegetables. Plants commonly grown
using hydroponics are tomatoes, peppers, cucumbers, lettuces, strawberries. It offers many
advantages, one of them being a decrease in water usage for agriculture. So apart from the
problem of limited land it will also help the farmers as the requirement for water is very less in
this method.

2. Data driven farming: Using data driven farming Company X can help the farmers in
increasing their farm productivity per area and better utilization of farm resources by analysing
the information about weather, types of seed, soil, marketplace trends and prices. This will help
the farmers in taking an informed decision.

Data driven farming usually include various modern technologies which collect accurate farm
data for example:

● Soil and crop sensors: It helps in measuring the soil and crop conditions like the amount
of soil moisture present which will further help the farmers in managing irrigation in a
better way.
● Variable rate technology: It provides the information about the right amount of inputs
such as seeds, fertilizers, pesticides that needs to be applied on each part of the field.
● Weather stations help in tracking the weather conditions.

As there is a large farmer base linked with the company it will benefit the farmers and increase
their productivity which will benefit the company in expanding its business .

3. Use of blockchain technology: Company can invest in warehousing technology. The Central
Government is promoting the creation of new Agri-warehousing capacities or augmenting bank
credit to farmers against negotiable warehouse receipts (NWR). From 2011-12 to 2018-19,
Cumulative value of commodities deposited against NWRs was over Rs 6200 Crore and total
loans given out against these receipts is just around Rs 1700 Crore. So, we can see that there is a
huge gap and this gap can be utilized by company to expand its business. With the help of
blockchain network and mobile app company can connect banks, warehouses/collateral
managers and borrowers on one single platform. Using blockchain’s tokenisation and
immutability properties, the network reduces risk of lending of banks and smart contracts can
help to increase efficiency for other participants. This platform can provide loans to farmers in 5-
10 minutes in a more secure and transparent way. For banks, this measure will become a risk free
lending process and brings transparency into the system. For farmers, it will help them from
financial losses which occurred due to low market prices at the time of harvest and their income
can be increased by 30-40%. It will help in bringing back trust and transparency in the
warehouse receipt financing market.With the coming of new Agri farm bills and other incentives
to develop warehousing infrastructure close to farms, companies can launch e-trading platform.

Retail products
Company X can do value addition to its farmer members’ produce like use the available mustard
seed cake to launch mustard oil and similar products like organic soap under its organic products
umbrella and market it in the right way using its tech-based reach and leverage the strong FPO
connections for procurement of raw materials and distribution of finished retail products.
In addition to this, excess milk production from its farmers members’ can be undertaken to be
sold to Company X’s retail division as milk, buttermilk, curd, butter, and cheese. Likewise, the
wheat being produced by the farmer members can be used to make flour to be sold in convenient
5kg and 10kg packs after observing initial response in the market. The procurement, supply and
distribution should not be an issue as discussed earlier.
In all our suggestions in this, we are trying to reiterate the fact that company X could make use
of its strong connections with farmers and FPOs to further benefit them and in addition create a
market for itself with some margin of profit trickling down to the members in addition to the fair
prices and stable demand that company X would have, especially following the refurbished farm
Act Bills which should further strengthen our case of going ahead with the plans.
Apart from that the Company can incentivize farmers into adopting the products and expand
digital outreach by using different applications in vernacular language for promotion and
information dissemination. Events like Kisan mela can be organised for product advertisements
among the farmers.
Company X can sign MOUs with e-commerce platforms for selling their products. This will
enable them in selling their product directly to the consumers and increase their customer base.
In addition to that, e-commerce platforms will provide them with marketing tools and world
class infrastructure of storage and distribution networks which will help them in making progress
through online selling.