E chaupal


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E chaupal

  1. 1. Serving the Bottom Tier Markets ITC eChoupal Experience Sharing
  2. 3. Caught in a vicious cycle of underdevelopment Low Risk Appetite Weak Market Orientation Low Investment Low Margins Low Productivity Low Value Addition
  3. 4. Scope of Presentation No access to market, no idea of prices of his produce in the market. Sell off Kachcha crop to Adat at a very low price – farmer and the Indian Agriculture globally uncompetitive. #2
  4. 5. GENERAL PRODUCTS OF ITC e- CHOUPAL <ul><li>Processed Fruits ( Mango, Guava, Papaya etc. ) </li></ul><ul><li>Food Grains ( Rice, Wheat and Pulses ) </li></ul><ul><li>Feed Ingredients ( Soya bean ) </li></ul><ul><li>Edible Nut ( Groundnut ) </li></ul><ul><li>Coffee & Spices </li></ul><ul><li>Marine Products ( Shrimps and Prawns ) </li></ul>
  5. 6. Inbound logistics include the receiving, warehousing, and inventory control of input materials. Operations are the value-creating activities that transform the inputs into the final product. Outbound logistics are the activities required to get the finished product to the customer, including warehousing, order fulfillment, etc. Marketing & Sales are those activities associated with getting buyers to purchase the product, including channel selection, advertising, pricing, etc. Service activities are those that maintain and enhance the product's value including customer support, repair services, etc.
  7. 8. The e-Choupal infrastructure <ul><li>ITC launched e-choupal a knowledge portal providing farmers with a range of information and services. </li></ul><ul><li>Information in their own language on weather, market prices, knowledge on Scientific farming practices, risk management etc. </li></ul><ul><li>Internet operated in the house of one trained farmer, Sanchalak </li></ul><ul><li>Warehousing Hub with Internet Access (storing the farmer’s output) </li></ul><ul><ul><li>Managed by the middleman, Samyojak </li></ul></ul>
  8. 9. #3 Picture of Indian Agriculture before and after ITC e-choupal: Before After Conventional farming methods Scientific farming methods Compromise on yield and quality of the produce Improve yield and quality of the Produce Agree to whichever prices quoted Get better prices on Output Adat used any method to decide on the price of the output. No Incentive to invest on better quality of seeds. Using Appropriate methods to decide on the price of output. Motivating the farmers to invest in better quality seeds. Attractive export markets Weak infrastructure & inconsistent quality
  9. 10. <ul><li>The Network of 6500 e-choupal centers spread across 40000 villages has emerged as the gateway of an expanding spectrum of commodities like wheat, rice, soya, maize, spices, coffee and aqua products. </li></ul><ul><li>The e-choupal initiative ahs been featured in the World Development report 2008 of the World Bank and Economic Survey of Government of India. </li></ul><ul><li>It is a Havard Case study today. </li></ul>
  10. 11. The Value Chain - Farm to Factory Gate #9 Agri Input Retailer Farmer Processor Kaccha Adat Pakka Adat Money Lender Trader Broker Dept of Agri Input Cos Seed Fertilizers Chemicals Practices Stockist Govt Univ. Met Dep MSP Insurance Practices Weather
  12. 13. In other words.. #13 Agri Input Retailer Farmer Processor Kaccha Adat Money Lender Trader Broker Dept of Agri Input Cos Seed Fertilizers Chemicals Practices Stockist Govt Univ. Met Dep MSP Insurance Practices Weather Choupal Sanchalak
  13. 14. The e-Choupal assists the farmer in the following ways: 1) Provides farmers with real time information and customized knowledge, enabling them to improve productivity quality of produce and price realization. 2) Allows for aggregation of demand for farm inputs from individual farmers thus giving them, access to high quality inputs from reputed manufacturers at competitive prices. 3) Eliminates middle men multiple handling multiple transportation and wastages hereby significantly reducing transaction costs.
  14. 16. #17 Key Success Factor Self Sufficient Infrastructure Power Connectivity Training
  15. 17. Transaction cost in Mandi Chain (before e-Choupal)
  16. 18. Transaction cost in Mandi Chain (after e-Choupal)
  17. 19. <ul><li>States covered: Madhya Pradesh, Haryana, Uttarakhand, Karnataka, Andhra Pradesh, Uttar Pradesh, Rajasthan, Maharashtra, Kerela and Tamil Nadu). </li></ul><ul><li>ITC Infrastructure: </li></ul><ul><ul><li>Computer </li></ul></ul><ul><ul><li>Internet </li></ul></ul><ul><ul><li>Multimedia </li></ul></ul><ul><ul><li>Broadband </li></ul></ul><ul><ul><li>Smart Card </li></ul></ul><ul><li>Physical Reach: </li></ul><ul><ul><li>Choupals within walking distance </li></ul></ul><ul><ul><li>Multipurpose WH hubs within driving distance </li></ul></ul><ul><li>Key Intermediaries: </li></ul><ul><ul><li>Sanchalak (1 per cluster of 5-6 villages) 1500/state </li></ul></ul><ul><ul><li>Sanyojak (1 per group of 10-15 choupals) 100/state </li></ul></ul><ul><ul><li>ITC (support the farm produce marketing end) </li></ul></ul>#23 The Privileged Assets of eChoupal
  18. 20. <ul><li>Using the “e”-choupal infrastructure of reach & scale & keeping the Sanchalak as the pivot ….. </li></ul><ul><ul><li>The launch of initiatives that can : </li></ul></ul><ul><ul><ul><li>Improve Farmer Livelihoods </li></ul></ul></ul><ul><ul><ul><li>Long Term Community Impact programmes </li></ul></ul></ul><ul><ul><li>Pilot in 4 districts of MP & UP </li></ul></ul><ul><ul><ul><li>Livestock Management programmes </li></ul></ul></ul><ul><ul><ul><li>Water Management </li></ul></ul></ul><ul><ul><ul><li>Self Help Groups focusing on women </li></ul></ul></ul><ul><ul><li>Synergising the skills of </li></ul></ul><ul><ul><ul><li>ITC ‘s management skills, </li></ul></ul></ul><ul><ul><ul><li>“ e-choupal “reach </li></ul></ul></ul><ul><ul><ul><li>The knowledge & experience of NGO’s </li></ul></ul></ul>#25 The New Wave…..Sunehra Kal !!
  19. 21. <ul><li>Rural India’s largest & most effective Interactive Transaction & Fulfillment Channel </li></ul><ul><ul><li>Covering 200,000 villages across 14 States through 50,000 choupals </li></ul></ul><ul><ul><li>1/3rd of all Indian Villages </li></ul></ul><ul><ul><li>Building capability to deliver superior shareholder value sustainably </li></ul></ul><ul><li>Also contributing to </li></ul><ul><ul><li>Enhancing global competitiveness of Indian Agriculture </li></ul></ul><ul><ul><li>And, Raising the standard of living in Indian villages </li></ul></ul>#26 Our Vision
  20. 22. #30 Our Mission “Improve the Quality of Life in Rural India.”
  21. 23. Q UESTIONS <ul><li>The competitors try to attract the farmers by providing them higher prices for their produce than e- Choupal. How to overcome this? </li></ul><ul><li>What could be done to improve the Samyojak- ITC e- Choupal relationship? </li></ul><ul><li>What action should be taken against the Sanchalaks, who unionize and extract unwarranted “Rents” from ITC e- Choupal? </li></ul><ul><li>How to generate a sense of trust in the farmers’ mind with respect to the laboratory tests conducted? </li></ul>
  22. 24. Thank You. #31 e-Choupal ITC Limited