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HARIYALI  KISAAN  BAZAAR
INDEX <ul><li>The Rural Market Context </li></ul><ul><li>Gaps in the Rural economy   </li></ul><ul><li>Hariyali Business M...
The Rural Market Context <ul><ul><li>The Rural Ecosystem </li></ul></ul><ul><ul><ul><li>Rural Demographics  </li></ul></ul...
The Rural Ecosystem The Rural Market
The Rural Ecosystem  The Rural Market   There is opportunity to participate in the complete rural ecosystem, i.e. both the...
Rural demographics  The Rural Market   <ul><li>Rural India supports a population of 790 mn. as of 2005 (70% of India’s pop...
Rural Incomes  The Rural Market   <ul><li>Rural India generates an income of  Rs. 19000 bn. ($ 450 bn)  which is  approx 4...
Agriculture The Rural Market
Agriculture Income  The Rural Market   <ul><li>Agriculture contributes about 37% of the rural GDP (Approx. Rs.6000 bn. ($1...
Challenge of Agricultural Productivity  The Rural Market   Increasing agricultural productivity requires new technology an...
The Productivity Gap  The Rural Market   Productivity growth essential to cater to food requirement Current level of produ...
Agriculture Trend  The Rural Market   <ul><li>Therefore, agricultural productivity expected to improve </li></ul><ul><li>S...
Agri Input Consumption  The Rural Market   <ul><li>India’s Agri input consumption is approx Rs 80,000 cr and is currently ...
Agri Input Consumption  The Rural Market   <ul><li>There is need to, </li></ul><ul><ul><li>Increase Food production </li><...
Rural Household Consumption The Rural Market
Rural Household Consumption  The Rural Market   <ul><li>Rural India is a consumption market of approx. Rs.9700 bn ($230 bn...
Rural Household Consumption  The Rural Market   Per Household spending in Rural India expected to reach current urban leve...
Gaps in the Rural Economy Gaps – Rural Economy
Gaps in the Rural Economy <ul><li>Infrastructure: </li></ul><ul><ul><li>Poor road and telecommunication connectivity </li>...
Gaps in the Rural Economy <ul><li>Demographic Spread </li></ul><ul><ul><li>Population widely dispersed,  disaggregated con...
Gaps in the Rural Economy <ul><li>Market Characteristics: </li></ul><ul><ul><li>Lack of availability and choice </li></ul>...
Gaps in the Rural Economy <ul><li>Agriculture: </li></ul><ul><li>Basic </li></ul><ul><ul><li>Small land holdings (Avg. hol...
Summary - Rural Economy
Summary – Rural Economy <ul><li>Scope & Size:  The rural ecosystem with an income size of  $450 bn and consumption level o...
Hariyali Kisaan Bazaar  Harnessing the potential of rural India
Hariyali Kisaan Bazaar “ Hariyali”  means  “Greenery”  in Hindi  It signifies  “Prosperity in Agriculture” “ Kisaan Bazaar...
Hariyali Concept <ul><li>Focused at increasing rural incomes by providing free agronomy advice and bridging “last mile gap...
Vision and Mission <ul><li>VISION </li></ul><ul><li>To be the leading and trusted  </li></ul><ul><li>Rural Products and Se...
Business Portfolio Agri-Services Hariyali Retail Financial   Services Agri- businesses Agri-inputs Food   &  Grocery Lifes...
Formats <ul><li>Center </li></ul><ul><li>A model rural hub located near large rural agglomerations or highways </li></ul><...
Hariyali - Centers
Hariyali - Stores
Business Extensions <ul><li>Property Related  </li></ul><ul><ul><li>Shop in Shop </li></ul></ul><ul><ul><li>Mall Managemen...
Agri-Services Hariyali’s business portfolio
Agri Services <ul><li>Agri Services are provided as a value added offering  </li></ul><ul><ul><li>Customised advice on spe...
… Hariyali….creating a scalable, viable business having a transformational impact www.dscl.com
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Hariyali - India

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Hariyali - India

  1. 1. HARIYALI KISAAN BAZAAR
  2. 2. INDEX <ul><li>The Rural Market Context </li></ul><ul><li>Gaps in the Rural economy </li></ul><ul><li>Hariyali Business Model </li></ul>
  3. 3. The Rural Market Context <ul><ul><li>The Rural Ecosystem </li></ul></ul><ul><ul><ul><li>Rural Demographics </li></ul></ul></ul><ul><ul><ul><li>Rural Incomes </li></ul></ul></ul><ul><ul><li>Agriculture </li></ul></ul><ul><ul><ul><li>Agriculture Income </li></ul></ul></ul><ul><ul><ul><li>Challenge of Agricultural productivity </li></ul></ul></ul><ul><ul><ul><li>Agriculture Trend </li></ul></ul></ul><ul><ul><ul><li>Agri-Inputs Consumption </li></ul></ul></ul><ul><ul><li>Rural Household Consumption </li></ul></ul>
  4. 4. The Rural Ecosystem The Rural Market
  5. 5. The Rural Ecosystem The Rural Market There is opportunity to participate in the complete rural ecosystem, i.e. both the income and consumption side ( Rural Incomes - $450 bn & Consumption - $ 250 bn ) Agriculture and Allied Activities Harvesting and Agriproduce Marketing Consumption Trading, Warehousing etc. Rural Business Opportunity <ul><li>Agronomy Advise </li></ul><ul><li>Agri-Inputs </li></ul><ul><li>Credit </li></ul><ul><li>Post-Harvest Mgmt </li></ul><ul><li>Market Linkages </li></ul><ul><li>Output Buyer </li></ul><ul><li>Commodity Trading </li></ul><ul><li>Warehousing </li></ul><ul><li>Commodity exchanges </li></ul><ul><li>Consumer Goods </li></ul><ul><li>Household Goods </li></ul><ul><li>Financial Services </li></ul><ul><li>Healthcare </li></ul><ul><li>Education </li></ul>
  6. 6. Rural demographics The Rural Market <ul><li>Rural India supports a population of 790 mn. as of 2005 (70% of India’s population) living in about 600,000 villages distributed as under, </li></ul><ul><li>Even with increasing urbanization and migration, 63% of India’s population is expected to live in rural areas, in 2025. (Abt. 906 mn.) </li></ul><ul><li>Also, 78% of the rural population lives in 35% of the locations. </li></ul>A huge potential in terms of the growing market size (%age) SOURCE: MGI INDIA & NCAER
  7. 7. Rural Incomes The Rural Market <ul><li>Rural India generates an income of Rs. 19000 bn. ($ 450 bn) which is approx 48% of India’s GDP . </li></ul><ul><li>Per capita rural income is growing at the same pace as urban income. </li></ul>Rural India is witnessing robust income growth and the aspirational classes are growing 571 682 790 875 906 SOURCE: MGI INDIA & NCAER
  8. 8. Agriculture The Rural Market
  9. 9. Agriculture Income The Rural Market <ul><li>Agriculture contributes about 37% of the rural GDP (Approx. Rs.6000 bn. ($150 bn)) </li></ul><ul><li>“ Agriculture expected to continue as primary source of income and employment for majority of rural Indians in the foreseeable future’- Mckinsey study. </li></ul><ul><li>Agriculture is expected to grow at 3.1% CAGR over the next two decades as against 2.4% CAGR in the last decade (8.8% in nominal terms) </li></ul>Compound annual growth rate 2.4% 3.1% Agricultural incomes expected to be $250 bn by 2025 SOURCE: MGI INDIA & NCAER
  10. 10. Challenge of Agricultural Productivity The Rural Market Increasing agricultural productivity requires new technology and inputs Source: Economic Survey of India 2007-08 <ul><li>Yield CAGR’s </li></ul><ul><li>Pulses - 0.6% </li></ul><ul><li>Cereals - 1.7% </li></ul><ul><li>Wheat - 0.95% </li></ul><ul><li>Paddy - 1.22% </li></ul><ul><li>Wheat Yield Comparison (kg/Ha) </li></ul><ul><li>India - 2600 </li></ul><ul><li>China – 4300 </li></ul><ul><li>Mexico - 4700 </li></ul><ul><li>UK - 7900 </li></ul><ul><li>World Average - 2900 </li></ul>
  11. 11. The Productivity Gap The Rural Market Productivity growth essential to cater to food requirement Current level of productivity Productivity requirement to meet growing demand Source: Ministry of Agriculture & Cooperation, India
  12. 12. Agriculture Trend The Rural Market <ul><li>Therefore, agricultural productivity expected to improve </li></ul><ul><li>Shift towards higher value added farm activities likely to continue </li></ul>270 486 630 Shift towards value added agriculture and productivity gains expected to increase demand for quality agri-inputs and technology advise SOURCE: NATIONAL ACCOUNTS 2005, MGI INDIA & NCAER
  13. 13. Agri Input Consumption The Rural Market <ul><li>India’s Agri input consumption is approx Rs 80,000 cr and is currently growing at approx 3% </li></ul><ul><li>Key categories like fertilizer, pesticide and seeds have market sizes of Rs 30000 crs, Rs 4100 crs and Rs 5200 crs, growing with 3 %, 3.2 % and 5.7 % CAGR </li></ul><ul><li>As with yield levels, India’s Agri-nutrient consumption per acre is much lower than other countries </li></ul>510 289 198 108 Netherland China Bangladesh India
  14. 14. Agri Input Consumption The Rural Market <ul><li>There is need to, </li></ul><ul><ul><li>Increase Food production </li></ul></ul><ul><ul><li>Shift to value added farming </li></ul></ul><ul><ul><li>Increase agricultural productivity </li></ul></ul><ul><li>Agri-input consumption, is therefore, expected to increase, backed by, </li></ul><ul><ul><li>Better farm produce realizations </li></ul></ul><ul><ul><li>Technical Advisory services. </li></ul></ul><ul><ul><li>Shift towards better seed varieties </li></ul></ul><ul><ul><li>Government initiatives like National Horticulture Mission, Irrigation projects etc. </li></ul></ul><ul><ul><li>Access to institutional credit. </li></ul></ul>As the country takes steps towards more intensive agriculture, the demand for quality inputs and farm technology expected to accelerate
  15. 15. Rural Household Consumption The Rural Market
  16. 16. Rural Household Consumption The Rural Market <ul><li>Rural India is a consumption market of approx. Rs.9700 bn ($230 bn) as of 2005 and is expected to roughly triple by 2025 (Rs26400 bn or $630 bn) (Growing at 4.9% p.a) </li></ul><ul><li>Hence, by 2025, Rural India market is expected to be larger than markets of South Korea, Canada today or 4 times India’s urban market today </li></ul>A very large consumption market dominated by “New to bracket” consumers 450 610 970 1670 2640 SOURCE: MGI INDIA & NCAER
  17. 17. Rural Household Consumption The Rural Market Per Household spending in Rural India expected to reach current urban levels in next ten years SOURCE: MGI INDIA & NCAER
  18. 18. Gaps in the Rural Economy Gaps – Rural Economy
  19. 19. Gaps in the Rural Economy <ul><li>Infrastructure: </li></ul><ul><ul><li>Poor road and telecommunication connectivity </li></ul></ul><ul><ul><li>Lack of reliable electricity and water supplies </li></ul></ul><ul><ul><li>Limited logistics infrastructure & High distribution costs </li></ul></ul><ul><ul><li>The silver lining, however, is, </li></ul></ul><ul><ul><ul><li>About 50% of the population lives in connected districts with reasonable infrastructure. </li></ul></ul></ul><ul><ul><ul><li>Govt. focus on inclusive growth and investment in Infrastructure development i.e. Bharat Nirman Yojana, NREGS </li></ul></ul></ul><ul><ul><ul><li>Private sector also taking steps to build warehousing, logistics & power infrastructure. </li></ul></ul></ul>
  20. 20. Gaps in the Rural Economy <ul><li>Demographic Spread </li></ul><ul><ul><li>Population widely dispersed, disaggregated consumption </li></ul></ul><ul><ul><li>Low per capita spending </li></ul></ul><ul><ul><li>The silver lining, however, is that through the top 20,000 densely populated locations, over 15% of the population in rural can be catered to. </li></ul></ul>Higher costs of servicing rural markets will be a continuing challenge for marketers
  21. 21. Gaps in the Rural Economy <ul><li>Market Characteristics: </li></ul><ul><ul><li>Lack of availability and choice </li></ul></ul><ul><ul><li>Look-alike “Locals” dominate the market. ( Local players in the unorganized sector are able to provide cheaper products) </li></ul></ul><ul><ul><li>Few trusted, national brands ( Limited exposure to the multitude of products in urban India) </li></ul></ul><ul><ul><li>Malpractices – prices higher than MRP, faulty weights and measures, adulteration, consumer schemes not passed on </li></ul></ul><ul><ul><li>Retailers would often misuse their position as the only source of information. </li></ul></ul><ul><ul><li>A poor ‘buying experience’ </li></ul></ul>Inefficient markets with “Basic” service levels. Lack of reliability , trust and choice for the customers
  22. 22. Gaps in the Rural Economy <ul><li>Agriculture: </li></ul><ul><li>Basic </li></ul><ul><ul><li>Small land holdings (Avg. holding 1.5 Ha) </li></ul></ul><ul><ul><li>Investment in Agriculture only 2% of GDP </li></ul></ul><ul><ul><li>Degrading Soil Health </li></ul></ul><ul><ul><li>Depletion of Water Table </li></ul></ul><ul><ul><li>Agriculture Practices </li></ul></ul><ul><ul><li>Repetitive Crop Cycles </li></ul></ul><ul><ul><li>Low yield levels </li></ul></ul><ul><ul><li>Low Input consumption (NPK consumption of 116 kg /Ha against 289 kg/Ha in China) </li></ul></ul><ul><ul><li>Lack of last mile delivery of new agri-technology & practices </li></ul></ul><ul><ul><li>Traditional expensive sources of farm credit (Farmers caught in debt traps) </li></ul></ul><ul><ul><li>Low Farm Mechanization & Non-availability of Irrigation facilities </li></ul></ul><ul><ul><li>Farm produce Marketing </li></ul></ul><ul><ul><li>Dependence on State for disposal of Farm Produce </li></ul></ul><ul><ul><li>Underdeveloped Market Infrastructure </li></ul></ul>Large potential for Agricultural development
  23. 23. Summary - Rural Economy
  24. 24. Summary – Rural Economy <ul><li>Scope & Size: The rural ecosystem with an income size of $450 bn and consumption level of $250 bn offers a large enough opportunity for organized businesses. </li></ul><ul><li>Future growth: Rural household incomes are growing at the same pace as urban and a large consuming class is expected to emerge in the rural areas. </li></ul><ul><li>Market Structure : Rural markets fairly basic in nature. Lack availability, choice, quality products and service levels. High costs of reaching out to rural markets for individual marketers. </li></ul><ul><li>Agriculture: While agriculture is expected to continue as the mainstay of rural population, a much more customized and commercial approach is required to improve productivity levels. </li></ul><ul><li>Last mile gap in Agri-technology: Bridging the last mile gap in Agri-technology is critical to increasing Rural Incomes. </li></ul>The true potential of agriculture and the rural economy can be unlocked, if a business targets to address the key gaps in a commercial and viable manner.
  25. 25. Hariyali Kisaan Bazaar Harnessing the potential of rural India
  26. 26. Hariyali Kisaan Bazaar “ Hariyali” means “Greenery” in Hindi It signifies “Prosperity in Agriculture” “ Kisaan Bazaar” means “Farmer’s market” Hariyali Concept The business is designed to unlock the latent opportunity in rural markets facilitating inclusive growth
  27. 27. Hariyali Concept <ul><li>Focused at increasing rural incomes by providing free agronomy advice and bridging “last mile gap” in technical know-how </li></ul>Developing Strong relationships based on trust, reliability and fairness Leveraging relationships through “one stop shop” retailing and direct sourcing of quality farm produce The Strategic intent of the business is to provide the rural customer with choice, trust, dignity and thus create long-term relationships Value proposition of efficient procurement, improved logistics, strategic pricing and multidimensional dealings with the customers Creating platform between urban and rural
  28. 28. Vision and Mission <ul><li>VISION </li></ul><ul><li>To be the leading and trusted </li></ul><ul><li>Rural Products and Services Enterprise </li></ul><ul><li>MISSION </li></ul><ul><li>We are committed to </li></ul><ul><li>improving the quality of life in Rural India </li></ul><ul><li>by providing superior products and services </li></ul><ul><li>and efficient sourcing of quality agricultural produce </li></ul>
  29. 29. Business Portfolio Agri-Services Hariyali Retail Financial Services Agri- businesses Agri-inputs Food & Grocery Lifestyle Household Fuel Insurance Banking Others F&V Commodity Trading Seeds Warehousing Milk Cattle feed
  30. 30. Formats <ul><li>Center </li></ul><ul><li>A model rural hub located near large rural agglomerations or highways </li></ul><ul><li>Focused on all retail and agri businesses </li></ul><ul><li>Format that encompasses Agri-services, One-stop-retail-shop, Sourcing, Banking services, Fuel station and Recreation areas </li></ul><ul><li>Spread over owned 4 acre campus </li></ul><ul><li>Retail space of 15-20K sqft. </li></ul><ul><li>Store </li></ul><ul><li>Located in the marketplace of small towns </li></ul><ul><li>Focused mainly on retail businesses </li></ul><ul><li>Convenience format encompassing agri-services and retail of select categories </li></ul><ul><li>Compact space of 4K-5K sq. ft retailing agri-inputs and FMCG </li></ul>Penetrating markets through appropriate formats
  31. 31. Hariyali - Centers
  32. 32. Hariyali - Stores
  33. 33. Business Extensions <ul><li>Property Related </li></ul><ul><ul><li>Shop in Shop </li></ul></ul><ul><ul><li>Mall Management </li></ul></ul><ul><ul><li>Extra Land Holdings </li></ul></ul><ul><li>Business Integration </li></ul><ul><ul><li>Retail </li></ul></ul><ul><ul><ul><li>Cash & Carry Business </li></ul></ul></ul><ul><ul><ul><li>Merchandise Outlets in Tier 4 cities </li></ul></ul></ul><ul><ul><li>Financial Services – NBFC / Microfinance </li></ul></ul><ul><ul><li>Trading – Processing of Dals /Spices </li></ul></ul><ul><ul><li>Milk – Dairy Business </li></ul></ul><ul><ul><li>Integrated Food Supplier </li></ul></ul>
  34. 34. Agri-Services Hariyali’s business portfolio
  35. 35. Agri Services <ul><li>Agri Services are provided as a value added offering </li></ul><ul><ul><li>Customised advice on specific opportunities/ problems </li></ul></ul><ul><ul><li>Farm Visits by Agronomists for giving Technical Advice </li></ul></ul><ul><ul><li>Field demonstrations for propagating best practices </li></ul></ul><ul><ul><li>Agronomy Seminars along with experts for last mile delivery of best practices </li></ul></ul><ul><ul><li>Soil and water test based recommendations </li></ul></ul><ul><li>Agri Services is directed at improving farmer’s productivity and income levels. </li></ul><ul><li>Dedicated qualified agronomists offer unbiased guidance thus building quick rapport with the farmers of the area. </li></ul><ul><li>Wide networking with National / International Agri Institutes like CIMMYT, IRRI, University of Adelaide for Knowledge Management and dissemination of best practices </li></ul><ul><li>Creates long term relationship with the farmers. </li></ul><ul><li>Serves as a foundation for Hariyali’s Retail, Financial & Agribusinesses </li></ul>
  36. 36. … Hariyali….creating a scalable, viable business having a transformational impact www.dscl.com

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