<ul><li>Our Vision  </li></ul><ul><li>Bring  people  together through creative use of  technology platforms ('connecting t...
<ul><li>Matchbox Solutions </li></ul><ul><li>eFarm </li></ul>Sahee jawaab : None of the above !  An  eBay   for   Farmers ...
<ul><li>Pure corporates – Failing on greed and personal egos </li></ul><ul><li>Pure govt. initiatives – Failing on corrupt...
<ul><li>The actual demand and supply data for any produce  (which is MOST  fundamental to any sustainable business) is not...
<ul><li>End buyers – High prices, Poor quality </li></ul><ul><li>Lorry drivers – The missing link </li></ul><ul><li>Small ...
<ul><li><A video> </li></ul>
<ul><li>There is no ‘single’ entity owning responsibility of entire chain </li></ul><ul><li>The systems are usually  close...
<ul><li>Farmer’s market – Utopian vision but Unrealistic </li></ul><ul><li>Loan waivers – Insult to Injury </li></ul><ul><...
<ul><li>A ‘ click and mortar ’ entity with primarily : </li></ul><ul><ul><li>A B2B technology platform which forms the cor...
Farmers Cooperatives Collection centers Village ICT kiosks Phone booths Mobile operators Storage Warehouses Value added re...
<ul><li><A  slideshow/video  of operations> </li></ul>
<ul><li>NO   </li></ul><ul><li>Organised retail penetration less than 2% </li></ul><ul><li>Local street side vendors/push ...
<ul><li>Demand Supply prediction – In a constrained situation </li></ul><ul><li>Current examples – Train, bus, movie ticke...
<ul><li>YES ! But with a BIG PLUS points </li></ul><ul><li>Examples of “System” as a middleman </li></ul><ul><ul><li>Marri...
<ul><li>Prices are arrived at based on  fair negotiations and in advance  </li></ul><ul><li>All grades (High/Medium/Low) p...
<ul><li>For bulk buyers :  </li></ul><ul><li>Collapsing multiple middlemen improves efficiency and accountability </li></u...
<ul><li>“ Gabbar singh kehkar gaya  </li></ul><ul><li>Jo dar gayaa , Who Mar Gayaa ” </li></ul><ul><li>Reality : </li></ul...
<ul><li>Value added resellers </li></ul><ul><li>Intermediaries – Sorting, Grading, Packing, Transporting </li></ul><ul><li...
<ul><li>Quick calculation  : </li></ul><ul><ul><li>Chennai population : 8 million </li></ul></ul><ul><ul><li>Avg. consumpt...
<ul><li>Only core operations are directly staffed </li></ul><ul><li>Rest through  entrepreneurs , self help groups </li></ul>
<ul><li><web pages in slides> </li></ul>
<ul><li>Pilot completed  </li></ul><ul><li>Retail operations using mobile trucks </li></ul><ul><li>8 tonnes per month </li...
Phase I : Pilot  (Status – Completed)  Aug 15 to Oct 15 Thiruvanmiyur, Valmiki Nagar (Chennai) Volume : 2 tonnes per week ...
<ul><li>People issues  : </li></ul><ul><li>Agri industry has been on a slow/negative growth .  </li></ul><ul><li>Both farm...
<ul><li>Percentage on each transaction made (~10%),  </li></ul><ul><li>User Registration fees and database listing  </li><...
Year 1 Year 2
 
<ul><li>“ Socially conscious” Investor </li></ul><ul><li>Domain expertise and network </li></ul><ul><li>Talk in Rupees and...
<ul><li>TATA NEN Hottest startups : </li></ul><ul><ul><li>Judges and public feedback </li></ul></ul><ul><li>Repeat custome...
<ul><li>High end produce – Organics ( O 4 ) </li></ul><ul><li>Pricing study  </li></ul><ul><li>Standardised collection/bag...
<ul><li>Building  volume  & scale on buyer side </li></ul><ul><li>Self help groups – issues </li></ul>
<ul><li>Venky </li></ul><ul><li>venky@matchboxsolutions.in  </li></ul><ul><li>Valli </li></ul><ul><li>[email_address] </li...
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Dissecting A Startup : EFarm - Innovations in the Farm-to-Home Supply Chain

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A presentation made by eFarm's founders at IFMR/ICAAP Chennai, India on Feb 24th 2009. The talk centred on 2 themes - a behind the scenes look of a operational startup and typical journey taken . Secondly it was centred on agri supply chain issues in India and how eFarm is specifically filling the gaps.

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Dissecting A Startup : EFarm - Innovations in the Farm-to-Home Supply Chain

  1. 2. <ul><li>Our Vision </li></ul><ul><li>Bring  people  together through creative use of  technology platforms ('connecting the dots' ) to form  socio-economic-webs </li></ul><ul><li>Create successful entrepreneurial, social enterprises which are profitable and sustainable </li></ul><ul><li>Make corporate social responsibility our core business model and differentiator </li></ul><ul><li>Measure success not just in financial growth , but also in the social growth in the areas we serve </li></ul><ul><li>Management </li></ul><ul><ul><li>Venkata Subramanian Founder & Managing Director: </li></ul></ul><ul><ul><ul><li>MS (Computer Science), University at Albany, NY , B.Arch , IIT Kharagpur (1995) , India </li></ul></ul></ul><ul><ul><ul><li>12 years of experience in IT industry , lead key accounts in BFSI for Wipro, Satyam in USA. Very strong expertise in analysis & design of complex systems , portal development , back office operations. </li></ul></ul></ul><ul><ul><ul><li>Responsible for overall strategy , technology and public relations </li></ul></ul></ul><ul><ul><li>CEO : Srivalli </li></ul></ul><ul><ul><ul><li>MBA , B.Com Taxation </li></ul></ul></ul><ul><ul><ul><li>8 years experience in Sales, Marketing, & Operations. Has run two start-ups and organised fund raising for NGOs as part of CSR programs. </li></ul></ul></ul><ul><ul><ul><li>Responsible for operations, business development, finance, administration </li></ul></ul></ul><ul><ul><li>Manager, Sourcing & Logistics : Sankara Krishnan </li></ul></ul><ul><ul><ul><li>Over 35 years of Hands on experience in logistics & rural entrepreneurship </li></ul></ul></ul><ul><ul><ul><li>Extensive practical experience in trucking operations, farming, rural businesses </li></ul></ul></ul><ul><ul><ul><li>Responsible for sourcing, transportation, delivery </li></ul></ul></ul><ul><ul><li>Manager , Customer Relations : Yamuna </li></ul></ul><ul><ul><ul><li>M.Phil , M.A , B.Ed, B.Sc </li></ul></ul></ul><ul><ul><ul><li>Retired head from Doordarshan Kendra, Chennai </li></ul></ul></ul><ul><ul><ul><li>Over 35 years experience in media , public relations, heading public sector organization </li></ul></ul></ul><ul><ul><li>Consultants and advisors from leading agricultural universities, management schools, government and industry </li></ul></ul>Combination of different background ,skills and experience to provide creative perspectives to solving key problems
  2. 3. <ul><li>Matchbox Solutions </li></ul><ul><li>eFarm </li></ul>Sahee jawaab : None of the above ! An eBay for Farmers !?
  3. 4. <ul><li>Pure corporates – Failing on greed and personal egos </li></ul><ul><li>Pure govt. initiatives – Failing on corruption & bureaCRAZY </li></ul><ul><li>Pure NGO/NPO – Driven by passion, but lack sustainability and governance </li></ul><ul><li>Working for a social cause DOES NOT MEAN we need to be making LOSS The middle path : Social + Business goals </li></ul><ul><li>The middle path : Social + Business goals </li></ul>
  4. 5. <ul><li>The actual demand and supply data for any produce (which is MOST fundamental to any sustainable business) is not reliable /accurate , leading to over production and wrong crop selection. </li></ul><ul><li>Price discovery through auctions or local mandis are an eye-wash </li></ul><ul><li>Bagging/packing of produce is not standardized, </li></ul><ul><li>Too many middlemen, too little value addition – Resulting in High wastage (over 40%), black marketing and price escalations of over 300% </li></ul><ul><li>Transportation handled by independent truckers who also operate through brokers </li></ul><ul><li>Several existing storages and cold rooms under utilized </li></ul><ul><li>There is little or no IT usage/Post harvest science </li></ul>
  5. 6. <ul><li>End buyers – High prices, Poor quality </li></ul><ul><li>Lorry drivers – The missing link </li></ul><ul><li>Small retailers – Bullied out, Ignored , Slumdogs ? </li></ul>
  6. 7. <ul><li><A video> </li></ul>
  7. 8. <ul><li>There is no ‘single’ entity owning responsibility of entire chain </li></ul><ul><li>The systems are usually closed, vendor specific or too complex that predominantly it’s reach and volume is limited </li></ul><ul><li>They cater only to the top 5% of the income/social bracket , and that too in metros. Hence the effects aren’t felt at the ‘bottom of the pyramid’. </li></ul><ul><li>In some cases, it has resulted in a David v/s Goliath fight where the large retailers are trying to completely by-pass existing traders and small time vendors, leading to stiff resistance and negativity </li></ul><ul><li>Big investments made . But Recession has hit retail </li></ul>
  8. 9. <ul><li>Farmer’s market – Utopian vision but Unrealistic </li></ul><ul><li>Loan waivers – Insult to Injury </li></ul><ul><li>Frequent changes in administration & executives derail plans </li></ul><ul><li>Foreign funds & agencies – vested interests </li></ul>
  9. 10. <ul><li>A ‘ click and mortar ’ entity with primarily : </li></ul><ul><ul><li>A B2B technology platform which forms the core of the system (like eBay, alibaba) and </li></ul></ul><ul><ul><li>A distribution, fulfillment system which blends well to the vagaries of Indian conditions (Dubbawallahs, Shakti, Amway) </li></ul></ul><ul><ul><li>A ‘glue’ between the various stakeholders in the system, the ‘network’ IS the company </li></ul></ul><ul><ul><li>Setup a level playing field. </li></ul></ul><ul><ul><li>Don’t compete with any of the existing players nor become a threat to anyone’s livelihood. </li></ul></ul>
  10. 11. Farmers Cooperatives Collection centers Village ICT kiosks Phone booths Mobile operators Storage Warehouses Value added resellers Sorting , Grading , Processing, Packing Small Independent transporters Intra-city small tempos Kiranas Self Help Groups Hawkers eFarm Bulk buyers Exporters Logistics Fleet operators
  11. 12. <ul><li><A slideshow/video of operations> </li></ul>
  12. 13. <ul><li>NO </li></ul><ul><li>Organised retail penetration less than 2% </li></ul><ul><li>Local street side vendors/push carts have last mile connectivity to customer </li></ul>
  13. 14. <ul><li>Demand Supply prediction – In a constrained situation </li></ul><ul><li>Current examples – Train, bus, movie tickets </li></ul><ul><li>Gradual change in mindset – From walkin,to phone-in, to paper, to email to online forms </li></ul>
  14. 15. <ul><li>YES ! But with a BIG PLUS points </li></ul><ul><li>Examples of “System” as a middleman </li></ul><ul><ul><li>Marriage market : broker v/s Bharathmatrimony </li></ul></ul><ul><ul><li>Travel booking : Agents v/s Yatra.com,IRCTC </li></ul></ul>
  15. 16. <ul><li>Prices are arrived at based on fair negotiations and in advance </li></ul><ul><li>All grades (High/Medium/Low) produce is picked at different rates and matched with suitable end customer preferences </li></ul><ul><li>By reducing wastage across the chain , farmer gets price from more quantity sold </li></ul><ul><li>Pick-up is done from farm or from local collection centers , reducing transportation costs to farmer </li></ul><ul><li>Payments are made in full upon delivery , through transparent means with proper paper bills </li></ul><ul><li>Data about current demand, price levels, buyer preferences, projected volumes available for aiding in planning phase </li></ul>
  16. 17. <ul><li>For bulk buyers : </li></ul><ul><li>Collapsing multiple middlemen improves efficiency and accountability </li></ul><ul><li>Assured availability, quality, less price fluctuations </li></ul><ul><li>Less wastage owing to pre-sorting </li></ul><ul><li>For retail buyers : </li></ul><ul><li>Farm fresh quality at reasonable prices (about 20% cheaper on avg) </li></ul><ul><li>A trust worthy, safe , honest place to shop </li></ul>
  17. 18. <ul><li>“ Gabbar singh kehkar gaya </li></ul><ul><li>Jo dar gayaa , Who Mar Gayaa ” </li></ul><ul><li>Reality : </li></ul><ul><li>Only brokers/agents make money </li></ul><ul><li>High risk game, Uncertainty across chain </li></ul><ul><li>Value addition brings more revenue for everyone </li></ul>
  18. 19. <ul><li>Value added resellers </li></ul><ul><li>Intermediaries – Sorting, Grading, Packing, Transporting </li></ul><ul><li>Storage – Dry / Cold </li></ul><ul><li>Processing – juices, extracts, powders </li></ul><ul><li>Distributors </li></ul><ul><li>Retailers – many formats </li></ul>
  19. 20. <ul><li>Quick calculation : </li></ul><ul><ul><li>Chennai population : 8 million </li></ul></ul><ul><ul><li>Avg. consumption : 250 gms </li></ul></ul><ul><ul><li>Volume : 2000 tonnes (400 lorries inflow Koyambedu) </li></ul></ul><ul><ul><li>Value : 3 crores per day </li></ul></ul><ul><ul><li>1% penetration </li></ul></ul><ul><ul><ul><li>= 3 lakhs T.O. per day = 9 crores per annum </li></ul></ul></ul>
  20. 21. <ul><li>Only core operations are directly staffed </li></ul><ul><li>Rest through entrepreneurs , self help groups </li></ul>
  21. 22. <ul><li><web pages in slides> </li></ul>
  22. 23. <ul><li>Pilot completed </li></ul><ul><li>Retail operations using mobile trucks </li></ul><ul><li>8 tonnes per month </li></ul><ul><li>10 member core team , 10+ advisors , 100+ extended team </li></ul>
  23. 24. Phase I : Pilot (Status – Completed) Aug 15 to Oct 15 Thiruvanmiyur, Valmiki Nagar (Chennai) Volume : 2 tonnes per week , Turnover = Rs 30000/week Goal : Road test of the concept in immediate vicinity, capture detailed lessons learnt and feedback, achieve break even Phase II : Stabilisation (Status – In progress) Oct 15 2008 to Mar 15 2009 Across 5 sample neighbourhoods Volume target : 4 tonnes per day , per locality Turnover target : Rs 75000 per day, per locality Goal : Regularise operations, Identify and fix gaps, Demonstration-cum-training centre in base of all wholesale/retail activities, Data analysis and systems enhancements. Phase III : Growth– Mar 15 2009 to Dec 15 2010 Goal : Metro wide growth (Chennai), Deeper sourcing channels, hub and spoke operation in Tier II cities Phase IV : Expansion (2011 – 2013) Goal : Expand to other metros/regions , Cross region sourcing & delivery
  24. 25. <ul><li>People issues : </li></ul><ul><li>Agri industry has been on a slow/negative growth . </li></ul><ul><li>Both farmers and end retailers want to quit </li></ul><ul><li>Initial adoption and understanding amongst the buyer community may be slow </li></ul><ul><li>Finance issues : </li></ul><ul><li>Payments and Collections. </li></ul><ul><li>Environmental issues : </li></ul><ul><li>Weather, calamities affect sourcing </li></ul>
  25. 26. <ul><li>Percentage on each transaction made (~10%), </li></ul><ul><li>User Registration fees and database listing </li></ul><ul><li>Franchisee fees for retailers (Based on typical daily order volume) , </li></ul><ul><li>Training </li></ul><ul><li>Systems integration /consulting </li></ul><ul><li>Advertisements in retail vans/push carts/web portal </li></ul>
  26. 27. Year 1 Year 2
  27. 29. <ul><li>“ Socially conscious” Investor </li></ul><ul><li>Domain expertise and network </li></ul><ul><li>Talk in Rupees and not Dollars ;-) </li></ul><ul><li>Be a ‘team member’ not JUST a ‘share holder’ </li></ul>
  28. 30. <ul><li>TATA NEN Hottest startups : </li></ul><ul><ul><li>Judges and public feedback </li></ul></ul><ul><li>Repeat customers, Referrals </li></ul><ul><li>Investor interest </li></ul><ul><li>Press coverage – NDTV , Hindu, startups.in, Kumudham </li></ul>
  29. 31. <ul><li>High end produce – Organics ( O 4 ) </li></ul><ul><li>Pricing study </li></ul><ul><li>Standardised collection/bagging </li></ul><ul><li>Processed food items </li></ul>
  30. 32. <ul><li>Building volume & scale on buyer side </li></ul><ul><li>Self help groups – issues </li></ul>
  31. 33. <ul><li>Venky </li></ul><ul><li>venky@matchboxsolutions.in </li></ul><ul><li>Valli </li></ul><ul><li>[email_address] </li></ul>

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