While technology is a major driver of innovation, all changes are not based on technology alone. The role of organization and entrepreneurship is equally, if not more important. Sometimes this point is missed in the ‘technology-driven ‘seminars and workshops which basically seek fiscal concessions to buttress investments in the sector, in the fond belief that ‘higher the investments in technology… the higher will be thru returns’. However, as the Samriddhii story shows, there are many other ways to achieve the objectives of reducing wastages at every level, cutting down the intermediation costs, and ensuring equity among all stakeholders: producers, vendors and the consumers.
The statement often made in the most seminars or meetings on agriculture marketing is that 40 per cent of fruits and vegetables are wasted in India. What is interesting is that the same statement has been repeated for the last ten years, which means it is status quo in wastages in F&V. The solutions offered to reduce wastages range from investments in cold storages, refeer transportation systems to the state of art wholesale and terminal markets. Unfortunately, there seems to be a lukewarm response from the private sector due to variety of reasons such as non-viability of high capital investments and poor policy APMC environment.
The story of Kaushalendra, an IIM-A graduate and an Asoka Foundation Fellow, might be a source of inspiration of all the policy planners and companies in reducing wastage in F&V in a low cost manner. Kaushlendra and group of his friends started an organization by name Samriddhii in Patna, Bihar two years back, which mainly works with vegetable farmers and vegetable vendors in streamlining the supply chain. They were successful in bringing down the wastages in fruits and vegetables to mere 2-5 per cent of the total produce handled, right from the farm to vegetable vendor. It uses no cold chain technologies to achieve these efficiencies.
What Samriddhii did was no rocket science, but mere understanding the various stakeholders in the entire chain and providing improvised solutions. Kaushlendra says that most often vegetables vendors are blamed for higher prices but no one empathizes with them for losses that they have bear every day in terms of unsold vegetables. Samriddhii worked closely with the vegetable vendors in understanding their daily requirement, time of sales and carry over stock at the end of day, etc. On the backend, Samriddhii similarly works with farmers in improving their production, collection, aggregation and transportation to cities.
Samriddhii Grameena Kendra’s are the collection centres in villages, where the farmers harvest arrives around 06.00 a.m. in the morning. Farmers themselves are involved in primary grading and sorting of the produce at these Grameena Kendra’s. The produce then moves to Samriddhii pack houses in the consumption centers by noon. The produce is then graded into three different grades i.e. A-grade for direct marketing to consumers, B-grade for food processors and C-grade for institutional sales such as hotels and hostels in the city. All the produce is completely packed into various packets with bar codes. The bar code contains traceability information such as farmers name, village, date and time of harvest.
Vegetable vendors usually sell vegetables in the evening from 04.00 p.m. to 09.00 p.m. in the evening. Therefore, supplies from Samriddhii pack house reach vegetable vendors reach vendors well before 04.00 p.m. in the evening. All the Samriddhii vendors sell pre-packed vegetables of 0.5 kg to 02 kgs depending on the category and season. This small innovation has led to considerable saving in time and value for vegetable vendors. At the end of the day, Samriddhii again collects the unsold vegetables from these vendors and supplies the same to institutions such as hotels and hostels.
Kaushlendra says that the art of vegetable marketing lies in efficiency to reduce to time between harvest at farm and purchase by consumer. Samriddhii provides better prices for farmers, ensures higher incomes for vegetable vendors and quality vegetables to consumers at lower prices. Infusing efficiency at every stage did the trick for Samriddhii and its stakeholders.
Can Corporates learn lessons from this story?
The key to reducing wastages in fruits and vegetables would be to develop thousands of Kaushlendras all over India. Corporates could actually leverage the skills of such micro entrepreneurs to meet their needs for retail stores. While the corporates could focus on front end sale, Kaushlendra’s model can focus on backend and ensure supplies with efficiency.
Kaushalendra was invited to make presentations to the Round table on Agri marketing organized by FICCI, Nafed and SFAC in March this year, and to all the Mission Directors of the State Horticulture Missions last fortnight. Several state governments are now coming forward to adopt this idea, and work in partnership with his group. This has also encouraged other aggregators to look at this model which makes the vendor an integral part of the value chain, and does not wish her away. One has to be sensitive legitimate fears and apprehensions about the impact of corporate investments on livelihoods of the vendors, and this model offers a win-win situation for all. It should therefore be possible for the larger chain stores to provide these vending carts to the existing vegetable vendors, and leverage their knowledge of customer needs and expectations with their back –end value propositions.
Kaushalendra makes it a point to focus on what is not required for a modern value chain in vegetables. Big cold chambers for vegetables are not required as ‘the fresher the vegetable, the better it is.’ The need is to establish small cold chambers at the farmers field, with a capacity of 8-10 Mts and which can maintain the temperatures between 10-20 degrees only He also stresses the need to have legitimate vending spaces in cities, and to give dignity and protection to the vendor, who is more a victim of his circumstances, rather than an active player in the supply chain. For him the new channels will be the ‘modern push carts with cooling devices’, and ‘temperature controlled panels at the kirana stores’.
The National vegetable Initiative being launched in all metros and state capitals can surely draw inspiration from this model.
(With inputs from Bhaskar Reddy, Head, Agri &RD, FICCI, and New Delhi)