Ethics & Value Based Leadership

ECHOUPAL
AN ITC INITIATIVE
ITC ECHOUPAL : AN OVERVIEW

Farmers Mandi Commission

ITC
Agent

• Soyabean Farmers of • Government run hubs to • Government-licensed • Private Companies who

Madhya Pradesh sell farmer’s produce buyers bidding for the contracted CAs in each
farmer’s produce mandi to bid for them

“Choupal” is an age-old tradition in Indian villages. Villagers gather at a common place, typically a ‘chowk’ or common room of
someone’s home and chat, gossip, or share stories and news from the day. It provides a platform for the villagers to share their
experience, wisdom with their community.
ITC’s motivation for creating the eChoupal

IBD of ITC was lagging behind the other division of the company

Creating a sourcing network with direct links to the

1
farmers in rural areas.

2 Limited Technical Resources

3 No access to quality inputs and accurate weather

reports

4 Middlemen involvement
What were the old and new physical flows and information flows in the
channel?
Before eChoupal :

1 Village  Mandi  Factory : Farmers had to travel huge distances to sell their produce

Word of mouth
information : Lack of telecommunication made it hard for
transfer
2

3 Monetary flow not immediate : CAs sometimes pay farmers after an unofficial credit period

After eChoupal :

1 Village  Hub  Factory : ITC Hubs within driving distance for all farmers

2 Computer kit, telephone and internet connection : Web kiosks within walkable distance

3 Ready availability of relevant information : Weather Info, Market price, Best practices

4 Immediate cash payment : Cash reserves kept in secure kiosks at processing plants
Major obstacles in implementing this initiative

Government restrictions on the agricultural transactions to be limited to

mandis

Farmers found the open auction at Mandis more attractive

Training Samyojaks and Sanchalaks on new technologies

Limited capacity of the hubs

Non affordability of “Samyojaks” to work solely at ITC

Long distances to be covered by farmers to reach for hubs

Hubs outnumbered by mandis

What made this implementation possible? Identify specific factors that helped
in this decision and its implementation.
Partnering ITC with 37 companies & state govt. 30,000 villages across six states

• Comprehensive knowledge of rural markets- • Selection of Sanchalak - Both the selection of

Use of local population, as much as possible helped the
Sanchalak and the acceptance of Sanchalak by the
network to get the acceptance closely
community are critical for the success of e-choupal

• Designing a Win-Win transaction model- Both
the farmer and the processor share the benefits, eliminating
middlemen
• Evolving an appropriate user interface- e-Choupal
evolved a simple interfacing arrangement that a farmer can
understand.

• Leveraging the logistics channels-e-choupal uses

the local institutions but eliminates the information
• Bottom-up model for entrepreneurship- The
asymmetry that they used previously farmer and Sanchalak are free to use the e-choupal
and develop new uses.

ITC's e-Choupal boosts farmers' income by 50% with direct sourcing