E Business Operations

ITC-e chaupal
Presented By
Pankaj Murudkar [063] Vinay Nadar [064] Sachin Bajaj [066

]

Introduction
• India is second most populated country in the world. • Agriculture is the backbone of Indian economy. • It contributes around 26% of the total GDP.

•Agriculture provides livelihood to about 65% of the labour

force and accounts for 8.56% of India's exports.

•The fragmented farms are constraining the risk taking ability

of Indian farmer locking him up into a vicious cycle of :

low risk taking ability, low investment, low productivity, weak market orientation, low value addition, low Margin, low risk taking ability.

Low Risk Appetite Low Margins Caught in a vicious cycle of underdevelopment Low Investment Low Value Addition Weak Market Orientation Low Productivity .

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whatever the price is… Middlemen extract high transaction fee. since there is no other option for the farmer INPUT PURCHASE : Exactly the reverse of the above situation. By then he has already travelled 30 km out of his village Sunk costs put pressure to sell. Information and Knowledge not available when he wants to transact .OUTPUT SALES : Price Information is available only when the farmer is ready to transact. but again to farmers disadvantage.

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Personal Care. ITC has a diversified presence in Cigarettes. Safety Matches and other FMCG products. Packaged Foods & Confectionery. AgriBusiness. Currently headed by – Yogesh Chander Deveshwar Number of Employees – 26000 Revenues – US $ 7 bn. Stationery. It’s a public conglomerate company headquartered in     Kolkata. Branded Apparel. . Packaging. Hotels. Paperboards & Specialty Papers. Information Technology.

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. Idea Generation  The idea of creating and leveraging an electronic market place came from the brainstorming session done by senior executives of ITC-IBD. e-choupal is a Hindi word which means “village meeting place”. Market is a meeting place where vendors and customers come together to do transactions. e-choupal is a virtual market place where farmers can transact directly with a processor and can realize better price for their produce.

The eChoupal Infrastructure Tier 1 : An ICT kiosk with Internet Access • In the house of a trained farmer Sanchalak • Within walking distance of target farmers • Additional investments in Solar Power & VSATs to overcome weak infrastructure .

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The eChoupal Services  Relevant & Real time Information . News  Customized Knowledge . Health & crop Insurance .Commodity prices. Local Weather.Lower Transaction costs. better Value through Traceability  Supply Chain for Farm Inputs -Screened for Quality. Risk Management  Direct Marketing Channel for Farm Produce .Farm Management. Demand Aggregation for Competitive Prices & Efficient Logistics  Education  Financial Services – Life General.

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assesses quality and gives farmer a conditional quote and a note (name/village/quality tests/approx.Pricing Inbound Logistics Inspection Grading Weighing and Payment Hub Logistics Technolog ical support  Pricing  Previous day’s closing price used as benchmark price for next day  Mandi prices communicated to sanchalak through e-Choupal portal  Sanchalak inspects the sample. quantity/conditional price). if farmer decides to sell to ITC .

others are purely warehouse operations  ITC’s aim is to have a processing centre within 30-40 km radius of its farmers .Pricing Inbound Logistics Inspection Grading Weighing and Payment Hub Logistics Technolog ical support  Inbound Logistics  Farmer proceeds to the nearest ITC procurement hub with the note  Some procurement hubs are ITC factories.

laboratory tests are conducted on a sample of farmer’s produce  To change farmer’s attitude and appreciating produce quality.Pricing Inbound Logistics Inspectio n Grading Weighing and Payment Hub Logistics Technolo gical support  Inspection and Grading  At the ITC procurement hub. ITC is developing lab tests to reward farmers with reward points for better quality supply .

Pricing Inbound Logistics Inspectio n Grading Weighing and Payment Hub Logistics Technolo gical support  Weighing and Payment  Farmer’s produce is weighed on electronic weighbridge  He is then given full cash payment  Freight expenses are reimbursed  Appropriate documentation at each stage and farmer is given a copy of that  Samyojaks handle cash operations .

Pricing Inbound Logistics Inspectio n Grading Weighing and Payment Hub Logistics Technolo gical support  Hub Logistics  Farmer transports his produce to the nearest processing centre or storage hub  ITC incurs the transportation cost  The farmer bears the risk of transportation until produce is delivered and the sale is completed .

000 personalized business function points 110. e-choupal &rural distribution 24. Insurance. Aqua Processing & Commodity blending Support for 8 local languages .Pricing Inbound Logistics Inspectio n Grading Weighing and Payment Hub Logistics Technological support  Technological support  Nodal platform catering to commodity blending. e-Choupal Management. Rural Distribution. agricultural     trading. Exports.000+ pre-built business function points Integrated Business Systems for Direct Agriculture Procurement.

Freedom Of Information .Information & Knowledge is free of cost . the shareholders look for a competitive return 2.1.Farmers are free to sell their products any where 3. Freedom Of Transaction .No salary paid to Sanchalaks – a commission based model . Entrepreneurship .No Initial investment of the Sanchalak -Not subsidized .Govt does not pay.

What’s in it for ITC ? What’s in it for farmer? What’s in it for Customer?  Increased Yield  Better Supply chain for ITC’s Food & Agri Businesses  Better Quality Food & Agri Products  Access to the Undeserved Rural Markets  Improved Quality  Low cost as compared to other competitors  New ITES Business Opportunities  Reduction in Transaction Costs  Low shelf life agri products are available for the maximum time  Shareholder Value through  Real Time Information despite distances Serving Society  Elimination of non value added activities .

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•Low Cost Last Mile  Distribution at low cost Wide reach in Rural India High Credibility – Increased product penetration Right prices to consumers Continuous Visibility/Availability •Intelligent Fast Mile Sharply Targets Customers Product Endorsement Education or product usage and benefits Brand Building at low cost Superior understanding of rural consumers •Football to Business High Quality of Products and Services Right Prices Shopping environment .

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