itc echoupal
TRANSCRIPT
ASHISH ATREY
The ITC Group is one of the India’s largest private sector companies with a market capitalization of approximately US $ 4 billion and annual sales of US $ 2billion.
ITC has a diversified presence in cigarettes, hotels, paperboards, specialty papers, packaging, agricultural products, branded apparel, packaged foods &
The International Business Division (IBD) of ITC, started in 1990, exports agricultural commodities such as soybean meal, rice food grains (basmati &non basmati), wheat & wheat products, lentils, and coffee
Problem faced by ITC IBD
Lack of Quality product for export business
Cost of product was high due to intermediaries
Delay in supply
No direct link between farmer and company
Agri In
put R
eta
iler
Farmer
Pro
cessor
Kaccha
Adat
Pakka
Adat
Money Lender
Trader
Bro
ker
Dept o
f Agri V
LW
InputCos
SeedFertilizersChemicalsPractices
Sto
ckie
st
GovtUniv.
Met DepMSP
InsurancePracticesWeather
Steps taken by management
PLANNING•FROM THE BRAINSTORMING SESSION CONDUCTED BY, ITC-IBD SENIOR EXECUTIVE, CONCEPT OF E-CHOUPAL EMERGED.•WANT A WIN-WIN SOLUTION FOR BOTH COMPANY AND FARMERS
Agri In
put R
eta
iler
Farmer
Pro
cessor
Kaccha
Adat
Money Lender
Trader
Bro
ker
Dept o
f Agri V
LW
Input
Cos
Seed
Fertilizers
Chemicals
Practices
Sto
ckist
Govt
Univ.
Met Dep
MSP
Insurance
Practices
Weather
Choupal
Sanchalak
ORGANIZING
Problem of power supply is overcome by solution like solar energy.
Infrastructure.Connectivity problem was solved by upgrading BSNL
exchanges with RNS kits, Mobile Choupals,24x7 helpdesk etc.
Power
Connectivity
STAFFINGLocal leadership developmentTraining of sanchalakLocal participation
SANCHALAK
CONTROLLINGE-choupal is a centralized concept where all the
control remain in the hands of company.Itc has commission based salary to control the activity
of SANCHALAK
The Mandi Chain
Farmer Incurs
Trolley Freight to Mandi = 100Filling & Weighing Labour= 70Labour Khadi Karai = 50Handling Loss = 50
Rs per MT
270
ProcessorIncurs
Commission to Agent = 100Cost of Gunny Bags (net) = 75Labour (Stitching, Loading)= 35Labour at Factory (Unload)= 35Freight to Factory= 250Transit Losses = 10
505
Total Chain 775 V V2
The eChoupal Chain
Farmer IncursTrolley Freight to Mandi = 100Filling & Weighing Labour
= 70Labour Khadi Karai = 50Handling Loss = 50
Rs per MT
270
ProcessorIncurs
Sanchalak = 50Commission to Agent = 100Cost of Gunny Bags (net) = 75Labour (Stitching, Loading) = 35Labour at Factory (Unload) = 35Freight to Factory 100 = 250Transit Losses = 10
505
Total Chain775185
185
e-Choupal Now
States covered 10
Villages covered 40,000
No. of e-Choupals 6,500
Farmers e-empowered 4 million
ACHIEVEMENTS
.
Swot AnalysisSTRENGTH1) Local leadership2) Transparency in transaction3) Sanchalaks are selected carefully4) Flows of funds to the real owner5) Able to design a win-win model6) Bottom up model for entrepreneurship7) Real time information..WEAKNESS1) Difficulty in establishing e-choupal in new areas as it is not that easy task2) Value chains of different crops different problem.3) Implement & expanding of e-choupal
OPPORTUNITY1) Huge scope in other developing and underdeveloped countries.2) Entering in new products like coffee, aquaculture and wheat in other states.3) Opening up entirely new and more effective channels for distribution and marketing of a range of goods and services in rural India.4) Becoming tested market for new services like selling home appliances, consumers goods.
THERAT1)socio-economic characteristics of different areas is different thus common method cannot be applied.2)increasing competition from other player like Ruchi and Tata.3)supply chain, revenue models vary across commodities and geographic