A Comparative Study

ITC – e Choupal

E – Choupal (June 2000)

An initiative of ITC Limited to link directly with rural farmers via the Internet for procurement of agricultural & aquaculture products

The programme involves the installation of computers with Internet access in rural areas of India to offer farmers up-to-date marketing and agricultural information.

Initial Objective:⋗ Access to target soya producing markets & achieve organized

buying over the current Indian soya procurements systems in long term

Mid Objective:⋗ Access to key agricultural/products producing markets & achieve

organized buying & selling in key Indian rural markets

Current Objective:⋗ To expand the network further & offer a complete package to

server rural customer daily needs & develop the platform for the future (to get services like web tourism)

To Develop a Channel Directly Linking farmers to Organizations:

The eChoupal infrastructure

• ITC Kiosk with Internet Access and Local Language Content (Weather, Prices, Farming Practices etc)– In the house of one trained farmer, Sanchalak – Within walking distance of target farmers

• Warehousing Hub with Internet Access– Managed by the erstwhile middleman, Samyojak– Within tractorable distance of target farmers

The ITC eChoupal Scale

Today– 6500 Choupals are serving over 4million farmers & villagers

across 40000 villages (adding 6 a day)• Higher capture of consumer spend• Building capacities of rural communities

Vision– Reach 100,000+villages by 2012• Dealing with wider variety of crops• Creating infrastructure for Education and Healthcare

services• Enhancing Quality of Life in rural India

E-choupal: Strategic Thrust

Procurement: cost & quality optimizationo Strategic sourcing support to the Foods business (support creation of

verticals in wheat, soya, corn, potato etc.)o Cost-effective sourcing for exports/domestic external business

Rural Distributiono ‘Last mile connectivity’: 100 partnering companieso Diverse range of goods/services: FMCG, consumer durables, agri-inputs,

paid extension services etc. Financial Services

o Insurance (focus: weather)o Credit (focus: Kisan Credit Card scheme)

Rural retailo 24 Choupal Saagars operational

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E- Choupal Saagar – Benefits to a Farmer

• Option of selling to Choupal Saagar or Mandies• In some crops, farmers earns 25% higher prices than

selling to Mandies• Profit realization increased upto 60%• Availability of Loan facilities• Availability of brands/quality products at best prices• Exposure to latest information

• Difference in net earning will be high if saving on commission to middle man & cost of transport are considered

Main Competitiors

Godrej Aadhar – Godrej Kisan Seva Kendra - IOC Tata Kisan Sansar - TATA

Chemicals Mahindra Subh Labh – M&M HUL iShakti – HUL Parry’s Conner - Murugappa

Group

Conclusion

• An innovative strategy which is elaborative & extensive in rural markets so far.

• Rural wealth creation in agriculture through securing empowerment, collaboration & competition

• A transformational initiative for sustainable development of society

• Commitment to transparency & the respect & fairness with which both farmers & local partners are treated.

Venkatesh. BInderveer Singh .B

Thank You