Posted by Venkat Subramaniam, GM, NetSuite India
Indian agriculture is going through a period of rapid development, driven by advancements in technology. Increased connectivity and access to mobile devices is providing farmers with new ways to sell their produce and helping to improve working conditions and living standards in farming communities.
The International Labour Organization estimates that 43% of the Indian workforce is employed in agriculture, and with a population of close to 1.4 billion it’s a huge industry that’s ripe for modernisation and progressive thinking. This has led to India becoming a hub for agricultural technology (agritech) startups in recent years. Many of these businesses hope to improve the lives of Indian farmers, who are facing an array of difficult challenges, including the impact of climate change on the annual monsoon season.
One agritech business sowing the seeds of change is Farmpal Techlogi. Founded in 2017, the Pune-based startup has developed a digital supply chain platform—powered by a user-friendly mobile app—that connects farmers directly with business customers, cutting out the middleman. Farmpal co-founder, Karan Hon, believes in overcoming tough agricultural problems through innovation.
“The best solution is using technology very effectively,” he said.
Efficiency Cultivates Fairer Prices
Food prices across India have spiralled upward in recent years, largely due to the rising costs in food production and long periods of drought. Farmers have been hit the hardest, continually squeezed by wholesalers and powerless to challenge the prices they set. This is compounded by India’s multi-layered distribution system, with harvests going through as many as four intermediaries before reaching vegetable markets in metropolitan areas.
Farmpal bypasses these middlemen with its supply chain, matching farmers with hotels, restaurants, caterers, modern retailers and local shops. The forward-thinking business uses AI and machine learning to predict buying behaviour, as well as optimising transport routes to reduce delivery times. By applying digital technology to an analogue industry, Farmpal has yielded amazing results.
“We have reduced wastage from 30% to just 5%,” Hon said, noting that the improvement in supply chain efficiency means Farmpal can pay farmers more for their produce. “On the app, farmers can see the price offered by us and offered by the market.”
Better still, Farmpal pays farmers directly within three days. This added financial security gives farmers more control, more peace of mind and more freedom to plan ahead. As Hon explained, Farmpal has three guiding values, “Empowering farmers, transparency and accountability.”
Such progressive principles don’t just benefit farmers. Businesses can now get next-day delivery using the Farmpal app, alleviating the need to visit the market. These timelines mean less food is wasted, but Co-founder, Puneet Sethi, is committed to making Farmpal’s supply chain even more efficient.
“The farm-to-store time is currently 15 hours. We’re working to bring this time down to 12 hours,” he said.
Customers know they can trust Farmpal to provide fresh goods of the highest standard. The company now boasts a 95% customer retention rate, a 97% fulfillment rate and just a 1.8% return rate. Considering that Farmpal deals in perishables, these numbers are even more impressive.
Technology For Growth
Keeping track of inventory is central to Farmpal’s success. It needs lots of data to manage the movement of goods, as any mistakes could result in produce going bad and the business losing stock and customer confidence.
When the business was in its infancy, it tried to do everything with spreadsheets, but this quickly became problematic. To overcome these challenges and enable business growth, Farmpal chose NetSuite to integrate its financial and inventory data.
Farmpal is now able to gain more insight into mission-critical operations, and with real-time data access, it can plan ahead, provide convenience to customers and accelerate payment cycles for farmers.
“NetSuite ERP is our secret tool for engineering the success of Indian farmers with visibility into inventory and financials, to help them sell better,” Hon said.
Faced with an uncertain future, Indian farming desperately needs to find alternatives to the multi-layered and often wasteful system of intermediaries that currently controls much of the agriculture industry.
Farmpal proves there is another way. Armed with new technology and connectivity, farmers are no longer at the mercy of the middlemen, with Hon concluding:
“Technology places power into the palms of farmers.”
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Posted on Wed, March 4, 2020
by NetSuite filed under