M&M attributes the growth of the farm equipment to external factors like good monsoon and increased government support to rural and agri sector, as well as external ones like products and service readiness, product launches and strengthened channel network.
Jejurikar points to three acquisitions that were carried out to cater to different categories of farm mechanisation. “We acquired 33 per cent stake in Mitsubishi Mahindra Agricultural Machinery, Japan, in May 2015 to cater to the global rice value chain, 35 per cent stake in Sampo Rosenlew, Finland, in March 2016 to address the global combine harvester business and 75.1 per cent stake in Hisarlar, Turkey, to address global range of soil preparation. All these deals will help us get into new segments and geographies,” he says. Second, the company is aiming to utilise its presence in the US, China and Japan to expand its network. “Through this we recently entered the Mexico and Brazil markets. We have chosen these markets carefully, understanding its current and future farming potential.”
The company is also bringing in innovation in terms of reaching out to customers, addressing several aspects from product positioning and advertising to the way it explains the sales story on the ground. “We play an important role by establishing in-depth relationship with farmers, by understanding their environment and challenges so that we can offer tangible solutions. Understanding these evolving requirements, we have launched three new tractor platforms in the last three years,” Jejurikar says.
The three models are — Mahindra Arjun Novo in 2015, a tractor with futuristic features in the below 50 HP category; Mahindra Yuvo (2016) that caters to five products in 30-45 HP segments and targets 70 per cent of the tractor industry; and Mahindra Jivo this year, a small tractor platform in the sub-25 HP category suitable for row crop and horticulture farming. The newest model is equipped with Mahindra’s digital technology model, DiGiSENSE, which gives farmers real-time updates on their tractors’ performance.
The company stresses the importance of live information and complete crop solutions for farmers, and hence the need for innovation. With its on-demand farm equipment rental service, Trringo, it tries to tap technology and digitisation to make tractors and implements more accessible to the small and marginal farmers. “Trringo completed its first year of operations in March, reaching 12,000 farmers and 4,000 hours of operation in four states,” says Jejurikar.
In India, the company promises to change the face of agriculture with the help of its initiative called Farming 3.0. “Farming 3.0 is about boosting production, reducing wastage, integrated value chain, connecting consumers to technology platforms, data-driven advisory, spreading agri know-how through digital platforms, developing smart machineries like autonomous tractors, drones and sensors supporting high-tech applications, strong irrigation infrastructure and innovation led-technologies,” Jejurikar explains.
With its thrust on “solution selling”, that goes beyond selling only tractors, M&M aims to play a proactive role in driving mechanisation in the Rs 5,000 crore Indian market for non-tractor equipment.
Experts agree that companies
need to increasingly move beyond selling of tractors and into farm equipments which in India is largely driven by small-time, unorganised players.
Rajeev Singh, automotive consulting head for Deloitte, says that leading firms can build on selling the entire system, focus on differentiate products with design and stress how buying tractor as well as non-tractor products from one stable can work better for farmers. This may require a firm to help farmers in terms of the affordability of equipments, in turn also benefiting dealers with adding value to their offerings. On the importance of digital solutions, Singh adds, “The need may not be necessarily always coming from the farmer’s side, but a company can come out with new digital solutions which can help farmers specifically and ensure the uptime of their tractors and equipments are higher.
You want to ensure that in case of failure, the repair is done at the shortest possible time. That is where digital connectivity could really help.” Digital solutions will help farmers as well as OEMs who are not just building brands but also in effect helping enhance sales of their spare parts, he says, adding that it’s one area where Indian companies
have yet to catch up with some firms globally.
M&M is targeting a $150-billion global farm equipment market, of which the non-tractor segment is worth $90 billion
Timely acquisitions and utilising company presence in global markets are part of the new strategy which includes organic as well as inorganic growth
It is innovating in reaching out to customers. M&M launched three tractor platforms in the last three years — Mahindra Arjun Novo, Mahindra Yuvo and Mahindra Jivo. Mahindra Jivo (below) gives farmers real-time updates on their tractors’ performance