This Bhopal start-up shows how to achieve scale in sale of organic produce

Bhopal startup
There are three common problems that Indian agriculture suffers from. One is the presence of middlemen resulting in lower yields to farmers, a second is vagaries of the monsoon and other unpredictable developments that may ruin the crop and a third is heavy use of pesticides that are harmful for human consumption. As and when organic options are available, they are too expensive for most.

It is with intention of tackling all these in whatever small way he could that Prateek Sharma left his job as a banker after ten years and started his farming venture in Bhopal. In 2016, he started in a small way with a handful of farmers to whom he dictated terms – what seeds to use, how to protect the crop, how to minimize the use of fertilizer and grow vegetables that were organic and chemical-free. Above all, he explained to them how to do this without making the end product too expensive for most to access. In addition, Sharma worked out a system by which the farmer got a better return by eliminating the middlemen who corner a large proportion of the revenue. As a result, he managed to start supplying vegetables directly to a host of customers in Bhopal – fresh, healthy, organic vegetables at decent prices. The prices compete with those of non-organic options available in the market by ensuring that production costs are lower and the supply structure is flat.

Bhopal startup
Through 2016 and 2017, things proceeded fine if slowly. Sharma worked on proving what he claimed could be done, gradually grew his customer base, added more farmers to his cohort and tried to widen the scope of vegetables he could offer.

But it was after a year that Sharma realized that while dreams may come true, they are not as easy to grow and sustain. All was going well but reaching any kind of scale was easier said than done. When you grow your own basket of goods, how do you diversify the basket? How do you offer all the products that customers want? How do you ensure the quantities required? How do you reach new customers? How do you maintain continuity? How do you ensure perishables reach the target on time and spoilage is minimized? As you add more farmers, more products and new customers, complexity grows. Things no longer are as simple as when you begin. As the tiny operation grew, Sharma needed more hands.

At a stage when many begin to give up, Sharma decided to go at it with a missionary zeal. In 2017, his wife Prateeksha also quit her job and joined him. He got another friend on board as a partner. It also appeared like they could survive on their income from the business, even if it meant tightening the purse strings a bit. To add new streams of revenue, they grew their portfolio. Grains, spices and dairy products have slowly been added to what’s on offer.

In 2017, a small acknowledgement came of their work. IIM Kolkata chose his venture under the INVENT programme of the government and DFID, UK. A small amount of seed finance was offered to him amounting to a total of Rs 25 lakh, not a very large amount but encouragement nonetheless.

Sharma is managing supplies through two modes. A van with vegetables is sent out to four societies every day and reaches a certain number of regular clients. In addition, orders are received through Whatsapp and are delivered through the day. Now he is supplying to 650 customers and his turnover has touched Rs 3 lakh a month. Almost 60 products are now on offer and they recently diversified into grains, spices, dairy products and a few processed foods to generate a new revenue opportunity. 

Bhopal startup
But Sharma has realized now that retail will grow at its own pace. Since he now has a good handle on production and the farmers he’s working with, he’s looking at supplying to vendors like Big Basket, Reliance Fresh and Nature’s Basket who have a larger reach online. “There is a clear gap in demand and supply as the products are perishable”, says Sharma. Unless these large online retailers partner with farmer groups or cooperatives in some way – which is hard for them to do – there is a role for organisations like his. For this model to work, a real-time flow of information between the two has to be developed and that’s where technology comes in.

So now the B2B business is being carved out as a separate entity. Green and Grains will also become one of the customers of the B2B entity. The technology is now being developed to examine the sale patterns and quantities required by online retailers so that Green and Grains can tailor its production to their needs. “This is critical since one has to know how much of what to supply on a daily basis as production too takes time. Something may need one month and another item may take three months so this has to be accounted for”, explains Sharma. Standard operating procedures have to be put in place and the whole production has to be tailored to the requirements of the retailers and this information flow has to be real time.

His one big learning over the last four years: achieving scale is easier said than done but if you put your mind to something, it can be done. And patience helps.

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