Presented By

Uday Mishra GSBA Gr. Noida ukmishra85@gmail.com 9891683518

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DEFINING RURAL INDIA RURAL RETAIL SCENARIO IN INDIA

REGULATIONS AND POLICIES IN RURAL RETAIL

SIGNIFICANT PLAYERS 1.goderj adhar 2.itc -chaupal 3.hariyali kisan bazaar BUSINESS MODEL OF ITC IMPEDIMENTS & RECOMMENDATIONS
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Census of India defines Rural Settlements as......

Population lower than 5,000 persons Population density lower than 400 persons/sq. km At least 75% of male population engaged in Agri. activities.

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RETAIL TOWARDS RURAL AREAS GREAT OPPORTUNITIES FOR MARKETER

THE INDIAN RURAL MARKET

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 Rural India consists of 720 Million consumers across 6,38,000 villages ---17% of these villages account for 50% of the rural population and 60% of the rural wealth ----Extensive reach is required as to cover 50% market 1,00,000 villages must be catered Immense opportunity amounting to US$ 125 billion

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 Rural Retail is growing @ 7% p.a.

Rural consumption is also shifting from basic food grains to fruits, vegetables, dairy and poultry products, as well as beverages

Demand for better quality food leading to huge demand for basic foods

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The Rs 140,000 crore rural retail market is expected to cross Rs 180,000 crore mark by 2010, And up to Rs 240, 000 crore by 2015 (CII).

The rural revolution is driven by

Rising purchasing power, Changing consumption patterns,

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increased access to information and

communication technology,
improving infrastructure increased government initiatives to

boost the rural economy,

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OCCUPATIONS Cultivator Petty Shopkeeper Wage earner Salary earner Others

URBAN 5 15

RURAL 40 5

20

35

40

20

18

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Total Retail
Value $ bn

US 2325

China 323

India 180

% Salience to above Traditional

Modern

15 85

80 20

98 2

Source: Census 2001, IRS 2006, AC Nielsen Source: AC Nielsen

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Is a value seeker Seeks comforts and amenities Does not wish to be seen as the

deprived cousin. Does not experiment easily but this does not mean that he would not change. Values local relationships because of unfavourable past experiences
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1. Essential commodity act: The fertilizer industry is centrally regulated by the government through an administered pricing mechanism & sales allocation under Essential Commodities Act (ECA). In the year 2002-03, the government announced a long term Pricing policy for urea. 2. Indian Land Acquisition Act 1894

3. Agricultural Produce (Grading & Marking) ACT, 1937

(ACT No. 1 of 1937)(as amended up to 1986)

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54 Non Agricultural Use Clearance--

5. Under PN4/2006 --100% FDI is allowed through the automatic

route in -Floriculture, Horticulture, Development of Seeds, Animal Husbandry Pisciculture, aqua-culture, cultivation of vegetables, mushrooms, under controlled conditions and services related to agro and allied Sectors.

6. Intra state agricultural land taxes -- vary, prompting the current

finance-minister to moot for a common GST (Goods and services tax) which would help in bringing all the various state taxes under a common fold including the agricultural income taxes levied individually state to state.

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GODREJ ADHAR ITC-CHAUPAL HARIYALI BAZAAR

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FORMAT OF GODREJ ADHAR FMCG products, fertilizers, animal feed, etc. Services like banking, insurance, pharmacy, postal services and petrol pumps

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A COMPLETE SOLUTION PROVIDER FOR THE INDIAN FARMERS

provides professional guidance with an objective to improve productivity, higher returns and improved cost benefit ratio. services offered crop advisory services, soil & water testing services; buy back of output, crop finance, supply of agri inputs and animal feeds, transfer of information (weather, price, and demand supply), door delivery of products etc.
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24 outlets in eight rural locations across the country and each outlet services 20 villages in its vicinity
Godrej Aadhar has already forged JVs with Apollo Pharmacy,

Tata Agrico, Bajaj Allianz Life Insurance and HPCL for value added services at the outlets.
The company plans to set up more than 1,000 stores by 2010.
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The Trusted Rural Business Hub

Help the customer increase his income, educate the customer, before you sell to the customer

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Hariyali Kisaan Bazaar

Mr. Ajay Shriram, Chairman Mr. Vikram Shriram, Vice Chairman & MD The concept aims to simplify the
Private label seeds
Contract farming vegetables Procurement
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Hariyali Kisaan Bazaar

DSCL plans to expand to 250-300 outlets by the end of FY 2008-09.
Each store covers an area of 3-4 acres and is managed by a team of 7-8 people whom the Company trains continuously. It offers the rural household all farming and consumer products and related services along with financial services under one roof. The company also launched credit services during its second quarter 2007-08, in association with HDFC bank, providing loans for various purposes.
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The number of Hariyali outlets now stands at 177, which the company plans to scale up aggressively to around 300 outlets by March 2009. Launched in 2002-03 Hariyali is now present in 8 states across India

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This concept aims to

Provide the power of expert knowledge to even the smallest farmer 2. Information helps farmers secures better price, quality and productivity

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Benefits to farmers include

Better purchase price of agri-inputs Avail information on best farming practices Command prevailing market prices

4 million farmers benefited through 6,500

installations covering around 40,000 villages

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By 2012, ITC Vision is to cover 100 thousand villages, which represent 1/6th of rural India, and create more than 10 million e-farmers
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IDEA BEHIND CHAUPAL SAGAR

-- MAKE THE POTENTIAL CUSTOMERS --PROVIDE DIFFERENT CUSTOMER SERVICES

--REAP THE BENEFIT FROM POTENTIAL CUSTOMER

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A WIDE RANGE OF PRODUCTS FOR ALL SEGMENTS TRAINING FACILITIES FOR FARMING COMMUNITY

ON SCIENTIFIC FARMING PRACTICES

GODOWNS FOR STORAGE OF FARM PRODUCE

INFORMATION CENTER FOR ONLINE WEATHER

INFORMATION
CONTINOUS SERVICES FROM 6AM- 9PM
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ESTABLISHMENT OF ATMs AT MALLS AVAILIBILITY OF INSURANCE PRODUCTSFOR

FARMERS
TIE WITH PRIVATE HEALTH CARE SERVICE

PROVIDER FOR PRIMARY HEALTH CARE FACILITY

TIE WITH BPCL FOR FUEL PUMPS ESTABLISHMENT OF SOIL TESTING LABORATRIES

PUBLIC ENTERTAINMENT
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ITC
INPUT SUPPLY

MARKETING ASSISTENCE

TECHNCAL GUIDANCE

INSURANCE COMPANY

FARMERS

AGRI-INPUT COMPANY

AGRICULTURE UNIVERSITIES/STATE AGRICULTURE DEPT

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TRAINING

o Increasing costs of land

o Pace of expansion
o High operating costs

o Low margin of agri-inputs

o Low purchasing power of consumers

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 Lack of literacy and awareness Low per capita income Wide geographic spread. Gaps in road and Telecommunications connectivity. Lack of reliable electricity and water supply Limited Distribution network for example cold storage. Competition from local players

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Farmers get agri-inputs at competitive rates and

have range of products to choose from

Increasing rural bank aid (loans) helps improve the

purchasing capability of farmers

Farmers avail of the services of agronomists to

improve their farming practices, thereby impacting on their final produce

Farmers get a better price for their products and

avoid middlemen
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 Integration of rural initiatives into business model like

ITC

Corporate should supplement government efforts & resources (infrastructure development, education system, storage) Creating retail stores which should be rural in nature so that the rural masses identify themselves with these stores. Innovative & Exciting Initiatives such as Village BPO should be given impetus to tap the talent in the rural India.
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During the first millennium AD, merchants referred to India as the Bird of Gold, due to the glittering dynamism of its market. Over the next few years, the Bird of Gold is poised to take flight once again.

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THANKS

THANKS
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