1. "Agriculture based Livelihoods: Opportunities and Potential"
Access Livelihoods India Conference
17th -18th Nov, 2010
Hotel InterContinental Eros, New Delhi
Reliance Retail Ltd. 1

2. Reliance agri supply chain
Reliance Retail created a farm to fork supply chain for fresh fruits & vegetables.
Developed base with growers
Retail operations spread across country
Handling of all fruits & vegetables
Different supply chain models as per product need 2

3. Reliance banana supply chain
Established robust end to end supply chain for banana
Inclusive business model – Co-opting the entire agri value chain
Also caters to external customers
Developing upon the strength of existing channel partners
Reduce post harvest losses ,improve quality , better market access
Profitable business proposition - scalable and sustainable model
Win-Win situation - enhanced value to growers, customers and the company 3

4. Traditional Supply Chain
Growers
Village level Consolidators
Retailers/
Consumers
Wholesalers in terminal markets
Semi Wholesalers / Ripeners
Harvested in looms
Transported loose
Maturity stage based on distance travelled
Finances growers
Arranges loading and transportation
Charges commission and cost incurred to growers
Auctions in mandi
Finances consolidators
Extends credit to buyers
Charges commission and recovers advances & cost
Uses unscientific practices for ripening
Extends credit to retailers.
Also owns push carts
Gets known people from villages to operate them
Gives a price band to sell
Operator makes up for any loss
They get fixed amount per day paid as lump sum amount when leaving for home-town
Poor quality.
Low shelf life
Often sold at mark-down price 4

5. Traditional Supply Chain
Village auction
Loader standing on loom
Conventional ripening
Loading of loom
Loose transportation
Poor quality for customers 5

6. Drawbacks – Traditional Supply Chain
Many intermediaries - adding costs but little value addition
No ownership of produce quality - No effort channelized towards reducing losses
Once harvested, farmer is at the mercy of traders
More than 30% of produce in the value chain becomes unsalable
Waste handled in city – unhygienic environment and additional cost
Financial value loss passed onto grower , quality value loss passed onto consumer
Poor shelf life 6

7. Reliance Value Chain Company appointed vendors
Growers
Company appointed vendors
Company owned ripening facilities
Distributors/ Retailers
Consumers
Buying directly from field
Fixed farm gate price
Payment linked to quality
Secured payment
Trained on post harvest handling
Simple infrastructure/ gadgets to follow practices.
Fixed logistics cost per Kg
Payment on quality & quantity received at company
Weekly indent
Scientific ripening under controlled condition
Quality check of green fruit
Control of dump, shrink and transit loss of each consignment.
Dispatch quality check
Purchases at fixed price from company
Price as per quality
Daily supply as per requirement ensures fresh stock available for customers.
Training on fruit display & handling
Retailing losses reduced with fruit at right stage of ripeness
Mark-downs minimized due to better shelf life
Consistent quality with
better shelf life
Appreciation of quality offered - willingness
to pay premium 7

8. Reliance Value Chain Transportation in crates De-handing Store display
Ripening chamber
Display at pushcart
Washing
Raw banana
Labled banana 8

9. Reliance Value Chain – salient features
Paradigm shift from trading driven operation to a value addition based supply chain
Draws on strength of existing players but transforms role towards improving quality
Purchase price fixed before harvesting – de-risking farmer from market uncertainty
Secured payment to farmer as per commitment
Right maturity stage harvesting – improves quality of fruit and productivity
Price benchmarked with quality – motivates farmer to adopt practices for improving quality
Tie ups for better planting materials to improve yield
Developing existing channel partners for marketing produce 9

10. Inclusive Innovative Agri model suited to the local context
Major impact areas
Improvement in farmers income
Farmer access to new markets
Reduction in losses
Creation of rural employment
Improved quality to consumer
Environment friendly
Benefits of the model enticed unorganized sector to adopt best practices
Inclusive Innovative Agri model suited to the local context 10

11. Key milestones
Sourcing from 40 banana growing clusters across the country
Linkages with more than 2000 growers
Developed 150 plus vendors for procurement
Marketing in 16 major cities to internal as well as external customers.
100 plus distributors & organized retailers 11

12. Thank You!