rural supply chain management
TRANSCRIPT
Rural Supply Chain Management
GROUP 1 (LSCM) -PGDM-A (2016-18)
SAHIL AGARWAL (01)NEHA GOYAL (13)
VAIBHAV MOHAN (22)ROHIT RADHAKRISHNAN (35)
SANYA SINGLA (50)SHIKHAR SODHANI (53)
Rural Area
NSSO and RBI Definition
Population density 400/km^2
75% involved in Agriculture and allied activities
Surveyed boundaries but no municipal board
Population of less than 49,000
tier -3 to tier-6 cities
Rural Market in India
6.1 Lakhs of villages
Per Capita income Rs 40,772
Income expected to grow twice
Rural expenditure 55% of total national monthly expenditure
13% of India’s GDP on logistics
RURAL SUPPLY CHAIN MANAGEMENT
Critical aspect for developing nation
Constitute about 68% of total population i.e about 800 million people. Estimated size of about US$ 53 billion.
An integrated rural supply chain network(IRSN) is a group of independent companies, often located in different regions, forming a strategic alliance with the common goal of designing, manufacturing and delivering right quality products and services to customer groups faster than others.
Supply chain management flows can be divided into three main flows: The Product Flow, The Information Flow, and The Financial Flow
Sectoral distribution of RSCM
Ecommerce FMCG Medical Automobile
Small means for customer Affordable Less investment reduced risk of buying For companies Large volumes, helps address divers
customer segment, Attracts Non user %Sales in rural areas of small packets -
28percent
Sectoral distribution of RSCM
Potential in RURAL INDIA
60% of the population is in rural area
India with a GDP of about 31,297 billion is estimated to spend 13 per cent of its GDP on logistics.
Double digit growth rate since 2002
Large Consuming Class
Why Not Target Bottom of the pyramid
Case Studies
Parle G
why rural markets ? size of market rural market is having 60 percent of demand income levels have increased
rural penetration - 50 - 65 %
e-Commerce and Rural SCM
Amazon and Flipkart floated pilot projects Local men from the village Number of deliveries per hour is much more than
Urban, due to less traffic Flipkart, got native entrepreneurs to sell Motorola
phones to rural consumers Training Programs, promoting small city sellers,
outsourcing
e-Chaupal Initiative by ITC
To overcome weak infrastructure and involvement of intermediaries
Directly linked farmers with ITC for procurement of soybeans, coffee, and prawns
Traditional Agricultural Supply Chain
Problems in existing Chain Lack of warehouses
Fruits and vegetables wastage as high as 45%
Planning Commission estimate 35 mn MT
Limited reach of mandis 12 km to 50 km travel
Too many intermediaries Inflate cost by 250%
Lack of collateral management options
Gramco Supply Chain
Commenced operations in 2010
Received 2.3 Million $ funding
Provides infrastructure near farm areas
Acquired land at Binjal, Nanded, Titwas, Atut and Pipliyanath in 2013
Service Provider for RURAL SUPPLY CHAIN
MANAGEMENT
An Initiative by India’s Logistics veteran – Sh. L R Shridhar
AboutConnect India
VisionTo create a pan India last mile delivery network covering 25000 pin codes by leveraging the existing economic assets such as the brick and mortar retailer and the digital India platform by engaging in a robust mobile first technology.
TargetTo appoint 50,000 last mile delivery entrepreneurs as Connect India Centres (CICs), who in turn will provide employment to 200,000 plus delivery associates from their local communities in the next 3 years.
Point of ContactThe company will leverage existing under-utilised economic assets, such as kirana stores, pharmacies, department stores, and boutiques to develop a last-mile entrepreneurial-based distribution network.
Reverse Logistics Gridding the country into a 1 x 1 Sq Km layout and creating optimal routes for every city,
town and district Small and medium scale industries, small-scale farmers, SHGs, artisans remained largely
unconnected to the mainline markets with the middlemen as the only source of connectivity and income
Logistics cost of supplying directly to the market is exorbitant With advent of Digital Era, rural entrepreneurs and producers are getting connected
through e commerce portals and other platforms Reverse logistics service will bridge the gap between urban and rural markets at a fair cost Will help the rural producer ship directly to the mainline urban markets and also to the
direct end user not just in India, but also across the world
Thank You
Queries ?