1

TITLE

A study on the supply side assessment of the vegetable seeds with the
distributors and dealers

Agri - Input Marketing (AIM)

Submitted to:

Ms. Nidhi Kapil Kasetwar

Submitted by:

Group no. 5, Section 1

Asnil Kanojia (09PGDM004)

Leeladhar Dhaker (09PGDM 017)

Ajit Kumar Mishra (09PGDM0 20)

Vidya Patil (09PGDM 028)

Priyadharshini A (09PGDM 029)

 2

ACKNOWLEDGEMENT

We consider ourselves to be very much fortunate to work on this project. We would like to
express our gratitude thanking to all the distributors who helped us in every bit of our
project with respect and concern.

We would take a privilege to thank our course teacher, Ms. Nidhi Kapil Kasetwar

( GROUP 5)
 3

TABLE OF CONTENTS

CHAPTER 1 INTRODUCTION 5

CHAPTER 2 REVIEW OF LITERATURE 8

CHAPTER 3 DATA PRESENTATION AND ANALYSIS 9

ANNEXURE 17
REFERENCES
20

LIST OF FIGURES AND TABLES

Table 1 Distributors Business Plan 16

Graph 1 Procurement of fruits and vegetables 9

Graph 2 Procurement from 9
Graph 3 Mode of payment while procuring seeds 10

Graph 4 Procurement of seeds in the form of 10

Graph 5 Obstacles faced to supply good quality seeds 11

Graph 6 Support services to the consumers 11

Graph 7 Average land size of the farmers who procure seeds 12

Graph 8 Types of customers 12

Graph 9 Demand for the seeds 13

Graph 10 Types of seeds preferred 13

Graph 11 Knowledge about the nature of the customer demand 14

Graph 12 Knowledge about the supply of seeds 14

 4

ABSTRACT

India is the second largest producer of commodities such as fruits and vegetables. One of the key
issues, which require research, is the method by which we can reduce the obstacles of the efficient
supply chain , which is quite substantial at present. Also, there is need for value addition to
agricultural produce like hybrid seeds to maximize the agriculture return. India is likely to become
the food basket to the world considering 52% of total land under cultivation as compared to global
average of 11%. India is also having the labour cost advantage; organized research is growing very
speedily. Because of these developments, farmers would get latest market prices and various
products, and best farming practices. This paper discusses the importance of effectiveness of the
supply chain in agribusiness by the supply side assessment conducted with the dealers. The study
reveals that 78% of the distributors procure vegetables.85% of the distributors procure through
the proper distribution network from the company.48% of the distributors go for credit facilities
while procuring which is to be paid within the stipulated time, say 15 days or within a
month.96% of the distributors purchase in the form of sealed packaging directly from the
company which they feel as a quality preservant. Most of the distributors narrate seasonal
dependence, financial facilities and promotional activities as the hindrance to supply good
quality seeds.65% of the distributors provide credit facilities and 40% of them provide after-
sales service.70% of the farmers were having medium land holding size of about 1 – 3.5
acres.76% of the farmers comprise the customer category which reveals the direct relationship
between a distributor and a farmer.82% of the distributors said that demand for hybrids is more
than for the local varieties due to its higher yield and quality.78% of the distributors sell hybrid
seeds.58% of the distributors identify the consumer demand by the hybrid variety of a reputed
company. 65% of the farmers are aware about the supply of existing and new seeds availability
in the market by the fellow farmers and 52% by the dealers from whom they regularly buy the
seeds and 49% through the promotional activities. Thus the supply side assessment is the need
of the hour without which the delivery of the product at the right time, right place by the right
person is no possible.
 5

CHAPTER 1 INTRODUCTION

India is the second largest producer of commodities such as fruits and vegetables. One of the key
issues, which require research, is the method by which we can reduce the obstacles of the efficient
supply chain , which is quite substantial at present. Also, there is need for value addition to
agricultural produce like hybrid seeds to maximize the agriculture return. India is likely to become
the food basket to the world considering 52% of total land under cultivation as compared to global
average of 11%. India is also having the labour cost advantage; organized research is growing very
speedily. Because of these developments, farmers would get latest market prices and various
products, and best farming practices. This paper discusses the importance of effectiveness of the
supply chain in agribusiness by the supply side assessment conducted with the dealers.

There is a need to collect additional data to reflect appropriately the consumption of fruit and
vegetables in the context of health. To increase the usefulness of data on production, consumption,
and trade, consideration needs to be given to the type of data needed: fruit and vegetables are not all
equally good for health, there is variability among vegetable types in health benefits (not all of
which are fully understood), and macro-pictures of production, supply chain and consumption do
not reveal localized deficits or patterns within the informal sector.

We are jointly conducting a study with the vegetable distributors of Karnataka. After carrying
out research in major areas of Karnataka, we came to know about the shortage of quality seeds
in the market. We would like to explore this issue in greater depth by understanding the
specifics of the problem and investigate possible solutions.

Need for the study:

India is the second largest producer of commodities such as fruits and vegetables. One of
the key issues, which require research, is the method by which we can reduce the obstacles
of the efficient supply chain , which is quite substantial at present.

This paper discusses the importance of effectiveness of the supply chain in agribusiness by
the supply side assessment conducted with the dealers.
 6

Objectives of the study:

1. Examine the driving factors influencing dealer‟s behaviour and decision-

making process that determines adoption of supply chain practices.
2. Identify the hierarchy of influence that these driving factors have on vegetable
farmers

Research Methodology:

Descriptive followed by Conclusive type

Sampling Design:

Universe: Seed distributors of the vegetables in Karnataka.

Sampling unit: Vegetable seed distributors in Karnataka

Sample size: 16

Sampling method: Simple Random sampling

 7

Sources of data:

Primary Source:

Vegetable seed distributors

Secondary Source:

 Agricultural Portals

 Various Journals

 Literature Reviews

 Other Websites

Data Collection Tool:

 Structured Quesstionnaire with open and closed ended types of questions.

Location:

 Brinjal specific Markets in Karnataka

 8

CHAPTER 2 REVIEW OF LITERATURE

There was a work carried by Government of India on Domestic market research of more
than 10 fruits, mostly Mango, litchi, Ber, Guava, Pears, papaya, pineapple and grapes. This
work was helpful to know the exact condition of marketing, export scenario, production
technology, supply chain management and documentation.

Government of India, Ministry of Agriculture (Trade Division), sanctioned a project to

NAFED entitled “Market Intelligence study of selected crops having export potential” at a
total cost of 82.0 lakh. The selected crops are mango, grapes, Pears, litchi, Ber, Guava and
aonla among fruits; tomato, green chilies, okra and onion among vegetables; ginger and
turmeric among spices; and sesame, soya meal and cotton among commercial
crops/products. Project main work was to understand supply chain as well as export
marketing.

There was a work carried by ProfessorDr. A.K Thakur, Dr.Gautammandal and Dr. Dinesh
Gupta Punjabon Marketing of Fruits in India – Present practice and Future needs. Mainly he
worked on a Post-harvest management and how to improve the distribution channel.

Buyer-seller partnerships represent a state of interdependence with market-oriented

common goals, cooperation, joint planning and trust, leading to mutual benefits. Market
orientation has been defined as the active search for, generation of, dissemination of,
and reaction to market information on customers, competitors and environmental forces
in order to satisfy the needs of the final customer in a supply chain to the benefit of
supply chain stakeholders (Elg, 2002).

Cooperation has been defined as “similar or complementary coordinated actions taken by

firms in interdependent relationships to achieve mutual outcomes or singular outcomes with
expected reciprocation over time” (Anderson and Narus, 1984, p. 45). Joint planning is part
of cooperation and specifically addresses the actions decided by both firms together (Claro
et al., 2003).
 9

CHAPTER 3 DATA PRESENTATION AND ANALYSIS

Total No. of respondents : 16

Procurement of fruits and vegetables (Graph 1):

Vegetables Fruits
78% 22%

 78% of the distributors procure vegetables

Procurement from (Graph 2):

Distribution Network Dealers Middleman

85% 13% 2%
 10

 85% of the distributors procure through the proper distribution network from the
company.

Mode of payment while procuring seeds (Graph 3):

Cash Cash + Credit Credit

18% 34% 48%
 48% of the distributors go for credit facilities while procuring which is to be paid with in
the stipulated time, say 15 days or within a month.

Procurement of seeds in the form of (Graph 4):

Loose Capacity Sealed Packaging

4% 96%

 96% of the distributors purchase in the form of sealed packaging directly from the
company which they feel as a quality preservant.
 11

Obstacles faced to supply good quality seeds (Graph 5):

Early, Promotion Investment and Storage Communication Pricing and

seasonal, late, credit facilities Network Package sizes
off-season

32% 21% 26% 18% 15% 15%

 Most of the distributors narrate seasonal dependence, financial facilities and promotional
activities as the hindrance to supply good quality seeds.

Support services to the consumers (Graph 6):

 12

Information After-sales Guarantee and

Transport Credit Facilities service others
45% 8% 65% 40% 16%

 65% of the distributors provide credit facilities and 40% of them provide after-sales
service.

Average land size of the farmers who procure seeds (Graph 7):

Marginal < 0.5 acre Small 0.5 – 1 acre Medium 1 – 3.5 acres
12% 18% 70%

 70% of the farmers were having medium land holding size of about 1 – 3.5 acres

Types of customers (Graph 8):

 13

Farmers Dealers
76% 24%

 76% of the farmers comprise the customer category which reveals the direct relationship
between a distributor and a farmer.

Demand for the seeds (Graph 9):

Local variety Hybrid

18% 82%

 82% of the distributors said that demand for hybrids is more than for the local varieties
due to its higher yield and quality.

Types of seeds preferred (Graph 10):

 14

Local Hybrid Variety

8% 78% 14%

 78% of the distributors sell hybrid seeds.

Knowledge about the nature of the customer demand (Graph 11):

Quantity Variety Quality

27% 58% 34%

 58% of the distributors identify the consumer demand by the hybrid variety of a reputed
company.

Knowledge about the supply of seeds (Graph 12):

 15

Fellow farmers Company Advertisements Dealers Middleman

officials

65% 15% 49% 52% 6%

 65% of the farmers are aware about the supply of existing and new seeds availability in
the market by the fellow farmers and 52% by the dealers from whom they regularly buy
the seeds and 49% through the promotional activities.

Other observations:

 Information on package are ingredients, expiry-date, date of manufacture, user

guidelines, dosage, storage guidelines, etc.
 Good relationship with the company and the dealers will solve the problems related to
financial facilities and the promotional activities.
 Uncontrollable factors like seasonal demands, quality deterioration can be solved by
pucca delivery system, storage facilities and stock management.
 Most of the distributors have preferred dealers under them for specific districts and
particular areas even for the particular seed types or they are dealers who are familiar in
their specified area. Their network is on mostly a permanent basis where increase in the
number of regular customers is important for them by the combined effort.
 The supply of good quality seeds is possible by the company‟s product and their
relationship level with the dealers.
 The number of dealers have increased in the last three years since the number of
companies and their product category is also expanded.
 70% of the farmers are able to buy good quality seeds due to their brand preference and
the availability of the good quality seeds with the nearby dealers.
 Complaints in the supply side is mainly related to the quality , comparison with the yield
parameters and price of the seeds.
 16

 Distributors business plan:

Exclusive distributor to any seed company
Distributor of more than one brand of the seeds
Distributor of seeds + pesticides and chemicals

Distributors suggest the improvement in the stock management, in providing the after-sales
service and efficiency in the promotional activities.

CONCLUSION

Thus, from the above study we conclude that the supply side assessment is the need of the hour
without which the delivery of the product at the right time, right place by the right person is no
possible. From this study, we arrive to the conclusion that the distributors facilitate the seed
companies in delivering their products and make the demanded products available to the
farmers. The areas where the dealers have to focus on is the timely delivery by well managing
the stocks and distributing the quality products with good promotional and credit facilities to the
farmers.
 17

ANNEXURE - QUESTIONNAIRE

1) Personal details:

Name of the respondent:

Address:

Telephone No:

Type of business:

Years in business:

2) What types of seeds do you buy/procure?

Fruits Local variety /Hybrid

/Vegetables Time of Purchase

3) How do you procure your supply of seeds from farmers/dealers?

4) How do you procure/buy your seeds?

a) cash, b) cash + credit, c)credit

5) What are all the informations given on package?

6) In what form do you buy your seeds?

a) Loose capacity, b) Sealed packaging

 18

7) What kind of obstacles are you facing with regards to supplying good quality seeds
(local/hybrid) to farmers and dealers?

a) Early, seasonal, late, off-season, b) Promotion, c) Investment and credit facilities

d)storage e) Communication network f) Pricing and package sizes

8) What are you doing to solve this problem at present? What else should be done?

9) What kind of support services do you provide your customers?

a) Information, b) Transport, c) Credit facilities, d)After-sales services

e) Guarantee and others

10) How many seed dealers are there apart from you? Of these, who are the sellers of good
quality seeds? Has the total number of dealers increased or decreased in the past three
years? Why?

11) What is the average land size of the farmers who buy your seeds?

a) Marginal: <50 decimals, b)small: 50 decimals – 1 acre c) medium: 1 acre –

3.5 acre

12) How many customers (farmers/dealers) do you have in total?

13) Do you feel the demand for seeds (local/hybrid) is gradually increasing?

14) What types of seed (local/hybrid/variety) record the highest demand in the market?

15) How many farmers in your working area are able to procure good quality seeds?
 19

16) How do you know about the nature (quality, variety, quantity) of customer demand?

17) How do buyers know that you sell/supply seeds?

18) Generally, what types of complaint do you receive about seeds from farmers?

19) What are your business plans for the future?

20) Suggestions (if any)

 20

REFERENCES

 Cunningham R. 2002. Canadian and Organic Retail Markets. Economics and

Competitiveness Information, Alberta Agriculture, Food and Rural Development.
Data Monitor. 2001. Next Generation Organics. London, England.

 Folkerts, H. and H. Koehorst. 1998.“Challenges in international food supply chains:

vertical co-ordination in the European agribusiness and food industries”. British
Food Journal 100: 385-388.

 Kethongsa, S., K. Thadavong and P. Moustier. 2004. “Vegetable marketing in

Vientiane (Lao PDR).”Report of the Project „Sustainable development of peri-urban
agriculture in South-East Asia‟No 00005600 funded by Ministry of Foreign Affairs
of France. Hanoi, Vietnam: RIFAV.

 Kuo, G. 2002. Perspectives of ASEAN Cooperation in Vegetable Research and

Development. Proceedings of the Forum on the ASEAN-AVRDC Regional Network
on Vegetable Research and Development. Shanhua, Taiwan: AVRDC.