MTS Report of Udyogini - Original

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Study Of Supply Chain Promoted By UJAS And Feasibility Of Distributing Agri-Inputs Through VLSC
KSRM 2
Study of Existing Supply Chain of UJAS and the Feasibility Study of

Distributing Agricultural Inputs through the Village Level Service Centers
Promoted by UJAS in the Mandla District of Madhya Pradesh
Authors
Arti Mishra
Rukshana Praveen
Reza Mohammad Khan
Sumeet Kumar Pandey
Host Organization
Udyogini, Jabalpur, M.P.
Faculty Guide
Prof. Alok De
“A REPORT SUBMITTED IN THE PARTIAL FULFILLMENT OF

THE REQUIREMENTS FOR MASTERS IN RURAL
MANAGEMENT”
School of Rural Management

Kalinga Institute of Industrial Technology (KIIT) University
Bhubaneswar, Orissa, India
September 2009
Management Traineeship Segment (MTS) I
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Approval Page
SCHOOL OF RURAL MANAGEMENT, KIIT UNIVERSITY
Bhubaneswar
The MTS Report of
Arti Mishra
Rukshana Praveen
Reza Mohammad Khan
Sumeet Kumar Pandey
Candidates for the degree of MBA Rural Management
Are hereby APPROVED
Prof. Alok De
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Executive Summary
Title Of The Project: Study of existing supply chain established by UJAS and checking the
feasibility of distributing agricultural inputs through the Village Level Service Centres
promoted by UJAS in the Mandla district of Madhya Pradesh.
Host Organization: Udyogini, Jabalpur, Madhya Pradesh
Project Location: 30 Villages of Mandla and Jabalpur Districts of Madhya Pradesh
Project Period: 6th July to 6th September 2010
Objectives of the Project:
 To understand the supply chain of retail products and procured commodities

promoted by Udyam Jagran Sansathan (UJAS) and find out the problems in its
operation
 To conduct a feasibility study for the business of distributing agri-inputs and related
services through village level service centres (VLSCs) of UJAS
o To estimate the demand for agricultural inputs and related services in the
target villages
o To assess the market condition of the agriculture inputs and services i.e. to
find out the potential competitors and suppliers
o To suggest business model/supply chain for the agriculture inputs and services
in the target villages
Methodology:
To achieve the objective of understanding the supply chain promoted by UJAS, the primary
data was collected by:
 Household surveys of 10 villages by 20% sample size where universe is a village and
survey unit is one house hold
 The primary data was also collected by structured interviews of 10 VLSCs
entrepreneur, Focus group discussion at 10 study villages
For feasibility study of distribution of agriculture inputs and related services through VLSCs:
 Primary data was collected by farmer household surveys with purposive random
sampling, taking 25% sample size the data was collected from 20 villages.
 The other source of primary data was structured interviews of competitors at local
market centers, and distributor interviews
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 The secondary data was collected on agriculture scenario in Mandla district, MP and
fertilizer consumption from World Wide Web and some of the valuable information’s
were also provided by the organization and the project functionaries
Findings and Analysis:

VLSCs and CLSCs are owned by UJAS. VLSCs are the Village Level Services through
which the Cluster Level Service Centers (CLSCs) sell retail products as well as procure the
commodities from the villages. VLSCs are operated by a woman entrepreneur selected from
the villages and get the required training by UJAS through Udyogini School of the
Entrepreneurship (USE). CLSCs are the centers which acts like a wholesale distributor and
coordinate the operations of all the VLSCs.
 Although VLSCs appreciate Udyogini’s initiative, there is a general dissatisfaction
among VLSCs about the CLSC’s offering, in particularly location, assortment,
opening time, CLSC operator knowledge, commodity procurement and pricing
mechanism.
 The supply chain is supply driven rather than demand driven. The CLSCs are product
centric not customer centric.
 We also found that at organisational level there is lack of goal and planning for the
VLSCs, unclear product definition, poor book-keeping and lack of value addition for
both retail products and procured commoditites.
For the feasibility study of agriculture inputs and related services, after research and analysis
it is concluded that the business of distribution of agricultural inputs and farm equipments on
lease is not feasible due to the following reasons:
 Insufficient demand for agricultural inputs and services at villages;
 The demand analysis also shows that investment in the agriculture and related
services is low in the villages;
 Financial analysis shows that business is not financially viable and sustainable,
 Geographical and physical conditions of the villages like low soil depth, poor soil
quality, lack of irrigation facilities and infrastructure.
Recommendation
For Supply Chain of UJAS:
 Proper implementation of 4Ps should be followed in the operational areas of VLSCs.

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 Variety, quality and quantity of the products offered by the CLSC should be increased.
VLSCs would like to see more variety in their retail products, since villagers demand for
these products, like medicines, soils, soap, oil etc.
 Operator’s knowledge about the prices in market should be increases so that he will be
able to advise and support the women when needed.
 Our research shows that women are motivated to improve or expand their business. In
order to be able to do this, the women would like to see that UJAS provided them with
credit facilities. Bookkeeping of Sales, procurement, stock, costs should be maintained.
 In order to reduce the operational cost of CLSC and to save the opportunity cost of
VLSCs, a mobile van concept could be implemented which would provide all the retail
products at the doorsteps of VLSCs. This would also be beneficial for the VLSCs
operators in reducing their transportation cost and might also increase their loyalty.
For feasibility of distributing agriculture inputs and services:
As the business is not financially viable and sustainable, the organization should not invest in
this business. They should expand the network of VLSCs which would help them to access
the market more which means to fulfill more demand.
The organization should also be engaged in promotion of some livelihood development

activities and skill/ capacity building of the people so that their purchasing power can be
increased. This would help the organization in two ways:
 Building repertoire with the community which will help the organization in their
future interventions.
 Once the purchasing power of the community increases any intervention of the
organization would be positively responded.
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Acknowledgment
In preparing this report a considerable amount of thinking and informational inputs from
various sources were involved. We express our sincere gratitude to everyone who contributed
towards making this report possible.
First of all we would like to thank dignitaries of Udyogini, Mrs. Vanita Vishwanath, CEO,
Mr. Arvind Malik, COO and Mr. Sandeep Mishra, Business Development Service Manager,
for giving us the guidelines for the successful completion of this report. We would like to
thank our reporting officer, Ms. Ketaki Narkar for her valuable support and feedback.
We would also like to thank all our respondents for their response without which this study
could not be possible.
We also take a special mention of faculty of KSRM, Prof Alok De for his valuable inputs.
Thank You
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Table of Contents
Contents
1. Introduction ................................................................................................................................. 12
1.1. Organization Overview: ..................................................................................................... 13
1.2. Project Overview: ............................................................................................................... 14
1.3. Rationale of the study: ........................................................................................................ 14
1.4. Objective of the study: ........................................................................................................ 15
1.5. Scope of the Study:.............................................................................................................. 15
1.6. Designated Project Area:.................................................................................................... 16
1.7. Limitations of Study: .......................................................................................................... 16
2. Methodology ................................................................................................................................ 17
2.1. Sample Design and Sampling Method: ............................................................................. 18
2.2. Survey Design: ..................................................................................................................... 18
2.3. Data Collection .................................................................................................................... 18
2.3.1. Product data collection ............................................................................................... 18
2.3.2. Process data collection ................................................................................................ 18
2.4. Data Analysis ....................................................................................................................... 19
3. Literature Review ....................................................................................................................... 20
4. Analysis and Findings ................................................................................................................. 24
4.1. Findings of study of supply chain analysis of UJAS ............................................................ 24
4.3. Demand analysis of agriculture inputs and related services: .................................................. 32
4.4. Inferences from the Field Study: ....................................................................................... 34
4.4.1. Land Holding Pattern:................................................................................................ 34
4.4.2. Land Irrigation Pattern .............................................................................................. 35
4.4.3. Major crops production and area under crops ........................................................ 35
4.5. Demand estimation of Agriculture inputs in the village .................................................. 36
4.6. Demand estimation of Farm equipments on lease (Agriculture Services) ..................... 38
4.6.1. Ranking of the Villages according to Consumption Urea and DAP ....................... 39
4.6.2. Ranking of the villages for Farm equipment on lease Utilization: ......................... 39
4.7. Market Analysis .................................................................................................................. 40
4.7.1. Target Market ............................................................................................................. 40
4.7.2. Market Size .................................................................................................................. 40
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4.7.3. Products and Services ................................................................................................. 41

4.7.4. Competitor Analysis ................................................................................................... 41
4.7.5. Strength and Weakness of Competitors: .................................................................. 41
4.8. Technical Analysis .............................................................................................................. 42
4.8.1. Technical analysis for the business of agricultural inputs and related services .... 42
4.8.2. Technical analysis for the business of agricultural inputs products only: ............. 43
4.8.3. Marketing Strategy: .................................................................................................... 44
4.9. Inferences from Distributor Interviews: ........................................................................... 44
4.10. Minimum Requirements for License: ........................................................................... 45
4.11. Financial Analysis ........................................................................................................... 46
4.11.1. Financial analysis for the agricultural inputs products and related services: ....... 46
4.11.2. Financial analysis for the agricultural inputs products: ......................................... 49
4.12. Socio-Economic Analysis ................................................................................................ 51
4.12.2. Advantages of the Project to the Community: ......................................................... 52
5. Conclusion ................................................................................................................................... 54
6. Recommendation......................................................................................................................... 55
7. References .................................................................................................................................... 56
8. Annexure ...................................................................................................................................... 57
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List of Tables
Table Description Page

No.
Table 1 Basic Information (MP) 32
Table 2 Land Use and Agriculture in MP 34
Table 3 Per Capita Agriculture Production 34
Table 4 Land Holding Pattern 35
Table 5 Total and Average Demand of Agri-Inputs in Sample Villages 37
Table 6 Consumption Pattern of Seeds 38
Table 7 Farm Equipment on Lease Utilization 38
Table 8 Ranking of Villages According to Consumption of Urea and DAP 39
Table 9 Ranking of Villages According to Utilization of Agri-Inputs Services by HHs 39
Table 10 Total and Average Demand of Agri-Inputs 40
Table 11 Technical Analysis for the Business of Agri-Inputs Products and Related Services 40
Table 12 Technical Analysis for the Business of Agri-Inputs Products Only 43
Table 13 Distributor Analysis for Fetilisers 43
Table 14 Distributor Analysis for Pesticides and Herbicides 45
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List of Figures
Figure No. Description Page

Fig 1 Phases of the Project 17
Fig 2 Enterprise Model of UJAS 27
Fig 3 Working Model of UJAS 29
Fig 4 Map of Mandla District 32
Fig 5 Land Use Classification 33
Fig 6 Land Holding Pattern in Sample Villages 35
Fig 7 Land Irrigation Pattern 35
Fig 8 Major Crops and Production 36
Fig 9 Estimated Demand of Agricultural Inputs and Services 37
Fig 10 Consumption Pattern of Seeds 38
Fig 11 4Ps and its Utilization in the Project 44
Fig 12 Productive Cycle of Time Saved 52
List of Abbreviations
BDS Business Development Service
UJAS Udyam Jagaran Sansthan
WEG Women Entrepreneur Group
VLSC Village Level Service Center
CLSC Cluster Level Service Center
GMT Grassroots Management Training
TEST Training of Enterprise Support Teams
WEMTOP Women’s Enterprise Management Training Outreach Program
FMCG Fast Moving Consumer Goods
DAP Di-ammonium phosphate
MOP Muriate of Potash
NBS Nutrient Based Fertilizer Subsidy
ICCO Interchurch Organisation for Development Cooperation
IFFCO India Farmers Fertiliser Cooperative Limited
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1. Introduction
Rural retail chain in India is not a new concept. When organized retail first made its presence
felt in rural India, it wasn’t a pure retailing operation targeting the rural masses. Companies
like DSCL and Godrej who had significant agri-business interests, set them up to meet the
needs of farmers in a store’s catchments area. A typical agri-input store would have a
catchment area of around 100 villages spread over 20-25 kms. While organized retail centred
on these stores, unorganized retail revolves around the local village shop and the haat. Shops
are usually present in villages with a population of more than 500 people. They stock more
product categories than what similar urban shops would, but there isn’t much variety offered
within a category. The rural retail now accounts for over one-third of the market for most
durable and non-durable products.
Agricultural inputs are also one of the major products which have been in the spotlight for a
long time in the agri-business stores such as DSCL’s Hariyali Kisaan Bazaar Chain and
Godrej Agrovet’s Aadhaar. Udyogini has tried to replicate the same model of these agri-input
stores model but in a rather small scale. Madhya Pradesh has unique topography, soil and
weather, which is one of the major reasons that the impact of green revolution had been
negligible on the agriculture sector of the state. Udyogini wants to tap this potential and to
venture more into this business wanted to do a feasibility study of the same.
As part of the Management Traineeship Segment, the major objective was study of existing
supply chain established by Udyam Jagaran Sansthan (UJAS), identify problems in its
operation and checking the feasibility of distributing agricultural inputs through the Village
Level Service Centres (VLSCs) of the supply chain of UJAS in the Mandla district of
Madhya Pradesh. A study in both financial and operational aspects of different opportunities
was carried out to understand the various perspectives for the initiatives undertaken by
Udyogini. In order to identify challenges for the organization in current and future context
different concepts that were learnt in the classroom were utilized. The period of the study was
from the 6th of July to the 6th of September 2010.
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1.1. Organization Overview:
Udyogini - means woman entrepreneur. Udyogini, the organization, works with poor women
to improve their skills as producers and their knowledge of the markets they operate in, so as
to ensure long-term returns
Udyogini, an NGO set up in 1992, has been working for the capacity building of poor women
through micro-enterprise development and its management. Udyogini was set up to co-
ordinate and facilitate management training for women’s groups at the grassroots under the
World Bank Institute funded Women’s Enterprise Management Training Outreach Program
(WEMTOP). This was a three-year participatory action learning project aimed at
strengthening the capacity of intermediary NGOs to deliver management training to poor
women micro entrepreneurs. The training program consisted of Grassroots Management
Training (GMT) carried out for women producers and the Training of Enterprise Support
Teams (TEST) for the trainers of GMT. In 2002, as a result of a strategic planning process,
Udyogini made changes in implementing strategy, deciding to initiate programs to engage
directly with women producers at the grassroots.
Back in the early 1990s, when Udyogini was established, the focus on microenterprise
management training was innovative at a time when even microcredit was a new idea.
Udyogini took an early lead in the domain by motivating smaller NGOs towards
microenterprise in their portfolio of programs for poverty alleviation for women. It enabled
NGOs, through a program of sustained support comprising training for enterprise awareness,
management and counseling, to move into developing microenterprise programs and having
staff with orientation to microenterprise. The NGOs that have grown and now have
established microenterprise programs such as URMUL, SURE and LUPIN in Rajasthan;
NIPDIT and Samanwita in Orissa and ADITHI in Bihar are distinguished alumni of Udyogini
enterprise motivation and management training.
Its intervention at Mandla district, M.P began in 13 villages to support around 200 women.
They work in two clusters namely Babaliya and Bakori at Mandla district. By the end of
2005, Udyogini worked with nearly 1200 women from 60 villages.
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1.2. Project Overview:
As part of the business development service, Udyogini has established a rural retail chain in
the form of Village Level Service Centers (VLSC) by imparting training and skill
development to women and also providing financial support to open VLSC and enhance their
livelihood. The VLSCs are linked with their cluster counterpart known as Cluster Level
Service Centers (CLSCs), CLSCs are working as wholesaler by providing the retail products
to the VLSCs and procuring the commodities from them. Although the organization is
expanding in terms of opening up new VLSCs but the profit is not increasing in the same
proportion therefore the organization is willing to find out the problem in the supply chain
and take required step to resolve it.
The operation area of the organization at district have agriculture as their primary occupation
by looking up this as an opportunity to sell agriculture inputs and related services through
VLSCs and thus increase both profitability and loyalty of the VLSCs entrepreneur,
Udyogini desires to have the feasibility study for the distribution of the agriculture-inputs and
farm equipments on lease through Village Level Service centers (VLSC) and to develop a
sustainable business model for the same. By this the organization not only wants to
strengthen the women entrepreneurs who are operating the VLSC but also help the farmers at
their agriculture activities with keeping the business interest.
1.3. Rationale of the study:
Even though the numbers of the VLSCs are increasing in past few years, the profitability is
not increasing proportionately thus there is a need to appraise the situation of the supply
chain to identify the problems. For the feasibility study of the distribution of the agriculture
inputs and related services the rationale lies behind primary occupation of the state and the
project area. Though the contribution of the primary sector, which includes agriculture, to the
total Net State Domestic Product is gradually coming down, agriculture is still the mainstay
of the state economy, as about 71% of the population is still dependent on agriculture. Thus it
clearly state that agriculture is the major livelihood activity in the region but still it contribute
least in the GSDP and NSDP of the Madhya Pradesh.
The Mandla District, our area of study is also representing the same picture. The major
constraints in the low agriculture productivity in the region are as follows
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 Fragmented and small land holdings.

 Low soil depth poor soil condition and Rain fed agriculture.
 Traditional agricultural practices (lesser utilization of fertilizers, pesticides,
herbicides, traditional agricultural tools and techniques).
 Limited availability of agriculture input and services.
 Other challenge lays in the heterogeneity of demand and spread of the rural villages
which results in poor connectivity with agriculture market.
Thus there is need of understanding the demand of agricultural inputs and related services of
the people in the region and based upon this develop a business model/supply chain to fulfil
their needs at their own villages that too at fair prices. This can help them to increase the
productivity in near future.
1.4. Objective of the study:
The study is focused to find out the problems in operations of UJAS after understanding their
supply chain and assess the feasibility of the distribution of agriculture inputs and related
services in the target villages. The long term goal of the study is to increase the profitability
of CLSCs, VLSCs and the agricultural productivity in the study area. To achieve this goal
following objectives have been defined:
 To study the supply chain of the UJAS and find out the problems in its operations
 To estimate the demand for agricultural inputs and other related services in the
targeted villages
 To find out the potential competitors and suppliers for the business
 To develop business model/supply chain for the agriculture inputs and services in the
target village
1.5. Scope of the Study:
The information, suggestions and opinions made can help in strategic planning for
developing the business plan for the distribution of the agriculture inputs and other related
services to increase the productivity in long term. The primary data collected regarding
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agriculture demand, market analysis, competitor analysis and distributor interviews at

sample villages and systemic knowledge generated by this would result in the creation of a
resource for other future studies. The academic study that arises from the project would
provide a model for similar work elsewhere.
1.6. Designated Project Area:

 For the Supply chain analysis the study was conducted in 10 villages of Babaliya and
Bakori clusters of Mandla district of Madhya Pradesh.
 For feasibility study of distribution of the agriculture inputs and farm equipments on
lease through VLSCs the study was conducted in 20 villages of Babaliya, Niwas and
Maneri clusters of Mandla and Jabalpur districts of Madhya Pradesh.
1.7. Limitations of Study:
 The time period was not sufficient for studying the different dimensions and details which
would have been more beneficial.
 As some of the villages are not in the operational areas of the organization, lack of basic
information about village caused difficulty in data collection.
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2. Methodology
Phases
Phase 1
(Background Phase 2
Study)
Questionnaire Data
Discussion With Sample Development Collection
Udyogini Staff Design
Data
Analysis
Report
Writing
Fig 1: Phases of the Project
Phase 1:
The phase 1 of the project consisted of the background study on agricultural inputs used in
Madhya Pradesh, the demographic features and agricultural pattern. It includes detailed
discussion with the staff of Udyogini and based on the discussion and background study the
questionnaires were developed for primary data collection.
Phase 2:
The phase 2 of the project consisted of the field work for the data collection from the
respondents. Various statistical tools were applied to analyze the data. The report was
prepared on the analyzed data.
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2.1. Sample Design and Sampling Method:
For supply chain analysis random sampling was done. The house hold survey was done by
taking sample size of 20 percent of the households of the 10 study villages. The feasibility
study of distribution of agriculture inputs and related services was done in purposive
sampling which was done by dividing into non-overlapping groups of farmers who own land
and non-farmers; the sample size was 25 percent of the farmer households of the villages.
The respondents were randomly selected based on their availability and willingness to
participate in the survey. The farmer households of the 20 villages of Maneri, Babaliya and
Niwas clusters were the universe for the study with one farmer as unit of the study. The
purpose of the survey was conveyed to the farmers before starting the survey.
2.2. Survey Design:
For primary data collection for supply chain analysis and problem identification,
questionnaires were designed for household surveys and VLSC’s entrepreneur interviews.
The checklist for focus group discussion was also designed. For feasibility study three
questionnaires were designed in order to get information from the stakeholders. First
questionnaire was designed for the farmers who use any kind of agricultural inputs and
services; the second questionnaire was designed for competitor analysis to find out the
potential competitors and the third questionnaire was designed for the structured interviews
of distributors of Mandla and Jabalpur districts to find out the potential suppliers.
2.3. Data Collection
Since the research involved analysis on both the product and the process, the data was
collected for both.
2.3.1. Product data collection – The data on product was collected from potential
customers. The data was collected through both questionnaire and discussion
based methodology. The data here was collected to know about the preference
and usage of farmers/ consumer towards agri-input products/ retail products and
their perceived demand.
2.3.2. Process data collection – This data was mainly collected on what the ongoing
process was and how it could be improved. For supply chain analysis and
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problem identification data was collected by structured interviews of the VLSCs

entrepreneur and FGD at assigned villages. Interview of CLSCs operator was also
taken to understand the operation and problems faced. For feasibility study this
data was first collected from retailers and government cooperatives of the study
area; how agri-inputs were availed from district level distributor and how do they
sell it to farmers, what was the potential demand. Second, the data was collected
from district level distributors about how the supply chain works.
2.4. Data Analysis
The data collected was analyzed using various statistical tools after tabular and graphical
summarization of the raw data. After the data analysis the final conclusion were drawn and
these conclusion along with personal observations at field formed the basis for
recommendations.
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3. Literature Review
With over 12 million retail outlets, India has one of the highest densities of retail outlets in
the world with one retail outlet for approximately 90 persons. Retailers inspired by the Wal-
Mart story of growth in small town America are tempted to focus on smaller towns and
villages in India. However, a careful analysis of the town strata-wise population, population
growth, migration trends and consumer spend analysis reveals a very different picture for
India
(www.researchandmarkets.com/reports/236028/indian_retail_industry_strategies_trends_an
d.pdf).
After a long spell of shortages, which shackled consumer buying for decades, retail is
becoming India's new mantra. While the retailing industry itself has been present through
history in our country, it is only the recent past that has witnessed so much dynamism.
We have entered the 21st century at a time when the demography of our population is
changing significantly to drive organized retail growth. India now has a large young working
population with a median age of 24. The number of nuclear families in urban areas is
growing fast. Then there is the increase in working women population. Add to these the
emerging opportunities in the service sector. Lifestyle habits are shifting from austerity to
complete self-indulgence and Indians are now unapologetic about spending lavishly on non-
essential goods such as luxury watches, cars, and hi-tech products.
India can be said to have entered the second phase of retail growth when there is high-speed
growth. There are retail chains like Tata's Westside, Pantaloon's Big Bazaar and Rahejas'
Shoppers' Stop, to name a few, along with global players such as McDonald's and Benetton,
trying to tap country's vast potential. Bringing all these under one roof are mega malls such as
Lifestyle, Fun Republic and Big Bazaar (Business World,
http://www.tsmg.com/download/article/TSMG_Tata_Review-June_2006.pdf).
Now, top names in international malls such as Marks and Spencer and Mango are also eying
the Indian market. It is only later that the retailing scene will move to the other phases when
the fruits of rapid growth will result in economies of scale and greater efficiency leading
finally to consolidation through mergers and acquisitions. Thus, retailing in India has a very
long haul ahead.
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In India for a long time a large chunk of retail outlets were grocery shop. This pattern had
been changing in recent years, in urban and rural markets.
Of late, India's largely rural population has also caught the eye of retailers looking for new
areas of growth. A slew of supermarket chains, including those of the Tata and ITC, are set to
storm the rural areas of the country as corporate realize the huge potential of the untapped
market. ITC launched the country's first rural mall 'Chaupal Sagar', offering a diverse product
range from FMCG to electronic appliances to automobiles, to fertilizers in an attempt to
provide farmers a one-stop destination for all of their needs. Companies such as Godrej and
DCM Shriram Consolidated are launching `one-stop shops' for farmers and their
communities. Godrej Agrovet, for instance, has planned to set up 1,000 Aadhaar stores across
rural India by the end of 2010. DCM Shriram has set up 302 rural/semi-urban utility marts
until June, 2009. Positioned as a one-stop shop, the Hariyali Kisaan Bazaar Chain caters to a
variety of farmers' needs by providing access to retail banking, fertilisers and other
agricultural inputs, LPG outlets and even a motorcycle showroom.
Fertilizer is key input in enhancing crop production. Fertilizer consumption and food grain
production is closely correlated. Presently fertilizer contributes about 50% to the total
increase in food grain production. Increasing pressure of population and shrinking land
resources demand for vertical expansion of agriculture where the role of fertilizers will
further increase. At the present level of nutrition, additional 150 million tons of food grain
production has to be achieved to feed almost 1.5 billion people by 2040. This estimate does
not include demand for animal feed, which will rise due to depleting grasslands. Thus, the
crusade of higher production of food grain has to continue with increased vigour using
fertilizers along with the other sources of plant nutrients.
(http://www.indiaretailing.com/news.aspx?topic=1&Id=3830)
The Union government has approved the Nutrient Based Fertiliser Subsidy (NBS) plan with
effect from April 1, 2010. This has a positive sentimental impact on share prices of fertiliser
companies. Under the new policy, the companies can fix retail fertiliser prices. However the
urea prices would be increased by Rs 483 per tonne or 10 per cent. This would lead to a
spiraling of fertiliser prices.
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The hike in urea prices is not going to impact the bottom-line or EPS of fertiliser companies
as extra 10 per cent will go from farmer’s pocket directly. However, looking at the shift in
policy, it’s a big positive for the industry.
Fertilisers are sold at government-fixed prices, which are lower than their costs of production
or import. The difference is met through subsidy. The NBS does away with maximum retail
price. It proposes to replace the current system of giving subsidy to the industry with direct
assistance to farmers. (The Economic Times)
Compared with last year, there is an increase of about Rs 4,000 crore in the plan allocation
for agriculture in this Budget. Also, flagship schemes such as the Rashtriya Krishi Vikas
Yojana have been given greater support. The Centre has cut fertiliser subsidy by Rs 3,000
crore from last year's allocation as part of its strategy to switch to a nutrient-based subsidy
policy. The Budget has made no substantial allocation for irrigation even as the farming
sector has suffered due to drought.
The move to decontrol prices of all non-urea fertilisers with effect from April 1, as part of the
changeover to a nutrient-based subsidy (NBS) regime, is supposed to help lessen the Centre's
subsidy burden.
But if the new rates of subsidy applicable on different fertilisers from the coming fiscal are
compared with their existing levels, a somewhat different picture emerges. In most products,
the subsidy payable to fertiliser companies will actually go up.
Di-ammonium phosphate (DAP), where manufacturers and importers are currently given a
concession of Rs 10,245 a tonne in return for selling at a controlled maximum retail price
(MRP) of Rs 9,350 a tonne.
In the event of decontrol, companies would technically enjoy the freedom to set their own
MRPs. Notwithstanding that, the Centre has decided to enhance the subsidy they would
receive on DAP sales by 59% to Rs 16,268 a tonne.
Likewise, the subsidy on mono-ammonium phosphate (MAP) has been raised by 104% and
that on triple super phosphate (TSP) by 38.5%. Earlier, there was no subsidy on ammonium
sulphate (AS), whereas now it has been fixed at Rs 5,195 a tonne, benefiting Gujarat State
KSRM 23
Fertilisers & Chemicals and Fertilisers and Chemicals Travancore. (Harish Damodaran, The
Hindu Business Line, New Delhi, Date: Feb, 2010)
KSRM 24
4. Analysis and Findings

4.1. Findings of study of supply chain analysis of UJAS
 Business Development Service (BDS)
BDS are a very important means of supporting the development of micro, small and medium
sized enterprises (MSMEs), which are known to create employment, generate income and
contribute to economic development and growth. Employment and income generation are
particularly important as far as impoverished rural areas, vulnerable communities and groups
are concerned. The intervention was grounded in the year 2003 and 60 villages of
Narayanganj Block was chosen for the intervention. The Block was chosen for its tribal
concentration and the potential of NTFP production as per the findings of the value chain
study. The five stages described from the standard operational model for Udyogini are:
 Enterprise motivation and management awareness for grassroots women

(Formation of Women Enterprise Groups and orientation through Grassroots
Management Training)
 Creation of grassroots business development service providers and entrepreneurs
(Advanced training and refreshers at the Udyogini School of Entrepreneurship)
 Enterprise promotion and incentives for producers and market players (value
chain creation, product and market research and linkages, enterprise investment
models and financial linkages, social services)
 Ownership and scale up through systems and institutions (producer companies,
private companies, non-profit societies)
 Expansion and outreach (services to other NGOs and clients; replication of model
in other areas)
 Udyam Jagran Sansthan (UJAS)

With a mandate to organize tribal women producers in the form of an institution so that they
take up the ownership and build their capacities and skills to undertake income generating
activities, an association of women NTFP collectors called Udyam Jagaran Sansthan
(UJAS), meaning “light”, was formed. UJAS was registered in 2005 under the M.P. Societies
Act, 1973. It is a federation of Women Enterprise Groups (WEGs) by virtue of their
involvement in enterprises at individual as well as on group basis. In 2008 the organization
KSRM 25
setup the rural retail chains in the form of VLSCs which are operated by women entrepreneur
selected from the WEG. The formation process of UJAS was participatory in nature and all
member SHGs/WEGs took part in the process. Decisions were made either by consensus or
through elections by group members. The governance structure of UJAS has two tiers. The
General Body consists of 34 members and the Executive Body consists of 9 members
including a President, a Secretary and a Treasurer. All the WEG members are equal
shareholders of UJAS by virtue of paying a onetime membership fee of INR 24 per member
on annual basis. The fee collection options are on monthly basis, which comes to INR 2 per
member or INR 24 up front, to meet the operating costs of BDSPs.
 Working Entrepreneurs Group (WEGs)

Women from 60 villages of Narayanganj block of Mandla district were organized into groups
called Women Enterprise Groups (WEGs). WEG, a group of 10-15 women, is similar to an
SHG and forms the foundation of the Udyogini enterprise model. More than 1,500 women
have been organized in 127 WEGs which are engaged in different microenterprise activities
besides the thrift and credit activities at individual and group levels. The women members are
represented by Gond (73 per cent), Baigas (11 per cent), Yadavs/Ahirs (7 per cent), Banjara
(7 per cent), Pankas, basket weaving community of Dhulias (1 per cent), and Lohaar and
Vishwakarma (1 per cent).
The basic design and the objective of the intervention were to inculcate entrepreneurial skills
in the WEGs and its members. Udyogini started the intervention with capacity building of the
WEGs through facilitation of workshops on “Orientation to Microenterprise”. These
workshops and exposure visits provided the WEG members with information on available
financial and non-financial resources and basics of enterprise management. In addition to
regular savings, internal lending and book keeping, the WEGs were also trained in key
concepts of enterprise. The training was also intended to expose them to ideas beyond just
survival and subsistence for livelihood. The range of enterprises taken up by WEGs includes
drying and storing Mahua for trading, vermi-composting, vegetable cultivation, animal
husbandry and services (grocery shops, flour mill, oil extraction units and mini rice mills). Of
these, Mahua drying, storing and trading are the predominant components, making up 80 per
cent of the total. The WEGs that are involved in Mahua trade take credit from Udhyogini in
the form of revolving funds, take loans from banks or utilize the group corpus to which they
belong for borrowing. The model offers discretion to the WEGs to take up enterprises on a
collective basis or by any individual member
KSRM 26
 UJAS Governance
The leaders of UJAS were previously acting as BDSPs and were providing paid services such
as maintenance of accounts, forming new groups, training groups and also technical services
such as running trade centers and processing centers. These women are selected through a
definite selection process and then groomed to provide business development services in
group and enterprise management. Since the producers have been organized as UJAS, these
women are in the process of developing themselves as leaders at the village, cluster and
organizational levels and hand over the technical functions to paid employees and manage
their work. This is being carried out in a phased manner. As a first step, the President is
developing her leadership skills to the extent that she can provide direction and build the
capacity and groom other leaders from amongst the members.
 UJAS Operations
The enterprise model of UJAS revolves around the cluster-level service centers (CLSCs),
also termed as Business Growth Centres. These centers are currently doing procurement and
aggregation of commodities collected and produced by the members and supplying the Retail
products to the VLSCs. CLSCs are also assign the work of value addition in terms of
processing, drying, grading and selling the produce. These Cluster Level Centres (CLSCs)
are linked with 20 existing Village Level Centres (VLSCs), with the goal of institution of 500
more VLSCs till 2013. One VLSC is being instituted for every one village. In addition to the
trading centers, UJAS also has processing centers, chiefly two oil mills and one dal-cum-
flour mill out of which only the flour mill is in operation. These centers help in the primary
processing of commodities like oilseeds, pulses, maize and wheat, thus ensuring better
margins for the enterprise.
KSRM 27
Fig 2: Enterprise Model of UJAS
 Cluster Level Service Centres (CLSCs)

Cluster Level Service Center is like a whole sale agency for the VLSC from where they have
to purchase the products. These CLCs are run by the UJAS itself. The CLSCs are just
operational for the three days a week. CLSC charges 4% of Transaction cost or transportation
cost on each product to the VLSC. This 4% is operational cost of the CLC. E.g.: if the
wholesale price of the Parle-G biscuit is Rs.40/- then they give this Parle-G biscuits to the
VLSC at Rs.4.16/-. There are two CLCs, at Babaliya and Bakori clusters. The prices for the
procurement commodity/ NTFP are decided by the CLSCs, and they don’t have any
mechanism for the prices speculation they depend on their instinct and some time they talk to
local trader for the same.
The CLSCs of Babaliya and Bakori are collection centers working under the purview of
UJAS. The latter uses the channel of the CLSCs for social and financial intermediation and
the delivery is carried out by the VLSCs operating at the village level. All the VLSCs bring
their collect from their respective operating village to the CLSCs of Babaliya and Bakori and
buy there retail products from CLSCs.
KSRM 28
The business processes of procurement, weighing and payment for the produce are the
responsibility of the VLSCs stationed at the CLSCs.
 Village Level Service Centres (VLSCs)

The VLSCs are the agents of UJAS operating at the village level and are instrumental in
actualizing the action plan of the intervention through social and economic intermediation.
The procurement of the produce is carried out by the VLSCs at the village level, which work
on commission basis at the rate of INR. 25 per market day of any produce procured/collected.
The VLSCs are supposed to meet the critical business volumes by procuring the produce
from villages, irrespective of the members of the WEGs. However, no threshold or minimum
quantity is defined for VLSCs to sell to the CLSCs. At the village level, the produce is
collected either by VLSCs or the members of WEGs directly from the villagers or members
of the group and sold to the VLSCs at the price quoted by the BDS unit (Market Intelligence
wing of Udyogini). This is usually the block level market price. Thus the villagers get fair
price at their doorstep. UJAS did a business in 26 commodities during 2007-08 which
included cereals (paddy), Jatropha and NTFP. The total business volumes included
procurement of about 76,461 kg, to the tune of INR 9, 45,789 and sale, along with the
previous year’s stock (94,036.6 kg), to various market players to the tune of INR 11,28,285 .
NTFP sales accounted for 17.2 per cent of the total sale amount that year. The business
turnover of UJAS yielded profits of over 1.5 lakh. Since the UJAS is a not for- profit outfit,
the profits were used for meeting the shortfall of the various processing units and for
procurement of Mahua in the 2008 season. The trading of NTFP was primarily done at
Jabalpur and Mandla level.
VLSC also acts as a local retailer selling more than 30 FMCG products in the village.
UJAS/CLSC provides the VLSC with an initial FMCG products worth Rs 10,000/- with a
security of Rs 3000/-. The loan is interest free but the VLSC has to return the money in 3
years. The CLSC purchase the Retail product at whole sale rate from either Mandla or
Jabalpur and charge 4% transaction cost to the VLSC.
KSRM 29
Fig 3: Working Model of VLSCs
 Findings
 Problems with Procurement Business:
a. Poor pricing mechanism: Though Udyogini always offers fair price for the NTFP
and commodities (at Mandla Mandi rates), but according to the VLSC operators there
is a difference in the price of the NTFP and commodities as compared with the local
haats and traders.
b. High Dependency on CLSCs: VLSCs have to be dependent on the CLSCs at the
time of purchasing commodities from the villagers. If there is large volume (say) 100
Kgs, she has to inform the CLSC about the volume of NTFP and cash required and if
someone comes from the CLSC then only VLSC could procure that NTFP or
commodity as they don’t have the required cash.
c. Lack of proper Storage facility: Most of the VLSCs also don’t have the proper
storage place for storing the commodities and NTFPs if in case they have to store
them. Some of the VLSCs also complained that sometimes the CLSC operator doesn’t
KSRM 30
come and take the NTFPs when they had bought it on their behalf. As a result, with
poor storage capacities, majority of procured goods gets spoilt due to rodents and
moisture.
d. High Opportunity Cost for VLSCs: The VLSC earn Rs. 20/ quintal of commodity/
NTFP for cleaning the commodity and then selling it to CLSCs, which is purchased
by the villager either directly or through agents who are again member of WEG. The
agent gets Rs. 25/ quintal commission on the commodity. If the agent is not involved
then the VLSC earns that money. The entire procedure of cleaning grains like paddy
and wheat consumes whole day of VLSC operators which they could have utilized for
any other more economically benefitting activity like wage labour which is about INR
70 in their villages. Thus there is a high opportunity cost for them to be involved in
this minimal value addition to commodities or NTFPs.
e. No Community Mobilization: After FGDs and the household surveys we came to
know that at some of the villages, people do not know that VLSCs also procure
commodities and NTFPs.
f. Seasonal and Selected Procurement by CLSCs: The CLSCs don’t buy all types of
the commodities of the villages; they only buy some selected commodities that too on
the seasonal basis.
g. Presence of Strong Competitors: In all the villages majority of the people sell their
commodities and NTFPs to traders directly or at a local haat, they consider the
VLSCs as the last option for selling their commodities/ NTFPs as they think that they
cannot only bargain for good prices at haat but also can build their goodwill with the
traders who help them at thick and thins of life.
 Problems with Retail Business:

a. Transaction Cost: The CLSCs charge 4% of the selling price as transaction cost each
time something is bought from them by VLSCs. According to the VLSC
entrepreneurs they don’t have to pay such transaction cost if they buy the same thing
from independent wholesalers.
b. Price Discrimination: CLSCs don’t follow the market price fluctuation. If the price
of a particular commodity decreases in the market by Re. 1, it will not be reflected in
the prices of CLSCs. They would still sell the commodity at the same price as before.
c. Poor Location of VLSCs: Most of the VLSCs are not satisfied with location of the
shop and they also want better displays, racks and show cases.
KSRM 31
d. Supply Driven Product Line: Most of the VLSC complained that the product line is
supply driven not demand driven. It also came to knowledge from the FGDs that in
spite of the large demand of some essential grocery items the VLSCs don’t have them
as the CLSCs don’t supply them.
e. No Credit Facilities: CLSCs don’t provide the products to the VLSCs on credit but
they can get this facility from any local wholesaler.
f. Inadequate Stock: Most of the VLSCs complained that CLSCs have inadequate
amount of the products and although they have huge product line, it doesn’t coincide
with the demand.
g. No After-Sales Services: The CLSCs do not provide with the VLSCs any after-sales
services. For instance VLSCs sold solar lamps with a one year warranty but within 6
months’ of sales there were complaints regarding the lamps and all the sold lamps
were dumped into the VLSCs and CLSCs did not took back the lamps.
h. Inappropriate Working Hours and Days: The CLSCs are open thrice a week,
which makes the remote area VLSC center operators unable to reach them on the
stipulated time and place. Therefore they buy from other wholesalers operating in the
same area.
i. Distant Location of VLSCs from CLSCs: The VLSCs are generally located in
remote areas and the distance between the VLSCs and the CLSCs is very large
making it hard for the VLSC operators to buy the products and transport it back to the
VLSCs. And they also have to bear the transportation cost.
4.2. Finding and analysis for feasibility study of distribution of agriculture inputs
and related services
A feasibility study is essentially a process for determining the viability of a proposed

initiative and services and providing a framework and direction for its development and
delivery.
A typical feasibility study is done to:

KSRM 32
 Verify the community needs for the proposed activity or services and asses the overall
value the same (Demand analysis )
 Find out the potential competitors and suppliers (Market analysis)
 Determine the technical requirements (Technical analysis)
 Determine the cost and benefits (Financial analysis)
 Socio-economic analysis
 Formulate the delivery options and recommend the most effective delivery strategy
(Business model development)
4.3. Demand analysis of agriculture inputs and related services:
Demand analysis for agriculture inputs and related services was done in two phases. The first
phase was to gain some knowledge about the agricultural scenario in Madhya Pradesh in
which desk research was done, Mandla district and then at the target block of the district.
This phase also included extensive and productive discussion with the organisation staff for
target village identification and questionnaire development.
The second phase was field study to determine the demand of agriculture inputs and related
services at the study villages.
Major findings of demand analysis are as follows:
Mandla District:
Fig 4:Map of Mandla Table 1: Basic Information (MP)

Source: Census 2001
Agriculture:
Overview
KSRM 33
 Total geographical area: 965,559 hectares.
 Net sown area: 23% of total geographical area. Fallow land and land not available for
cultivation accounts for 13% of the total geographical area.
 Forest: 60%
 Cropping intensity: 149%
 Percent of net sown area irrigated: 7%
 Main occupation for 87% of all workers in the district is agriculture.
Land holding:
 40% of the farmers have very small holdings, avg. 0.45 ha accounting for 7% of the
total cultivated area.
 38% of the farmers have relatively large holdings, avg. 4.89 ha accounting for 79%
of the total cultivated area.
Fig 5: Land Use Classification

Source: Human Development Report Madhya Pradesh 2007
KSRM 34
Table 2: Land Use and Agriculture

Table 3: Per Capita Agriculture Production

4.4. Inferences from the Field Study:
The field study includes the survey of 20 sample villages to assess the demand of Agriculture
inputs and Farm equipments on lease in the villages. 597 farmer HHs were surveyed with the
sample size of 25% per village.
4.4.1. Land Holding Pattern:
Most of the farmers in the surveyed villages held small land holding, the following table and
graph shows the land holding pattern of the surveyed villages
KSRM 35
Land Holding/ No. of

Acre HHs Land Holding Pattern
Marginal (0-2.5)
Marginal (0 - 2.5) 181 24% 30%
Small (2.6-5)
Small (2.6 - 5) 273 46%
Large (More then 5)
Large (More than 5) 143
Table 4: Land Holding Pattern at Sample Village Fig 6: Land Holding Pattern in Sample Villages
Source: House Hold Survey
4.4.2. Land Irrigation Pattern
The graph shows that only 13% of the total land holding is irrigated, which follows the state
picture of rain fed agriculture with little or no irrigation facilities and use of irrigation inputs.
Land Irrigation Pattern

13%
Irrigated Land
87% Unirigated Land
Fig 7: Land Irrigation Pattern (Source: House hold survey)
4.4.3. Major crops production and area under crops
The two important food grain crops of the region are paddy and wheat, which contribute
about 53 percentage of the total production and 68.34 percentage of the total food grain
production. Pulses collectively contribute about 8.42 percentage of total food grain
production. Along with Paddy, Wheat, and Pulses; Maize and Minor millets are also grown
abundantly in the region. Among non food grain crops oilseeds like Ramtila, Rai, Alsi and
Tilli are cultivated in the region and contribute approximately 5.20 percentage of the total
production.
KSRM 36
At present, about 31.69 percentage of the total cropped area is under Paddy and about 21.25
percentage of the area is under Wheat. The oilseeds are cultivated under 9.11 percentage of
the total cropped area.
0%
4% 0%
Major Crops and Production
1%
Paddy
7% Wheat
Maize
32% Rahar
8%
Urad
4% Rai
Ramtila
3% Masoor
6% Kodo
Kutki
1% Chana
8% 21% Batra
5% Tili
Fig 8: Major Crops and Production Source: House hold survey
4.5. Demand estimation of Agriculture inputs in the village
Although the demand of the agriculture input is low still the study villages show the potential
for the agriculture inputs and related services.
The study show that among all the agriculture input urea, DAP and herbicides were mainly
used by the farmers in the villages. About 49% of the farmers used Urea at their fields and
mainly used for the wheat cultivation. DAP is consumed by 31% of the farmers and about 5%
of the farmer use herbicides with the approximately volume of 62.81 liters. Total estimated
demand of the urea in the sample village was approximately 788.33 quintals and that of DAP
was about 334.37 Quintals. Farmers buy urea and DAP mostly from the cooperatives at
subsidized rate or from the market. The purchase from the cooperative depends upon the land
holding. The major constrains for the use of the Urea and DAP by the farmers are
 Low fertility and poor soil quality of the land

 Farming on steep slopes causes the fertilisers to wash down with the running water
and ultimately rendering the utilization of fertilisers as ineffective
 Insufficient irrigation facilities due to geographical location, poor infrastructure and
unavailability of irrigation inputs
KSRM 37
Other than Urea, DAP and herbicides, the demand of other agriculture inputs are nominal.
Pesticides and vermi-compost are used by only 4 percent of the farmers. Vermi-compost was
used in the villages where MPRLP was operating and vermi-compost pits were built free of
cost. The use of other fertilizers like MOP, SSP and bio-fertilizers was negligible in this
region as only one farmer of the sample used MOP and bio-fertilizers.
Agriculture No. of
inputs and farmer Total Avg.
S.No. Services using Demand Demand
1 Urea 296 788.33 Q 0.68 Q
2 DAP 186 334.37 Q 0.58 Q
3 Vermi-compost 21 81.68 Q 0.99 Q
4 Herbicides 28 62.81 Lts 0.57 Lts
5 Pesticides 19 98.28 Lts 1.32 Lts
6 Paddy Seeds 27 46.02 Q 0.43Q
7 Wheat Seeds 24 51.79 Q 0.55 Q
8 Pulses Seeds 20 13.53 Q 0.17 Q
Table 5: Total and Average Demand of Agri-Inputs in Sample Villages**
**All the analysis has been done on following assumptions:
 It is estimated that 80% of households are farmers at the village
Total Estimated Demand of Total Estimated Demand of Plant

Fertilisers Protectors
7%
28% Urea 39%

Herbicides
65% DAP 61%
Pesticides
Vermicompost
Fig 9: Estimated Demand of Agriculture Inputs
Source: House hold survey

KSRM 38
Seeds Total Estimated Demand

Paddy 46.02 Q
Wheat 51.79 Q
Pulses 13.53 Q
Fig 10: Consumption Pattern of Seeds Table 6: Consumption Pattern of Seeds
Source: House hold survey
4.6. Demand estimation of Farm equipments on lease (Agriculture Services)
The major farm equipments on lease or agriculture services used in the villages were tractor,
thresher, irrigation inputs like diesel pumps, electric pumps, and spray pumps. 25.96% of
surveyed farmers used thresher on rent, 12.9% farmers rented diesel pump, 5.7% electric
pump, 9.21% of the farmers used tractors on rent and 4.69% take spray pump. Only 1.17% of
the farmers surveyed take plough on rent. The use of these equipments depended upon the
resource availability and geographical location of the villages. Most of the time the farmers
hired these equipments from co-villagers and also from neighboring villages or market
centers like Babaliya, Niwas, Pipariya, Dhanpuri, Kundum. The rent mainly depends on the
place of hiring. In all surveyed villages we observed that the rent on thresher is paid in kind
i.e. on an average 10 Kgs per quintal.
Agriculture Inputs Total HHs % of HHs Avg. Rent (Rs)

Electric Pump 34 5.70% 30/ Hr
Diesel Pumps 77 12.90% 50/ Hr
Kerosene Pumps 1 0.17% 20/ Hr
Tractor 55 9.21% 328/ Hr
Plough 7 1.17% 50/ Day
Spray Pump 28 4.69% 20/ Day
Thresher 155 25.96% 160/ Q
Soil Testing 16 2.68% 0
Table 7: Farm equipment on lease Utilization
KSRM 39
4.6.1. Ranking of the Villages according to Consumption Urea and DAP
The village were ranked according to the Average consumption of the Urea and DAP at the
villages by the farmers.
Village name Ranking Village name Ranking
Mehgaon 1 Chakdehi Rayyat 8

Lehsar 2 Bandariya 9
Amdari 3 Jamgaon 10
Lohari 3 Melhari 11
Mehra Sivani 3 Banar 12
Mawai Maal 4 Chhapra 13
Salepani 4 Malthar 14
Katangi 5 Tervani 15
Katang Sivani 6 Mawai Rayyat 16
Majhgaon 7 Sukhram 17
Table 8: Ranking of villages according to Consumption of Urea and DAP
4.6.2. Ranking of the villages for Farm equipment on lease Utilization:
The villages are ranked according to the Number of the Farmer HHs using/ hiring the farm
equipments at the villages. Farm equipments are Tractor, Thresher, Diesel Pumps, Electric
Pumps, and Spray Pumps.
Village Name Rank Village Name Rank

Majhgaon 1 Malthar 9
Lehsar 2 Tervani 10
Amdari 3 Mawai Rayyat 11
Mehgaon 3 Katangi 12
Jamgaon 4 Melhari 13
Banar 4 Katang Sivani 13
Salepani 5 Chhapra 14
Bandariya 6 Lohari 14
Mehra Sivani 7 Chekdehi Rayyat 15
Mawai Maal 8 Sukhram 16
Table 9: Ranking of villages according to utilization of Agri.-input services by HHs
KSRM 40
4.7. Market Analysis

4.7.1. Target Market
The market segment for agriculture inputs and related services are the farmer of the 20
surveyed villages which include farmers from the Babaliya, Niwas, and five villages of
Maneri cluster of the Mandla and Jabalpur district. The Maneri cluster is not the operational
area of the organization. Most of the villages are remotely located and approximately 5 - 6
Kms away from the nearest market/weekly haats. Although the organization is willing to start
the business in villages where it has VLSCs, it also is looking to expand to other remote
villages of the clusters.
Major market centers for the surveyed villages were Niwas, Babaliya, Pipariya, Maneri,
Dhanpuri and Kundum.
4.7.2. Market Size
In the absence of related secondary data or information and reliable primary information it
was assumed that total estimated demand was the market size for the study. The market size/
demand for agriculture inputs and farm equipments on lease are as follows.
S.No. Agriculture inputs Total Demand Avg. Demand/ HH

1 Urea 788.33 Q 0.68 Q
2 DAP 334.37 Q 0.58 Q
3 Herbicides 62.81 Lts 0.57 Lts
4 Pesticides 98.28 Lts 1.32 Lts
Table 10: Total and Average Demand of Agri-Inputs
S.No. Agriculture Equipments/Services Total HHs Avg. Rent (Rs)

1 Electric Pump 34 30/Hr
2 Diesel Pumps 77 50/Hr
3 Kerosene Pumps 1 20/Hr
4 Tractor 55 328/Hr
5 Plough 7 50/Day
6 Spray Pump 28 20/Day
7 Thresher 155 160/Q
Table 11: Farm Equipment on Lease Utilization
KSRM 41
4.7.3. Products and Services
As per the demand analysis, urea and DAP could be the main agriculture inputs, the other
inputs could be herbicides and pesticides. The major brands sold in the regions are Kisaan
Urea, Chambal Urea, IFFCO Urea, Navratan Urea, IPL DAP, PPL DAP and Navratan DAP.
As compared to Urea and DAP Herbicides and pesticides are having more product line and
brands.
Demand analysis shows that farm equipments on lease not only have less demand due to
natural, physical, geographical constraints like low soil depth, lack of irrigation facilities,
lack of proper electricity but also the people could get these equipments in their own
villages.
4.7.4. Competitor Analysis
The analysis was done in the villages which are market centers for agriculture inputs and
farm equipments for the study villages. The villages for competitor analysis were Babaliya,
Niwas, Maneri, Dhanpuri and Barela. Along with the competitor analysis distributor
interviews were taken at Mandla, Jabalpur and Barela to get further information required.
The competitors of the business were categorized in two groups.
1. Government operated Cooperatives

2. Private Retailers
4.7.5. Strength and Weakness of Competitors:
Government Cooperatives and Fair Shops
A) Strength
1. Competitive advantage of capital and investment
2. Flexible structure, policies and plan
3. Good customer relations
4. Fixed share in fertilizer production
5. Strong distribution channels
6. Deep market penetration
7. Also provide technical support
KSRM 42
B) Weakness
1. Not proper implementation of policies and plan
2. Black Marketing
3. Demand is more than supply
Private Retailers
A) Strength
1. They can sell the products in loose and at credit
2. Good customer relations
3. Save transportation cost as they don’t have to sell the product in villages
4. Agri-inputs and equipments centers are located at the market centres
5. Updated pricing strategies and mechanism
6. Diversified product portfolio as most of the retailers take it as a side business and
the retailers who deal in this business only have diversified product portfolio
along with good market penetration
B) Weakness
1. Most of the retailers do not have any license except the one who are engaged in
the business of agriculture inputs and equipments only
2. Most of the surveyed villages are remotely located
3. Most of the retailers do not have warehouses
4.8. Technical Analysis
The technical analysis is done assuming that the business is for the time period of five years
as the market conditions would change with time and the business would need other
requirements. The analysis is done for two approaches which are as following:
 Agricultural inputs products and related services
 Agricultural inputs products only
4.8.1. Technical analysis for the business of agricultural inputs products and related
services:
The essential requirements for the business of agricultural input products and related services
are enlisted below:
KSRM 43
Technical Inputs/ Requirements

Warehouse (capacity @ 800 sq feet)
Licenses for Fertilizers, Pesticides & Herbicides
Tractors with Trolley & Plough (1)
Diesel Pump set of 5 H.P (5)
Electric Pump set (2 H.P) (2)
Spray Pumps 15 Liters (20)
Thresher (2)
Weeder (40)
Hand Harrow (20)
One Manager
Two Agri Input Expert (for Research, Development and Training)
One Accountant
Two Supervisors
One Driver
One Watchmen
One Peon
Table 12: Technical Requirements for the Business of Agri-Input and Related Services
4.8.2. Technical analysis for the business of agricultural inputs products only:
Technical Inputs/ Requirements

Warehouse (capacity @ 800 sq feet)
Licenses for Fertilizers, Pesticides & Herbicides
One Manager
One Agri Input Expert (for Research, Development and Training)
One Supervisor cum Accountant (One for Warehouse)
One Watchmen
One Peon
Table 13: Technical Requirements for the Business of Agri-Inputs
KSRM 44
4.8.3. Marketing Strategy:
• Urea, DAP • Field

Demonstration
• Herbicides
• Training
• Pesticides
• FGDs with
• Farm Equipment
farmers
on Lease
Product Promotion
Place Price
• Villages of •Price derived by

Babaliya, Niwas pricing strategy
and Maneri
Clusters
Fig 11: 4Ps of Marketing
The 4Ps of marketing here should be utilized in the optimum way i.e. product, promotion,
place and price. Here also the same rule applies for the marketing strategy of distribution of
agri-inputs and related services. The organization should keep in mind these components so
as to devise an effective and efficient market competitive strategy. The pricing of the agri-
inputs can be derived by taking into account the prevailing price of the agri-inputs and arrive
at a selling price which would be beneficial to both the organization as well as the farmers at
large. The other P i.e. place or location are the 20 villages of Babaliya, Niwas and Maneri
clusters. The major products to be given attention here are urea, DAP, herbicides and
pesticides and also farm equipments. For the last P i.e. promotion, the organization should
engage in promoting their idea of distribution of agri-input products through VLSCs to the
community through various modes such as field demonstration, training and FGDs.
4.9. Inferences from Distributor Interviews:
The nearest big markets of agri-inputs and services are Mandla and Jabalpur of which
Jabalpur is the bigger of them. It is a hub of big distributors of agri-inputs and services in the
whole Mandla and Jabalpur. Dhanpuri is also a market for agri-inputs but not of that
magnitude. The details of the potential distributors for the business are described as followed:
KSRM 45
Distributor Analysis Fertilizers

Distributor' Location Can Selling Selling Transportation Cost Buyb
s Name Provide price of Price of ack
the Req. Urea DAP Facilit
Quantity y
Purohit Mandla YES Rs. Rs. 515/ 50 Will be borne by Distributor in YES
Traders 270/50 kg Bag off season or when Company
kg Bag give the Free on Road (FOR)
Aggarwal Jabalpur YES Rs. Rs. 518/ 50 Have to borne by UJAS or NO
Brothers 278/50 kg Bag Udyogini
kg Bag
Madhu Jabalpur YES Rs. Rs. 515/ 50 Will be borne by Distributor in NO
Fertilizers 270/50 kg Bag off season or when Company
Pvt. Ltd. kg Bag give the Free On Road (FOR)
Table 14: Distributor Analysis for Fertilizers
Distributor Analysis Pesticides & Herbicides

Distributor' Location Can Provide Discount Offered Discount offered Buyback
s Name the Req. on Pesticides on Herbicides Facility
Quantity
Krishi Dhanpur YES Up to 7% on MRP Up to 10% on NO
Jagat i MRP
Aggarwal Jabalpur YES Up to 7% on MRP Up to 10% on NO
Brothers MRP
Table 15: Distributor Analysis for Pesticides and Herbicides
4.10. Minimum Requirements for License:

In order to sell fertilisers it is necessary to obtain a license to sell from the District
Development Authority (DDA). In order to obtain the license the basic requirements are:
 Map of the warehouse

 Agriculture expert
KSRM 46
The procedure to obtain the license is as follows:
 Apply for the license in DDA Office, Mandla

 Pay a challan of Rs 1250/- in the account of DDA in SBI
 Approval of godown’s map in the name of the organization
 Produce a No Objection Certificate (NOC) from Gram Panchayat (in the prescribed
form of DDA) and from the distributor of fertilisers
 Submit the affidavit
This whole process takes 1-2 days.
4.11. Financial Analysis

The financial analysis is done assuming that the business is for the time period of five years.
The analysis is done for two approaches which are as following:
 Financial analysis for the business of agricultural inputs products and related services
 Financial analysis for the business agricultural inputs products only
4.11.1. Financial analysis for the agricultural inputs products and related services:
4.11.1.1. Fixed Cost Analysis for Five Years
Fixed Cost Analysis for five years (for Agriculture Input Products & Serviecs)
Farm Essential
Ye Ware- Equipme Manage- Maintenance
ar house Licensing Vehicles nts ment Cost Cost TOTAL
0 0 3250 580000 350000 0 0 933250
1 60000 0 0 0 522000 30000 612000
2 60000 0 0 0 522000 30000 612000
3 60000 3250 0 0 522000 30000 615250
4 60000 0 0 0 522000 30000 612000
5 60000 0 0 0 522000 30000 612000
TOTAL FIXED COST FOR 5 YRS 3996500
All the fixed cost would remain constant for the five years as the warehouse would be on
contract for five years.
KSRM 47
4.11.1.2. Variable Cost* Analysis for Five Years:
Variable Cost Analysis for Five years

Insur
Insura
ance
nce
Premi
Ye Premiu Electri- Cost of Cost of Cost of Cost of
um Total
ar m for city Bill Urea DAP Pest. Herb.
Transpor for
Wareh
tation Tract
ouse
cost or
0 0 0 0 0 0 0 0 0 0
1 161841 6645 452 6000 108000 87550 4944 21428 396860
2 168315 4652 484 6120 115560 93679 5290 22928 417026
3 175047 3954 517 6242 123649 100236 5660 24533 439839
4 182049 3361 554 6367 132305 107253 6057 26250 464195
5 189331 2857 592 6495 141566 114760 6481 28088 490169
TOTAL 2208090
*Assumptions:
 It is assumed that the transportation cost may increase by 4% per annum

 It is assumed that there will be minimum four trips for the transportation of agri-input
products from CLSCs to VLSCs per annum
 It is assumed that the procurement of agri-input products will increase by 7% as our
sales will rise by the same percent per annum
 It has been assumed the warehouse insurance premium will rise by 7% as the
procurement will also increase by the same percent per annum
 It has been assumed that the tractor insurance premium will decrease by 30% in first
year and thereafter it will decrease by 15% per annum
 It has been assumed that the electricity bill will increase by 2% per annum.
4.11.1.3. Sales* Analysis of CLSC
CLSC to VLSC
Particulars Rate Quantity Amount (INR)
Urea Urea @ Rs 280/ 50kg Bag 200 Quintals 112000
DAP DAP @ Rs 526/ 50kg bag 85 Quintals 89420
Pesticides
Bayer 1ltr @ Rs 218 12 ltrs 2616
DuPont 1 ltr @ Rs 228 13 ltrs 2964
KSRM 48
Herbicides
PI 1ltr @ Rs 1078 11 ltrs 11858
Bayer 1 ltr @ Rs 1048 11 ltrs 11528
Tractor Rs 330 per hour 633 hrs 204712.2
Diesel Pump Set Rs.40 per hour 7025 275380
Electric Pump Set Rs.40 per hour 3200 125440
Thresher Rs.100/quintal 3040 Quintals 297920
Weeder Rs.9/day 90 days 32400
Hand Harrow Rs.18/day 120 days 43200
Spray Pump Rs 11/ day 702 days 308880
TOTAL SALES (1st Year) 1518318
*Assumptions:
 It is assumed that we will meet 25% of the demand
 It is assumed that our pump sets will run for 5 hours for 5 days by one person.
 Weeder is used by 40 persons for 90 days @ Rs 9/ day
 Hand harrow is used by 20 persons for 120 days @ Rs 18/ day.
 Assumption is made that 2% of sales would be given to VLSC on electric and diesel
pump sets, tractor rent, thresher rent
4.11.1.4. Sales Flow* Analysis Year Wise:
Sales
Year Sales (in INR)
0 0
1 1518318
2 1624600
3 1738323
4 1860005
5 1990205
*Assumption: It has been assumed that our sales will increase by 7% per annum
KSRM 49
4.11.1.5. Financial Viability Analysis for CLSC
FINANCIAL VIABILITY ANALYSIS OF AGRI INPUTS AND SERVICES

YEAR 0 1 2 3 4 5 TOTAL
Total Fixed Cost 933250 612000 612000 615250 612000 612000 3996500
Total Variable Cost 0 396860 417026 439839 464195 490169 2208090
Total Cost (A) 0 1008860 1029026 1055089 1076195 1102169 6204590
Total Sales (B) 0 1518318 1624600 1738323 1860005 1990205 8731452
-
EBIT = (B-A) 933250 509458 595574 683233 783810 888036 2526862
Tax @ 2% pa 0 10189 11911 13665 15676 17761 69202
EAT = (EBIT- -
Tax) 933250 499269 583663 669568 768134 870275 2457660
The Break Even Point is Rs. 5349273, which is not coming in the five years of the business.
The Net Present Value (NPV) of total Cost is Rs. 4027825.94 and the Net Present Value
(NPV) is Rs. 1730767.38.
4.11.2. Financial analysis for the agricultural inputs products:

4.11.2.1. Fixed Cost Analysis for Five Years:
Fixed Cost Analysis for Five Years

Warehouse Maintenance
Year Rent Licensing Management Cost Cost TOTAL
0 0 3250 0 3250
1 60000 0 300000 6000 366000
2 60000 0 300000 6000 366000
3 60000 3250 300000 6000 369250
4 60000 0 300000 6000 366000
5 60000 0 300000 6000 366000
TOTAL FIXED COST FOR FIVE YEARS 1836500
All the fixed cost would remain constant for the five years as the warehouse would be on
contract for five years.
4.11.2.2. Variable Cost* Analysis Year Wise:
Variable Cost Flow Analysis for Five Years

Year Transportation Cost of
Cost of Cost of Cost of TOTAL
cost Electricity Bill Urea
D.A.P Pesti. Herbi.
0 0 0 0 0 0 0 0
1 7575 4200 108000 87550 4944 21428 233697
2 7878 4284 115560 93679 5290 22928 249619
3 8193 4370 123649 100236 5660 24533 266641
4 8521 4457 132305 107253 6057 26250 284842
5 8862 4546 141566 114760 6481 28088 304302
TOTAL Variable Cost for Five Years 1339101
KSRM 50
*Assumptions:
 It is assumed that we will meet 25% of our total estimated demand.
 It is assumed that our business will grow by 7% per year.
 It is assumed that the transportation cost may increase by 4% per annum.
 It is assumed that there will be minimum four trips for the transportation of agri-input
products from CLSCs to VLSCs per annum.
 It is assumed that the procurement of agri-input products will increase by 7% as our

sales will rise by the same percent per annum.
 It has been assumed the warehouse insurance premium will rise by 7% as the
procurement will also increase by the same percent per annum.
 It has been assumed that the electricity bill will increase by 2% per annum.
4.11.2.3. Sales Flow* Analysis Year Wise:
Sales Flow Analysis of CLSC for Five Years

Year Sales
0 0
1 230386
2 246513
3 263769
4 282233
5 301989
*Assumption: It has been assumed that sales will increase by 7% per annum.
4.11.2.4. Financial Variability Analysis:
FINANCIAL VIABILITY ANALYSIS OF AGRI INPUTS TOTAL

YEAR 0 1 2 3 4 5
Total Fixed Cost 3250 366000 366000 369250 366000 366000 1836500
Total Variable Cost 0 233697 249619 266641 284842 304302 1339101
Total Cost (A) 0 599697 615619 635891 650842 670302 3172351
Total Sales (B) 0 230386 246513 263769 282233 301989 1324890
EBIT = (B-A) -3250 -369311 -369106 -372122 -368609 -368313 -1850711
Tax @ 2% pa 0 0 0 0 0 0 0
EAT = (EBIT-Tax) -3250 -369311 -369106 -372122 -368609 -368313 -1850711
We can see from the above table that in none of the year we are making any profit.
KSRM 51
4.12. Socio-Economic Analysis
The foremost aim of any NGO is to help the community to increase their socio-economic
status keeping in regards the business aspect of the intervention. The products and services
provided by the business would not only be beneficial to the farmers but also help in
generation of additional employment. This business reinforces the vision, mission and goal of
Udyogini i.e. to empower women as an entrepreneur as the products would be sold through
VLSCs to the farmers in their respective villages. The other benefits associated with the
business are elaborated below:
4.12.1. Opportunity cost : Total cost method (TCM) has used to calculate the opportunity
cost.
 Estimation based on Primary Research
Average time spends in a year for availing Agri-inputs 32 hrs
Numbers of persons who collects Agri-inputs 296
Working hours in a day 8 hrs.
Wage earned in a day Rs. 70
 Calculation of Opportunity Cost
Total no. of hours in Ave. time spends *No. of 32 hrs.*296 9472 hrs.
a Year persons
Total no. of days In Total no. of hrs. / working 9472 hrs. / 8 1184
a Year hrs. in a day hrs.
Value of Agri Inputs Total on. Of days * wage rate 1184*70 Rs. 82880
KSRM 52
4.12.2. Advantages of the Project to the Community:
Following advantages can be there:
 Time can be Saved
The time consume by men can be saved if there would be the facility of agri inputs at their
door step in a reasonable cost which they can afford.
 Saved Time can be Utilised for other Economic Activities
The opportunity cost which lies in this plus the social cost to the village is huge. This time
can be utilized by the people to do other jobs like working in NAREGA and other Govt.
projects which will surely enhance their livelihood needs.
Fig 12: Productive Cycle of Time Saved
The saved time can be use for productive work that can be an additional source of income for
the family. The Major portion of the income is consume by the family either rest of the
income can be save and then invest in infrastructure like ,hand pump, well, house, vehicle,
home appliances etc to get a good quality of life which will further give them an additional
time to do some productive work.
Or some part of the income can be spend for paying to the services which can give them good
quality of life. These services can be safe drinking water, electricity, bio- gas connection,
sanitation etc. These good qualities of life help them to save their time which they can further
utilize in any productive work.
KSRM 53
The productive cycle of chain keeps on running until the saved time through good quality of
life is not utilizing by the person for productive work, increase expenditure on consumption
or give the preference to saving instead of spending on services or investment on
infrastructure
KSRM 54
5. Conclusion
After research and analysis it is concluded that the business of distribution of agricultural
inputs and farm equipments on lease is not feasible due to various reasons such as:
 The geographical conditions (poor soil quality, low soil depth, lack of proper
irrigation facilities, etc) of the villages are not suitable for extensive agriculture.
Therefore the demand of the products and services cannot be adequately increased.
 The purchasing power of the farmers is not sufficient to invest in the scientific
agricultural practices. It is evident from the fact that most of them are dependent only
on agriculture and mono-cropping is prevalent in the region. Their secondary
occupation comprises of agriculture labour and wage labour.
 The demand analysis shows that the demand for agricultural inputs and services is not
sufficient enough to start a new business. Market analysis shows that although the
competition is less in the region but due to the State government’s interventions it is
at disadvantage.
 The financial analysis shows that although there is profit in the business but the
amount is not sufficient enough to recover the cost incurred to start the business. The
breakeven point of the business is not reached even in the 5th year of the business. The
Net Present Value (NPV) at the discount rate of 15% shows a negative outcome
which indicates that it is wise not to invest in the business.
 Although it is not financially viable it can be socio-economically advantageous for
both the organization and the community.
KSRM 55
6. Recommendation
For Supply Chain of UJAS:
 Proper implementation of 4Ps should be followed in the operational areas of VLSCs.

 Variety, quality and quantity of the products offered by the CLSC should be increased.
VLSCs would like to see more variety in their retail products, since villagers demand for
these products, like medicines, soils, soap, oil etc.
 Operator’s knowledge about the prices in market should be increases so that he will be
able to advise and support the women when needed.
 Our research shows that women are motivated to improve or expand their business. In
order to be able to do this, the women would like to see that UJAS provided them with
credit facilities. Bookkeeping of Sales, procurement, stock, costs should be maintained.
 In order to reduce the operational cost of CLSC and to save the opportunity cost of
VLSCs, a mobile van concept could be implemented which would provide all the retail
products at the doorsteps of VLSCs. This would also be beneficial for the VLSCs
operators in reducing their transportation cost and might also increase their loyalty.
For feasibility of distributing agriculture inputs and services:
As the business is not financially viable and sustainable, the organization should not invest in
this business. They should expand the network of VLSCs which would help them to access
the market more which means to fulfill more demand.
The organization should also be engaged in promotion of some livelihood development

activities and skill/ capacity building of the people so that their purchasing power can be
increased. This would help the organization in two ways:
 Building repertoire with the community which will help the organization in their
future interventions.
 Once the purchasing power of the community increases any intervention of the
organization would be positively responded.
KSRM 56
7. References
Reports, 23602, Indian retail industry strategies trends. http://www.researchandmarkets.com
TSMG Tata Review, June_2006. Business World,

http://www.tsmg.com/download/article/TSMG_Tata_Review-June_2006.pdf
http://www.indiaretailing.com/news.aspx?topic=1&Id=3830
Harish Damodaran, (Feb, 2010), The Hindu Business Line, New Delhi,
Human Development Report Madhya Pradesh 2007
KSRM 57
8. Annexure
House Hold Survey for Supply Chain Analysis and Problem Identification
A. RESPONDENT’S PERSONAL DETAILS
1. NAME : ____________________________________________________________
2. VILLAGE : ____________________________________________________________
3. PANCHAYAT : ____________________________________________________________
4. BLOCK : _____________________________________________________________
5. DISTRICT : _____________________________________________________________
B. DETAIL OF THE WEG
1. NAME OF GROUP : ___________________________________________________
2. MEMBERSHIP SINCE : ___________________________________________________
3. ROLE IN THE GROUP : ___________________________________________________
4. MONTHLY SAVINGS : ___________________________________________________
5. TOTAL SAVINGS IN WEG : ___________________________________________________
6. CREDIT TAKEN : Yes/No, (1) Individual _____________ (2) Group__________
7. SOURCE OF CREDIT : From where (1) WEG _______________ (2) Bank_________
(3)Other:____________
KSRM 58
If yes, then how much? (In Rs.) 100-1000 [ ] 1000-2000[ ] 2000-5000 [ ] 5000+ [ ]
(b) Purpose of credit
Education
Health
Marriage
House Repair
Agriculture
To Repay Other Loan
Any Other (specify)
(a) Have you repaid your loan? (Y/N)
(b) If yes, than period of repayment.
0-3 Mth 3-6 Mth 7-12 Mth <12mth
(c) Percentage left: Nil > 25% >50% >75% >100%
(d) If No, then why_______________________________________________________
C. SOCIO-ECONOMIC STATUS
1. Number of family members: M___ F____ Total__________________
2. How many members are engaged in economic activity? _____________
3. Total monthly income of the family (In Rs.):
500-1000 1000-1500 1500-2000 2000-2500 2500+
4. Monthly Savings of the family (In Rs.) Nil [ ] 0-20 [ ] 21-50 [ ] 51-100 [ ] 101-500 [ ]
5. Source of Income:
Agriculture [ ] Labour [ ] N.T.F.P. Collection [ ] Animal Husbandry [ ] Business [ ]
Service [ ] Any other, Specify ___________________________________________

KSRM 59
D. CONSUMPTION DETAILS
1. Do you buy Commodities from a particular Shop? Y/N_____________
If yes, why? _________________________________________________
Reasonable price
Good Quality
Good Behavior of shop keeper
Easy to Reach
Good Collection of products
Provides Loan
Barter Facility
Any other (Specify)
2. Give Your Response in the Following Situations:
a. You get commodity better in quality but higher in price, then purchase decision, [Y/N]
b. You get commodity lower in quality and lesser in price, then purchase decision, [Y/N]
c. You get commodity on credit but in higher in price, then purchase decision, [Y/N]
d. You get commodity in exchange of your own products, then purchase decision, [Y/N]
e. You get commodity from Village shop. [ ] Haat [ ] Big Shop [ ]
f. You get commodity near to your home but in higher price, then purchase decision[Y/N]
g. You get commodity far from your village but at a lower price, then purchase decision[Y/N]
h. Preference of purchase. a. Village Shop ___________
b. Weekly haat ___________
c. Shop in nearby places ___________

KSRM 60
3. Mode of Purchase: Cash [ ] Credit [ ] Barter [ ]
 If Cash, Do you get some discount? _______________________
 If credit, then credit limit, _______________________
 Repayment Mode _______________________
 Repayment Time _______________________
4. What is the average amount of purchase per trip?
50-100 [ ] 100-150[ ] 150-200[ ] 250-300[ ] 300+ [ ]
5. What is the frequency of visiting the village shop?
Daily [ ] Alternate Days[ ] 3-4 days[ ] Weekly[ ] Fortnightly[ ] Monthly[ ]
6. If you were provided your commodities required at your doorstep at market price, would
You like to buy?
(a) If Yes, why? _______________________________________________________

_______________________________________________________
(b) If No, why? _______________________________________________________

_______________________________________________________
7. How would you describe your entire expenditure of a month?
S. No Expenditure Item Ranking % Share
1. Health.
2. Hospitality
3. Ceremonies & Celebrations
4. Clothing
5. Food items
KSRM 61
6. Education
7. Travel
8. Entertainment
9. Repair & Maintenance
8. Details of commodities purchased:
Quantity Type of Purchase

S. Freq. of Price
Categories Product (per Brand packagi P.O.P from Remark
No purchase range
month) ng whom
3 Pulse
10
Spices
11
12
13
14
15
16
17
18 Oil
19
20
KSRM 62
21
22
23
24
25
26
27
28 FMCGs
29
30
31
32
33
34
35
36
37
38 Cereals
39
40
41
42
Other items
43
44
9. What other services would you like to receive in a local retail shop?
a. PCO
b. Mobile recharge
c. DTH TV recharge
KSRM 63
d. Any other
E. PROCUREMENT:
Details of agricultural commodities produced
Name of Quantity of Quantity of home Quantity sold in the Whom do you sell?
consumption market
the commodity Production
Details of NTFPs collected
Name of Quantity of Quantity of home Quantity sold in the Whom do you

production consumption market sell?
the commodity
Any other (Specify)

KSRM 64
Place : Date:
Signature :
VLSCs / CLSCs Interview
Date …………………………….
KSRM 65
Haat / Shop…………………..
Name of the Respondent ……………………………………………..
Educational Qualification……………………………………………….
Location……………………………….
1. What are the Products you sell?

Product Product lines Major Selling Brands
1. …………………………… ( ) ………………….. …………………………………
2. …………………………… ( ) ………………….. …………………………………
3. …………………………… ( ) ………………….. …………………………………
4. …………………………… ( ) ………………….. …………………………………
5. …………………………… ( ) ………………….. …………………………………
6. …………………………… ( ) ………………….. …………………………………
7. …………………………… ( ) ………………….. …………………………………
8. …………………………… ( ) ………………….. …………………………………
9. …………………………… ( ) ………………….. …………………………………
10. …………………………… ( ) ………………….. …………………………………
11. …………………………… ( ) ………………….. …………………………………
12. …………………………… ( ) ………………….. …………………………………
13. …………………………… ( ) ………………….. …………………………………
14. …………………………… ( ) ………………….. …………………………………
15. …………………………… ( ) ………………….. …………………………………
16. …………………………… ( ) ………………….. …………………………………
17. …………………………… ( ) ………………….. …………………………………
18. …………………………… ( ) ………………….. …………………………………
19. …………………………… ( ) ………………….. …………………………………
20. …………………………… ( ) ………………….. …………………………………
2. In which month your shop
S. No. Category Months/Season Average Returns

1. Good
KSRM 66
2. Average
3. Bad
3. List the Commodities/NTFPS procured
S. No. Commodities/NTFPs Volumes Months/Season

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
4. How do you feel about the procurement business?
……………………………………………………………………………………………………………………………………………………..
5. What are your profits in the procurement of NTFPs/Commodities?
……………………………………………………………………………………………………………………………………………………..
6. What are the Records you maintain and method you follow?
………………………………………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………………………………………………
……………………
7. How do feel about the training provided by USE?

KSRM 67
………………………………………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………………………………………………
…………
8. What extent this training is helpful for your business?
………………………………………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………………………………………………
…………
9. What are your expectations from the training programme?
………………………………………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………………………………………………
………………
10. Comments of Surveyor
………………………………………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………………………………………………
………………………………………………………………………………………………………………………………………………………
……………..
Name of the surveyor
…………………………………………………………
Signature of the surveyor
………………………………………………………..
FGD Checklist
KSRM 68
Focus group interviews
Involving the community as new VLSC

Subject group: community members (men & women groups)
1. To what extent is the community aware of the purposes of UJAS?

2. To what extent is the community aware of the way the value chain system works?
3. What does the community think about UJAS? How do they feel about UJAS? Why?
4. What does the community expect from UJAS?
5. How do they feel about the current vlsc women?
6. How do they feel about involvement (training & education) of one woman per village?
7. Do community members see there is an added value of getting involved with UJAS as new
VLSCs? Why / why not?
8. What are the main issues on a daily basis of the woman?
9. What would stimulate the women of the community to become vlsc’s? (Open ended, but
some possibilities: Increase income / financial independence, work and take care of the
children at the same time, increasing knowledge)
10. What are the reasons not to get involved with the value chain?
11. With regards to their livelihood, what changes would the community like to see in the
future?
Loyalty of farmers towards VLSC

Subject group: farmers (additional questions men groups)
1. Concerning their business, what are the major problems of the farmers? (Necessary to
probe)
2. What causes these problems?
3. Do they feel that they have all the means necessary to yield a maximum benefit from their
land? Why / why not?
4. What causes this?
5. What does this mean for their daily lives?
6. If you would have 100.000 rupees to invest in your farm, what would you do?
7. How do the farmers feel about vlsc’s?
8. How often does it happen that they sell their produce to others then vlsc’s?
9. Why do they sell to others then vlsc’s
10. Do they feel they get fair prices with traders?
11. What is needed to keep the farmer trading with the vlsc as opposed to other traders? (which
incentives? open ended, but some possibilities: discount schemes, fair prices/ fair practices,
additional services like health services (which medicines are needed), loans, relations,
transport?
12. What other services are required from the vlsc’s? (open ended, but if suggestions are
necessary: pco, mobile recharger, dht tv recharge, solar lanterns, seeds, packet milk,
stationary items, vegetable saplings, fertilizer etc.)
KSRM 69
Household Survey Form for Feasibility Study of Distribution of

Agriculture Inputs and Related Services
Name of the farmer:
Land-holding (in Acres):
Irrigated land (in Acres):
Un-irrigated land (in Acres):
Cropping pattern:
Kharif Rabi Summer
Name of Area Production Name of Area Production Name Area Production

the crop (quintals) the crop (quintals) of the (quintals)
crop
Pattern of use of agricultural inputs:

Information regarding the agricultural inputs used by the farmer:
KSRM 70
Name of the Do you Quantit Any Wher Distance Who When Price
input use it? y used particul e do travelled do you is it range
(Yes/No) per ar you to buy it require
annum brand buy it purchase from? d?
used from? the input
Fertilizer:
1. Urea
2. DAP
3. MOP
4. Mixed
fertiliser
Seeds/seedlings:
Pesticides:
Bio fertilizers:
(e.g. rhizobium
for seed
treatment)
Irrigation inputs
Herbicide
Do you hire any other agricultural related services?
Name of the Do you hire the Who When is the service How much
service service? provides required and for do you pay
(Yes/No) you the what purpose? for it?
service?
1. Tractor
2. Implements
3. Sprayer
KSRM 71
4. Pump set
5. Soil testing
6. Any other
Name of the Surveyor:
Date: Signature
KSRM 72
Competitors Interview Questionnaire for Feasibility study
Competitor Analysis for Agriculture Inputs
Date …………………………….
Haat / Shop…………………..
Name of the Respondent ……………………………………………..
Location……………………………….
2. What are the Products you sell?

Product categories Product lines Major Selling Brands Price Range
21. …………………………… ………………….. …………………………………
……………………
22. …………………………… ………………….. …………………………………
……………………
23. …………………………… ………………….. …………………………………
……………………
24. …………………………… ………………….. …………………………………
……………………
25. …………………………… ………………….. …………………………………
……………………
26. …………………………… ………………….. …………………………………
……………………
27. …………………………… ………………….. …………………………………
……………………
28. …………………………… ………………….. …………………………………
……………………
29. …………………………… ………………….. …………………………………
……………………
30. …………………………… ………………….. …………………………………
……………………
KSRM 73
2. Major Products Sold to the Villages
S.NO Product Name Villages Volume Months/Season

1 Urea
2 DAP
3 Other Fertilizers
4 Herbicides
5 Pesticides
6 Paddy Seeds
7 Wheat Seeds
8 Pulses seeds
9 Oil seeds
10 Vegetables seeds
11 0thers
Supply Chain for Retail and Procurement Business for agriculture inputs.
Supply Chain for Retail Business
1. To whom and where do you sells the products (Villagers/Local Retailers/Haat/Other)

……………………………………………………………………………………………………………………………………………
…..
……………………………………………………………………………………………………………………………………………
…..
2. How do you transport the products
…………………………………………………………………………………………
3. What is the average cost incurred and who bears that
cost………………………………………………………
4. To how many villages you sell your
products…………………………………………………………………………….
5. Do you move to any haat, if yes
specify……………………………………………………………………………………
KSRM 74
6. Do the Prices varies by moving to haat

……………………………………………………………………………………
Supply chain for Procurement Business
1. Where do you procure the products? (specify Name of the distributor & location)
……………………………………………………………………………………………………………………………………………
……………………………………………………………………………………………………………………………………………
2. What are the major products you procure?
S. No. Products Types Brands Month/Season Avg. Volume Avg.

Price
1
2
3
4
5
6
8
9
10
3. How do you transport the procurements and average cost incurred for that?
………………………………………………………………………………………………………………………………………………………
……………………………………………………………………………………………………………………………………………………….
4. Who bears transportation cost?
………………………………………………………………………………………………………………………………………………………
…
5. What is the competitive advantage of buying from that distributor?

KSRM 75
.........................................................................................................................................................
..
………………………………………………………………………………………………………………………………………………………
….
6. What is your wear house capacity?
…………………………………………………………………………………………………………………………………………………
…………………………………………………………………………………………………………………………………………………
…………
Services provided for Procurement Business
1. What are services the distributor provides you?

1. Credits/Adv. Yes/ No …………….. Avg. Credit/Adv. Limits ……………….
Interest rate (Monthly/ Annual) …………… Avg. Recovery Period …………………..
Recovery Mechanism ……………………………… Recovery Rate ……………………………..
2. Does the distributor provide you the buyback facility? If yes then to what extent
…………………………………………………………………………………………………………………………..
3. Does the distributor provide you any discount and at volume of purchase?
……………………………………………………………………………………………………………………………...
4. Does the distributor provide you any incentives?
……………………………………………………………………………………………………………………………..
5. Any others services ……………………………………………………………………………………………..
…………………………………………………………………………………………………………………………….
Services provided for Retail Business
1. What are services you provide to your retail customers?

1. Credits Yes/ No …………. Avg. Credit Limits ………………………..
Interest rate (Monthly/ Annual) …………… Avg. Recovery Period …………………..
Recovery Mechanism ……………………………… Recovery Rate ……………………………..

KSRM 76
2. Other Agriculture related services on rent.
S. No. Services Rent amount (Rs.)
1 Pump Set(Diesel/ Electric/Kerosene )
2 Tractor
3 Spray Pump
4 Thresher
5 Weedier
6 Hand harrow
7 Other
3. Do you allow Barter System Yes/ No ………

With which commodities …………………………………………………………………………………..
…………………………………………………………………………………………………………………………….
4. Any others services ……………………………………………………………………………………………..
…………………………………………………………………………………………………………………………….
5. If we purchase the agriculture inputs from you at bulk what price you offer to us at
what volume?
……………………………………………………………………………………………………………………………………………………….
.
……………………………………………………………………………………………………………………………………………………….
.
………………………………………………………………………………………………………………………………………………………
…
……………………………………………………………………………………………………………………………………………………….
.
KSRM 77
6. What are the services you will provide to us? Like buyback, transportation etc
………………………………………………………………………………………………………………………………………………………
…
………………………………………………………………………………………………………………………………………………………
….
………………………………………………………………………………………………………………………………………………………
…
……………………………………………………………………………………………………………………………………………………….
.
7. Comments of the surveyor

…………………………………………………………………………………………………………………………………..
………………………………………………………………………………………………………………………………….
………………………………………………………………………………………………………………………………….
………………………………………………………………………………………………………………………………….
Name of the surveyor ………………………………………………………………….
Signature of the surveyor ……………………………………………………………..
Table 1:Village-wise Consumption of Agri-input And Services

KSRM 78
Average Consumption per Village Irrigation Inputs Seeds

Village Name
Urea (Quintal)DAP (Quintal)
Herbicides (HHs)
Pesticides Spray
(HHs) Pump (HHs)Tractor (HHs)Thresher (HHs)
Diesel Pump (HHs)
Electric Pump (HHs) Paddy (HHs) Amount used (Quintal)WheatAmount
(HHs) used (Quintal)
PulsesAmount
MaizeAmount
Mehra Sivani 14.4 11.82 0 0 0 7 11 0 0 5 3.05 4 2.35 0 0 2 0.08
Lohari 20.15 3 1 0 0 2 0 1 1 0 0 0 0 1 1 0 0
Amdari 19.48 9.21 1 1 2 3 8 4 0 2 0.35 1 0.1 0 0 0 0
Mawai Rayyat 1.06 0 1 0 1 1 0 1 0 1 1 1 0.5 0 0 0 0
Mawai Maal 4.55 2.25 0 2 0 2 1 2 0 4 2 0 0 0 0 0 0
Banar 10.65 5.95 0 2 0 6 23 9 1 5 1.3 1 0.05 7 0.75 0 0
Majhgaon 12.35 3.32 0 1 0 9 12 3 0 1 0.2 0 0 2 0.2 1 0.04
Chhapra 11.58 5.45 0 0 0 0 4 7 0 1 0.03 0 0 0 0 1 0.02
Chakdehi Rayyat 13.65 2.4 0 0 0 1 0 2 0 0 0 0 0 0 0 0 0
Malthar 4.5 0.7 2 0 0 3 1 4 0 1 0.5 1 1 1 0.02 1 0.2
Bandariya 3.65 1.1 0 0 0 1 3 2 0 0 0 0 0 0 0 0 0
Katang Sivani 6.23 3.55 0 2 0 2 2 1 0 1 1 2 0.3 0 0 0 0
Sukhram 2.13 1.47 0 0 0 0 0 0 0 1 0.1 0 0 2 0.1 0 0
Lehsar 12.75 6.65 6 5 8 2 18 0 15 0 0 6 2.85 2 0.5 0 0
salehpani 13.75 4.5 9 0 6 0 18 0 13 3 0.7 0 0 0 0 0 0
Mehgaon 29.75 15.05 5 4 4 11 30 0 1 0 0 6 4.3 3 1.15 0 0
Katangi 9.15 3.3 0 0 0 0 5 0 3 0 0 1 0.25 0 0 0 0
Jamgaon 10.55 7.3 0 0 0 5 19 18 0 0 0 1 0.5 0 0 0 0
Melhari 1.35 0.5 1 1 1 1 0 2 0 2 1.4 0 0 1 0.03 0 0
Tarvani 6.5 1 0 3 0 0 0 21 0 1 0.1 0 0 1 0.2 0 0
Table 2: Ranking of Villages according to Agri-Inputs and Related Services

Urea consumption
Village Total No. of Avg. Total No. % of HH Avg. Ranking
name Consumption HHs Urea of HHS using Consumptio of
(Quintals) used per Urea n per villages
HH Village
Mawai 1.06 3 0.35 55 5.45 1.93 18
Rayyat
Melhari 1.35 3 0.45 84 3.57 1.61 20
Shukram 2.13 8 0.27 120 6.67 1.78 19
Bandriya 3.65 5 0.73 50 10.00 7.30 9
Malthar 4.5 7 0.64 120 5.83 3.75 15
Mawai Mall 4.55 6 0.76 65 9.23 7.00 10
Katang 6.23 16 0.39 120 13.33 5.19 11
Sivni
Tervani 6.5 31 0.21 184 16.85 3.53 17
Katangi 9.15 9 1.02 80 11.25 11.44 5
Jamgaon 10.55 21 0.50 250 8.40 4.22 13
Banar 10.65 21 0.51 300 7.00 3.55 16
Chapra 11.58 20 0.58 300 6.67 3.86 14
Majhgaon 12.35 16 0.77 250 6.40 4.94 12
Lehsar 12.75 11 1.16 120 9.17 10.63 6
Chekdehi 13.65 22 0.62 150 14.67 9.10 8
Rayyat
Salepani 13.75 21 0.65 150 14.00 9.17 7
Mehrasivni 14.4 14 1.03 120 11.67 12.00 4
Amdari 19.48 11 1.77 120 9.17 16.23 3
KSRM 79
Lohari 20.15 17 1.19 120 14.17 16.79 2

Mehgaon 29.75 28 1.06 170 16.47 17.5 1
DAP consumption
% of
Tota HH
No.
Village name Total Avg. l No. usin Avg. Rankin
HHs
Consumptio Consumptio of g Consumptio g of
n (Quintals) n per HH HHS DAP n per Village villages
Mawai Rayyat 0 0 0 55 0 0 18
Melhari 0.5 1 0.5 84 0.01 0.006 16
Malthar 0.7 3 0.23 120 0.03 0.006 16
Tervani 1 6 0.17 184 0.03 0.005 17
Bandriya 1.1 3 0.37 50 0.06 0.022 10
Shukram 1.47 5 0.29 120 0.04 0.012 15
Mawai Mall 2.25 3 0.75 65 0.05 0.035 6
Chekdehi
Rayyat 2.4 8 0.30 150 0.05 0.016 13
Lohari 3 4 0.75 120 0.03 0.025 9
Katangi 3.3 3 1.10 80 0.04 0.041 5
Majhgaon 3.32 9 0.37 65 0.14 0.051 14
Katang Sivini 3.55 9 0.39 120 0.08 0.030 7
Salepani 4.5 3 1.50 150 0.02 0.030 7
Chapra 5.45 10 0.55 300 0.03 0.018 12
Banar 5.95 14 0.43 300 0.05 0.020 11
Lehsar 6.65 8 0.83 120 0.07 0.055 4
Jamgaon 7.3 9 0.81 250 0.04 0.029 8
Amdari 9.21 13 0.71 120 0.11 0.077 3
Mehra Sivni 11.82 13 0.91 120 0.11 0.099 1
Mehgaon 15.05 24 0.63 170 0.14 0.089 2
Pesticides consumption
Village Total No. Avg. Total No. % of HH Avg. Ranking
name Consumption HHs Consumptio of HHS using Consumptio of
(LTRS) n per HH Pest. n per villages
Village
Mawai 0.75 1 0.75 55 1.82 1.36 5
Rayyat
Amdari 0.1 1 0.1 120 0.83 0.08 7
Melhari 2 1 2 84 1.19 2.38 1
Lohari 2.75 1 2.75 120 0.83 2.29 2
Malthar 2.5 2 1.25 120 1.67 2.08 4
Mehgaon 1.5 5 0.3 170 2.94 0.88 6
Lehsar 2.5 6 0.41666666 120 5.00 2.08 4
7
Salepani 3.4 9 0.37777777 150 6.00 2.27 3
KSRM 80
Herbicides consumption
Village Total No. Avg. Total No. % of HH Avg. Ranking
name Consumption HHs Consumptio of HHS using Consumptio of
(LTRS) n per HH Pest. n per Village villages
Majhaon 2 1 2 65 3.077 6.15 2
Amdari 0.1 1 0.1 120 0.083 0.01 9
Melhari 1 1 1 84 1.190 1.19 4
Mawai 2 2 1 65 1.538 1.54 3
Mall
Katang 1.25 2 0.63 120 0.521 0.33 6
Sivni
Banar 0.7 2 0.35 300 0.117 0.04 8
Tervani 1.5 3 0.5 184 0.272 0.14 7
Mehgaon 13 4 3.25 170 1.912 6.21 1
Lehsar 3.5 5 0.7 120 0.583 0.41 5
Thresher Services Hired

Village name No. HHs Total HH % of HH using Thresher Ranking
services
Mawai Mall 1 65 1.54 12
Malthar 1 120 0.83 14
Katang Sivni 2 120 1.67 11
Bandariya 3 50 6.00 10
Chapra 4 300 1.33 13
Katangi 5 80 6.25 9
Amdari 8 120 6.67 7
Mehra Sivni 11 120 9.17 5
Majhgao 12 65 18.46 1
Lehsar 18 120 15.00 3
Salepani 18 150 12.00 4
Jamgao 19 300 6.33 8
Banar 23 300 7.67 6
Mehgao 30 170 17.65 2
Tractor Services Hired

Village name No. HHs Total HH % of HH using Tractor Ranking
services
Mawai Rayyat 1 55 1.82 7
Chakdehi Rayyat 1 150 0.67 11
KSRM 81
Melhari 1 84 1.19 9
Lohari 2 120 1.67 8
Mawi Mall 2 65 3.08 4
Lehsar 2 120 1.67 8
Amdari 3 120 2.50 5
Malthar 3 120 2.50 5
Jamgao 5 300 1.67 8
Banar 6 300 2.00 6
Mehra Sivni 7 120 5.83 3
Majhgao 9 65 13.85 1
Mehgao 11 170 6.47 2
Diesel pump set Services Hired

Village name No. HHs Total HH % of HH using Diesel Ranking
Pump set services
Mawai Raiyyat 1 55 1.82 10
Mawai Mall 2 65 3.08 6
Chakdehi Raiyyat 2 150 1.33 11
Melheri 2 84 2.38 8
Majhgao 3 65 4.62 3
Amdari 4 120 3.33 5
Malthar 4 120 3.33 5
Chapra 7 300 2.33 9
Banar 9 300 3.00 7
Jamgao 18 300 6.00 2
Tarvani 21 184 11.41 1
Electric pump set Services Hired

Village name No. HHs Total HH % of HH using Diesel Ranking
Electric services
Lohari 1 120 0.83 4
Banar 1 300 0.33 6
Mehgao 1 170 0.59 5
Katangi 3 150 2.00 3
Saley Pani 13 150 8.67 2
Lehsar 15 120 12.50 1
Spray Pump Services Hired

Village name No. HHs Total HH % of HH using spray pumps Ranking
KSRM 82
Mawai Rayyat 1 55 1.82 4

Melhari 1 84 1.19 6
Aamdari 2 120 1.67 5
Mehgao 4 170 2.35 3
Salepani 6 150 4.00 2
Lehsar 8 120 6.67 1
Village name Ranking of Agri Input Services

Thresher Tracto Diesel Pump Electric Pump Spray Total Final
r set set Pump rank
Mawai 15 7 10 7 4 43 11
Rayyat
Melhari 15 9 8 7 6 45 13
Shukram 15 12 13 7 7 54 16
Bandriya 10 6 4 7 7 34 6
Malthar 14 5 5 7 7 38 9
Mawai Mall 12 4 6 7 7 36 8
Katang Sivni 11 8 12 7 7 45 13
Tervani 15 12 1 7 7 42 10
Katangi 9 12 13 3 7 44 12
Jamgaon 8 8 2 7 7 32 4
Banar 6 6 7 6 7 32 4
Chapra 13 12 9 7 7 48 14
Majhgaon 1 1 3 7 3 15 1
Lehsar 3 8 13 1 1 26 2
Chekdehi 15 11 11 7 7 51 15
Rayyat
Salepani 4 12 13 2 2 33 5
Mehrasivni 5 3 13 7 7 35 7
Amdari 7 5 5 7 5 29 3
Lohari 15 8 13 4 7 47 14
Mehgaon 2 2 13 5 7 29 3
Village name Ranking of Agri Input Product

Urea DAP Pest. Herbi. Total Final Ranking
Mawai Rayyat 18 18 5 10 51 16
Melhari 20 16 1 4 41 11
Shukram 19 16 8 10 53 17
Bandriya 9 10 8 10 37 9
Malthar 15 16 4 10 45 14
Mawai Mall 10 6 8 3 27 4
Katang Sivni 11 7 8 6 32 6
Tervani 17 17 8 7 49 15
KSRM 83
Katangi 5 5 8 10 28 5
Jamgaon 13 8 8 10 39 10
Banar 16 11 8 8 43 12
Chapra 14 12 8 10 44 13
Majhgaon 12 14 6 2 34 7
Lehsar 6 4 4 5 19 2
Chekdehi Rayyat 8 13 8 10 39 8
Salepani 7 7 3 10 27 4
Mehrasivni 4 1 8 10 23 3
Amdari 3 3 8 9 23 3
Lohari 2 9 2 10 23 3
Mehgaon 1 2 8 1 12 1
Table 3: Distributor Analysis for Fertilizers:

Distributor' Location Can Selling Selling Transportation Cost Buyback
s Name Provide price of Price of Facility
the Req. Urea DAP
Quantity
Purohit Mandla YES Rs. Rs. 515/ Will be borne by YES
Traders 270/50 50 kg Distributor in off
kg Bag Bag season or when
Company give the Free
on Road (FOR)
Aggarwal Jabalpur YES Rs. Rs. 518/ Have to borne by NO
Brothers 278/50 50 kg UJAS or Udyogini
kg Bag Bag
Madhu Jabalpur YES Rs. Rs. 515/ Will be borne by NO
Fertilizers 270/50 50 kg Distributor in off
Pvt. Ltd. kg Bag Bag season or when
Company give the Free
On Road (FOR)
Table 4: Distributor Analysis for Pesticides and Herbicides:

KSRM 84

Quantity
Krishi Jagat Dhanpuri YES Up to 7% on MRP Up to 10% on NO
MRP
Brothers MRP
Table 5: Fixed Cost for Agri-inputs and Services

FIXED COST for Agri-Input Products & Services
PARTICULARS AMOUNT (INR)
Ware House Cost
Warehouse cost @ Rs 5000/- per month (Capacity 800 sq feet) 5000
Warehouse cost for 12 months 60000
Warehouse cost for 5 years 300000
Licensing Cost
Licensing Cost for three years (For Fertilizers) 1250/-*2 = 2500/-
Licensing Cost for three years (For Pesticides & Herbicides) 2000/-*2 = 4000/-
Total Cost of Licensing for five years 6500
Investment in Vehicles
Investment in Tractors (One) 500000/-*1= 500000/-
Tractor Trolley (One) 60000/-*1 = 60000/-
Tractor Plough (One) 20000/-*1 = 20000/-
Total 580000
Investment in Farm Equipment Leasing
Diesel Pump set of 5 H.P (5) 20000/-*5 = 100000/-
Electric Pump set 2 H.P (2) 10000/-*2 = 20000/-
Spray Pumps 15 Liters (40) 2000/-*40 = 80000/-
Thresher (2) 45000/-*2 = 90000/-
Weeder(40) 1000/-*40 = 40000/-
Hand Harrow(20) 1000/-*20 = 20000/-
Total 350000
Management cost for Warehouse and Farm Equipment Leasing for 5 years
Manager 10000/-
Two Agri Input Expert (for Research, Development and Training) 16000/-
One Accountant 5000/-
Two Supervisor (2*4000/-) 8000/-
One Drivers (1500*1) 1500/-
One Watchman 1500/-
One Peon 1500/-
KSRM 85
TOTAL COST (for 1 month) 43500/-

Total cost for 12 months 43500/-*12 = 522000/-
Total MANAGEMENT COST for five years 2610000
Essential Maintenance Cost
Maintenance Cost of Tractor (Annually) 12000/- 12000/-
Maintenance Cost of Warehouse (Annually) 6000/-
Maintenance Cost of Farm Equipments (Annually) 12000/-
Total Maintenance Cost for one year 30000/-
Total Maintenance Cost for five years 150000
Total Fixed Cost for five years 3996500
Table 6: Fixed Cost Analysis for five years

Fixed Cost Analysis for five years (for Agriculture Input Products & Services)
Essential
Farm Management
Year Warehouse Licensing Vehicles Maintenance TOTAL
Equipments Cost
Cost
0 0 3250 580000 350000 0 0 933250
1 60000 0 0 0 522000 30000 612000
2 60000 0 0 0 522000 30000 612000
3 60000 3250 0 0 522000 30000 615250
4 60000 0 0 0 522000 30000 612000
5 60000 0 0 0 522000 30000 612000
TOTAL FIXED COST FOR 5 YRS 3996500
Table 7: Variable Cost for Agri-inputs product and services
Variable Cost (For 1st Year)

Particulars Amount (INR)
Transportation Cost
1. Diesel Price*Km (Diesel = Rs 42/ ltr) (Avg 5km/ltr)
Babaliya to Maneri = 60 kms (per trip) 5040
Babaliya to Bakori = 20 kms (per trip) 1680
2. Labour Cost (Rs1.5*570bags*1) 855
3. Tractor (Diesel Cost @ Rs 42/ ltr for 633 hrs) 26586
4. Thresher (Diesel Cost @ Rs 42/ltr/Q for 3040 Q) 127680
TOTAL TRANSPORTATION COST 161841
Insurance for Tractor 6645
Insurance for Warehouse Supplies 452
Electricity Bill (500 per month*12) 6000
Procurement Cost
Urea @ 270/50 Kg bag*400 108000
D.A.P @ 515/50Kg bag*170 87550
Pesticides
KSRM 86
Type 1 @ 201/liter*12Liters 2412

Type 2 @ 211/liter*13liters 2532
Herbicides
Total Procurement Cost for 1st Year 221922
Total Variable cost for 1st Year 396860
Table 8: Variable Cost Analysis for five years
Variable Cost Analysis for Five years
Insurance Insurance
Transp
Premium Premium Electrici Cost of Cost of Cost of Cost of
Year ortation Total
for for Ware ty Bill Urea D.A.P Pesti. Herbi.
cost
Tractor house
0 0 0 0 0 0 0 0 0 0
1 161841 6645 452 6000 108000 87550 4944 21428 396860
2 168315 4652 484 6120 115560 93679 5290 22928 417026
3 175047 3954 517 6242 123649 100236 5660 24533 439839
4 182049 3361 554 6367 132305 107253 6057 26250 464195
5 189331 2857 592 6495 141566 114760 6481 28088 490169
TOTAL 2208090
Table 9: Sales Analysis of CLSC

CLSC to VLSC
DAP DAP @ Rs 526/ 50kg bag 85 Quintals 89420
Pesticides
Herbicides
PI 1ltr @ Rs 1078 11 ltrs 11858
Bayer 1 ltr @ Rs 1048 11 ltrs 11528
Tractor Rs 330 per hour 633 hrs 204712.2
Diesel Pump Set Rs.40 per hour 7025 275380
Electric Pump Set Rs.40 per hour 3200 125440
Thresher Rs.100/quintal 3040 Quintals 297920
Weeder Rs.9/day 90 days 32400
Hand Harrow Rs.18/day 120 days 43200
KSRM 87
Spray Pump Rs 11/ day 702 days 308880

Table 10: Sales Flow* Analysis Year Wise
Sales
Year Sales (in INR)
0 0
1 1518318
2 1624600
3 1738323
4 1860005
5 1990205
Table 11: Fixed Cost Analysis for Agri-inputs Products
FIXED COST for Agri-Input Products

PARTICULARS AMOUNT (INR)
Ware House Cost
Warehouse cost @ Rs 5000/- per month (Capacity 800 sq feet) 5000/-
Warehouse cost for 12 months 60000
Warehouse cost for 5 years 300000
Licensing Cost
Licensing Cost for three years (for Fertilizers) 1250/-*2 = 2500/-
Licensing Cost for three years (for Pesticides & Herbicides) 2000/-*2 = 4000/-
Total Cost of Licensing for five years 6500
Management cost for Warehouse and Farm Equipment Leasing for 5
years
One Manager 10000/-
One Agri Input Expert (for Research, Development and Training) 8000/-
One Supervisor cum Accountant(One for warehouse) 4000/-
One watchmen 1500/-
One peon 1500/-
TOTAL COST (for 1 month) 25000/-
25000/-*12 =
Total cost for 12 months 300000/-
Total MANAGEMENT COST for five years 1500000
Total Maintenance cost for one year (Ware House) 6000
Total Maintenance cost for five years (Ware House) 30000
Total Fixed Cost for five years 1836500
Table 12: Total Fixed Cost Analysis for Five Years

KSRM 88
Fixed Cost Analysis for Five Years

Warehouse Management Maintenance
Year Licensing TOTAL
Rent Cost Cost
0 0 3250 0 3250
1 60000 0 300000 6000 366000
2 60000 0 300000 6000 366000
3 60000 3250 300000 6000 369250
4 60000 0 300000 6000 366000
5 60000 0 300000 6000 366000
TOTAL FIXED COST FOR FIVE YRS 1836500
Table 13: Total Variable Cost for First Year
Variable Cost (For 1st Year)

Amount
Particulars (INR)
Transportation Cost
1. Diesel Price*Km (Diesel = Rs 42/ ltr) (Avg 5km/ltr)
Babaliya to Maneri = 60 kms (per trip) 5040
Babaliya to Bakori = 20 kms (per trip) 1680
2. Labour Cost (Rs1.5*570bags*1) 855
TOTAL TRANSPORTATION COST 7575
Procurement Cost
Urea @ 270/50 Kg bag*400 108000
D.A.P @ 515/50Kg bag*170 87550
Pesticides
Herbicides
Total Cost of Procurement 221922
Electricity Bill (350 per month*12) 4200
Total Variable cost for 1st Year 233697
Table 14: Variable Cost* Analysis Year Wise
Variable Cost Flow Analysis for Five Years

Cost Cost Cost
Year Transportation Electricity of Cost of of of TOTAL
cost Bill Urea D.A.P Pesti. Herbi.
0 0 0 0 0 0 0 0
1 7575 4200 108000 87550 4944 21428 233697
2 7878 4284 115560 93679 5290 22928 249619
KSRM 89
3 8193 4370 123649 100236 5660 24533 266641

4 8521 4457 132305 107253 6057 26250 284842
5 8862 4546 141566 114760 6481 28088 304302
TOTAL Variable Cost for Five Years 1339101
Table 15: Sales* Analysis
Sales Analysis of CLSC (1st Year)

DAP DAP @ Rs 526/ 50kg Bag 85 Quintals 89420
Pesticides
Herbicides
PI 1ltr @ Rs 1078 11 ltrs 11858
Bayer 1 ltr @ Rs 1048 11ltrs 11528
Table 16: Sales Flow* Analysis Year Wise
Sales Flow Analysis of CLSC for Five Years

Year Sales
0 0
1 230386
2 246513
3 263769
4 282233
5 301989
Table 17: Competitor Analysis
Recove
No. of ry Rate
Products/Se Avg. Price
Category Competitor villages on
rvices Volume Range
Covered Credit
sales
Aadim Jati Seva Urea 20 ton 282/ 50 kg 25%
Government 29
Sahkari Samiti DAP 20 ton 528/ 50 kg
KSRM 90
(Maneri) SSP 8-9 tons 170/ 50 kg

Urea 60 ton 282/ 50 kg 35%
Adim Jati Seva DAP 15 ton 528/ 50 kg
Sahkari Samiti SSP 34 2 ton 169/ 50 kg
(Niwas) Loan NA NA
Grain seeds 25 Q NA
Urea 12 Q 280/ 50 kg 70%
Kisan Krishi DAP 25 Q 530/ 50 kg
Kendra Pesticides 50 40-45 Ltrs 650/ 500 ml
(Babliya) Grain seeds 140 Q NA
Pulses seeds 11 Q NA
Urea 100 Q 290/ 50 kg NA
DAP 50 Q 540/ 50 kg
NPK 50 kg 110/ kg
Zinc 50 kg 150/ 5 kg
Herbicides 30 Ltrs 300/ 250 ml
Krishi Udyam
Pesticides 5 30 Ltrs 80/ 250 ml
(Dhanpuri)
Spray
Pumps NA 1050/ unit
Vegetable
seeds 10 kg NA
Grain Seeds 15 Q NA
Private Urea 450 tons 5400/ ton 90%
Retailers DAP 25-30 ton 10400/ ton
SSP 3 ton 3100/ ton
Potash 3 ton 230/ 50 kg
Krishi Jagat Vegetable
30
(Dhanpuri) Seeds 2.13 Q NA
Grain Seeds 12 Q NA
Pulses Seeds 1.5 Q NA
Herbicides 350 Ltrs 6450/ 5 ltrs
Pesticides 50 Ltrs 230/ ltr
Pesticides 200 Ltrs 1300/ ltr 60%
Patel Krishi
Herbicides 84 250 Ltrs 350/ 250 ml
Kendra (Barela)
Vegetable 150 kg NA
KSRM 91
Seeds
Pump Sets NA NA
Spray pumps NA NA
Urea 50Q 282/ 50 kg 50%
Sharad Kirana DAP 10Q 500/ 50 kg
6
Store (Niwas) Vegetable Don't
Seeds Know NA
Shivani Kirana Urea 180 Q 282/ 50 kg NA
20
Store (Babaliya) DAP 5Q 527/50 kg
Table 18: Distributor Analysis for Fertilizers

Distributor' Location Can Selling Selling Transportation Cost Buyb
s Name Provide price of Price of ack
the Req. Urea DAP Facilit
Quantity y
Purohit Mandla YES Rs. Rs. 515/ 50 Will be borne by Distributor in YES
Traders 270/50 kg Bag off season or when Company
kg Bag give the Free on Road (FOR)
Aggarwal Jabalpur YES Rs. Rs. 518/ 50 Have to borne by UJAS or NO
Brothers 278/50 kg Bag Udyogini
kg Bag
Madhu Jabalpur YES Rs. Rs. 515/ 50 Will be borne by Distributor in NO
Fertilizers 270/50 kg Bag off season or when Company
Pvt. Ltd. kg Bag give the Free On Road (FOR)
Table 19: Distributor Analysis for Pesticides and Herbicides

Quantity
Krishi Dhanpur YES Up to 7% on MRP Up to 10% on NO
Jagat i MRP
KSRM 92

Brothers MRP

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KSRM 1

Study of Existing Supply Chain of UJAS and the Feasibility Study of

Udyogini, Jabalpur, M.P.

“A REPORT SUBMITTED IN THE PARTIAL FULFILLMENT OF

School of Rural Management

SCHOOL OF RURAL MANAGEMENT, KIIT UNIVERSITY

The MTS Report of

Reza Mohammad Khan

Sumeet Kumar Pandey

Candidates for the degree of MBA Rural Management

Are hereby APPROVED

Host Organization: Udyogini, Jabalpur, Madhya Pradesh

Project Location: 30 Villages of Mandla and Jabalpur Districts of Madhya Pradesh

Project Period: 6th July to 6th September 2010

Objectives of the Project:

 To understand the supply chain of retail products and procured commodities

Findings and Analysis:

For Supply Chain of UJAS:

 Proper implementation of 4Ps should be followed in the operational areas of VLSCs.

For feasibility of distributing agriculture inputs and services:

The organization should also be engaged in promotion of some livelihood development

towards making this report possible.

could not be possible.

4.7.3. Products and Services ................................................................................................. 41

Table Description Page

Figure No. Description Page

1.1. Organization Overview:

1.2. Project Overview:

1.3. Rationale of the study:

 Fragmented and small land holdings.

1.4. Objective of the study:

1.5. Scope of the Study:

agriculture demand, market analysis, competitor analysis and distributor interviews at

1.6. Designated Project Area:

1.7. Limitations of Study:

Fig 1: Phases of the Project

2.1. Sample Design and Sampling Method:

2.2. Survey Design:

2.3. Data Collection

problem identification data was collected by structured interviews of the VLSCs

2.4. Data Analysis

4. Analysis and Findings

 Enterprise motivation and management awareness for grassroots women

 Udyam Jagran Sansthan (UJAS)

 Working Entrepreneurs Group (WEGs)

Fig 2: Enterprise Model of UJAS

 Cluster Level Service Centres (CLSCs)

 Village Level Service Centres (VLSCs)

Fig 3: Working Model of VLSCs

 Problems with Retail Business:

A feasibility study is essentially a process for determining the viability of a proposed

A typical feasibility study is done to:

4.3. Demand analysis of agriculture inputs and related services:

Major findings of demand analysis are as follows:

Fig 4:Map of Mandla Table 1: Basic Information (MP)

 Total geographical area: 965,559 hectares.

 Cropping intensity: 149%

 Percent of net sown area irrigated: 7%

 Main occupation for 87% of all workers in the district is agriculture.

Fig 5: Land Use Classification

Table 2: Land Use and Agriculture

Table 3: Per Capita Agriculture Production