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 I.T.C
E-CH0UPAL

INDIRA SCHOOL OF CAREER

DEVELOPMENT
 I.T.C

j Indian tobacco company.

j Chairman: Y.C. Deveshwar
j Presence in tobacco, hotels, paper boards,
foods, fashion retailing and commodity
export.
j Annual sale of $ 2 billion.
 International Business Division

j atarted in 1990.
j Division of ITC engaged in exports of range
of agricultural commodities.
j Contributes over 60% of foreign exchange
earning.
„

 „

j Choupal is a hindi word which means a
village meeting place, and ³E´ here stands
for electronic so it is a village meeting place
on a electronic platform.
j It is a virtual market place where vendors
and customers come together to do
transactions.
 „

j It is a virtual market place where farmers
can transact directly with a processor and
can realize better price for their products.
j ITC used a aYMBIOTIC-MICRONODAL
model. As both the parties were making
profits at different levels.
 The E-Choupal Services
j Relevant & Real-time Information
j Commodity prices, Local Weather, News
j Customized Knowledge
j —arm Management, Risk Management
j Supply Chain for Farm Inputs
j acreened for Quality, Demand Aggregation for Competitive
Prices & Efficient Logistics
j Direct Marketing Channel
j Lower Transaction Costs, Better Value through Traceability
j Products access @ door step @ reasonable prices
Conventional Business Model
 Disadvantages of the Conventional
Business Model

j Too many intermediaries.

j Information asymmetry caused by
intermediaries as they block flow of
information to farmers.
E-Choupal Model
 Advantages

j No hierarchy of brokers.
j Internet is used as a low cost medium of
communication providing latest information.
j Intermediaries are still used for physical
delivery of produce maintaining low cost .
 Advantages

j E-choupals are set up by ITC with solar

power back up and VaAT connectivity. The
equipment cost for the E-choupal is borne
by ITC.
j Allow farmers to compare global and local
market price (Mandi)
 Advantages
j Actual procurement is done at factories and
warehouse hubs. The initial logging is done
through the e-choupal, which provides price
information and therefore price certainty.
j To farmers they give access to operational
information developed by ITC experts,
pertaining to cropping, seeds, fertilizers and
so on.
Transaction Costs in Mandi Chain
aoybeans Example
Rs per MT

Trolley —reight to Mandi = 120

Labour = 50
Farmer Incurs Kacchha Adat = 150
Handling Loss = 50 370

Processor Commission to Agent = 100

Incurs Cost of Gunny Bags (net) = 75
—reight to —actory = 120
Handling at Mandi = 40
335

Total Chain 705

Transaction Costs in Choupal Chain

Trolley —reight to ITC Hub = 120

Labour = 50
Kacchha Adat = 150
Handling Loss = 50

50
Commission to aanchalak = 100
Cost of Gunny Bags (net) = 75
—reight to —actory = 120
atorage & Handling at Hub = 40

Cash Disbursement Costs = 50

The E-Choupal Infrastructure

j ITC Kiosk with Internet Access

j In the house of one trained farmer,
 
j Within walking distance of target farmers.
j Warehousing Hub
j Managed by the erstwhile middleman,
 
j Within tractorable distance of target farmers.
 The Privileged Assets of E-Choupal
[ ITC Infrastructure:
a. Computer
b. Internet
c. VaAT
d. Power Backup : aolar Cells and UPa
- Physical Reach:
a. Choupals within walking distance
b. Multipurpose WH hubs within tractor able distance

3 Key Intermediaries:
a. aanchalak (1 per cluster of 5-6 villages)
b. aanyojak (1 per group of 30-40 choupals)
 X
  

   

 

Power Connectivity

Training
- Hubs Upgraded to Malls
—ACILITIES AT CHAUPAL SAGAR
j A WIDE RANGE O— PRODUCTa —OR ALL aEGMENTa

j TRAINING —ACILITIEa —OR —ARMING COMMUNITY ON

aCIENTI—IC —ARMING PRACTICEa

j GODOWNa —OR aTORAGE O— —ARM PRODUCE

j IN—ORMATION CENTER —OR ONLINE WEATHER

IN—ORMATION

j CONTINOUa aERVICEa —ROM 6AM- 9PM

CSR Initiatives through e Choupal :
³
X´
j Sunerha Kal (CSR) Initiatives focus on
j Improve —armer Livelihoods,

j Long Term Community Impact programmers,

j Livestock Management programmers,

j Water Management ,

j aelf Help Groups focusing on women.

j Leveraging capability of
j ITC µs management skills,

j ³e-choupal ³reach , human and physical Infrastructure,

j The knowledge & experience of NGO¶s .

Causeway cum Stop Dam , Nalkui
Earthern Dam ± Morewani ,MP
Scale Today

Kiosks: 6,-00
Villages: 40,000
Farmers: 3 5 million Aheat

Soybean

Soybean
& Aheat

Coffee

Aqua
 —uture Plans
e-Choupal Now Next 5 Years

States covered [0 [5

Villages covered 40,000 [00,000

NO of e-Choupals 6,500 -0,000

Farmers e-empowered 4 million [0 million

For more : visit www itcportal com ITC e-Choupal

Presented by
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December 21, 2010

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