Wednesday, March 5, 2008

Hariyali rural retail, now a Harvard case study

One of the country’s agri-business initiatives, Hariyali Kisaan Bazaar — the rural retail venture of DCM Shriram Consolidated Ltd — has become a case study for students at the Harvard Business School.
Late last year a team from Harvard came to India to extensively study the model and turn it into a case study, and this month it was also presented at their international agri-business seminar at the school.
Earlier, Harvard had studied the e-choupal model of ITC.
“Prof David Bell (of Harvard) contacted us after hearing about the initiative from a participant during a World Bank meeting. He was excited and wanted to study how it was making a difference in the lives of farmers in the country, besides being an example of inclusive growth that the country is advocating,” said Mr Rajesh Gupta, President and Business Head of DSCL’s Hariyali venture.Catalyst for social change
The study, in fact, has highlighted the model as a catalyst of social change and traces its beginnings to DCM’s deep-seated interests in agri-business and its involvement with the sugar business as early as the 1930s and later its entry into the fertiliser sector in 1966.
The genesis of the retail venture goes back to 1997 when DSCL initiated an agricultural extension programme, Shriram Krishi Vikas Guides, in northern India where the guides were trained agronomists posted in rural areas to address the needs of farmers and solve agri-based problems such as seed quality, irrigation techniques, fertiliser usage and crop yields.
It was at this point that the company found farmers asking for a host of quality agri-products at reasonable prices.
The study quotes Chairman and Managing Director Mr Ajay Shriram recounting how the company found in this a business initiative “which could leverage the agri-value chain, have a transformational impact and improve the quality of life in rural India.”
Today Hariyali has 125 rural centres spread over the north, west and south of the country. Its one-stop shops provide farmers with a range of agri and non-agri products, latest farm technology, farm fuels, and output buyback of farmers’ produce. The centres are also IT-enabled and provide farmers critical data relevant to them, inputs and access to weather forecasts, market prices and other technical knowledge.
Going forward, the company wants to experiment retail on the output and input side. Mr Rajesh Gupta is exploring Hariyali’s potential as a bulk buyer, which would serve as a conduit to rural India for companies who want to sell their products and services there. Motorola is already using the Hariyali route for its handsets. On the output side Hariyali is mulling being an “instrumental link” in the retail value chain, to supply large urban retailers with fresh fruits, vegetables and grains procured directly from the farming community.
The major challenge faced by Hariyali in meeting the expectations of the brand, and cited in the Harvard study, is the logistics of having employees in so many different locations and providing for the economic nuances, attitudes and practices of different regions of the country.

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