With the advent of new technologies, there is a huge shift of energy towards new equipment use in agriculture. Many educated people have stepped in to spread awareness on this subject. They teach farmers about the various ways in which they can earn much more than just a meagre amount for the hard work they put around the year.
Bala Reddy, an IIM-A graduate, took a step forward leaving behind his lucrative job as a software engineer. Bala was born to a farmer in Telangana. He grew up watching his father toiling round the year to generate various crops but earning only a little. Since his childhood, Bala was involved in agricultural practices along with his father. However, his father encouraged him to study and be something different, if not grand.
Bala’s family was not very stable financially. But he was a very bright student and cleared the engineering entrance exams. He took admission in NIT, Warangal, and bagged scholarship to complete his education. He was focussed and did not miss out on this opportunity to change his fate.
Leaving all the hardship behind, Bala got a job as a software engineer. It was good money but the job did not excite him much. His heart was elsewhere. He quit his job to do something meaningful in the agriculture sector. Mulling about his future, he thought the best would be to have some good training. Bala got into IIM, Ahmedabad,to pursue an MBA degree in agro business management. Being the bright student that he was, Bala received a scholarship for his post graduation as well, and managed the remnant amount by taking an education loan.
His vision was to go in agricultural and do something extraordinary so that he could help out the farmers. In a conversation with KenFolios he says, “All the bright students end up taking glamorous courses but no one takes agriculture as a profession. If bright minds choose agriculture, the growth in this sector will happen automatically.”
After his MBA, Bala worked in a start-up company for one year in 2007. This was too tedious for him so he ventured out to the maternal side business of infrastructure for seven to eight years. But as said, his heart was already set in agriculture. he finally started his own company Our Food Pvt. Limited in June 2016.
“In Indian agricultural food supply chain, whatever production improvement as far as the agro-produce in concerned is done. We are getting lesser than what is required and the production is low. This is causing the farmers to receive very low price. So what is done through green revolution and agricultural universities is that the scientists are producing hybrids that are compensating with the production that is being done. That is why the farmers are not getting proper price,” he says.
Whatever help the government or other companies are doing is only till production phase and not beyond that. They are not working to increase the income of the farmer. For instance, last year tomato farmers got only forty paisa for one kilogram. This is because of overproduction. In a scenario, if the farmer goes beyond the production phase and makes ketchup or puree of these tomatoes he will get something more.
This is from where the idea of Our Food came in picture. In the research Bala found out there were no technologies available to the farmers. The plan came out to ensure technology and marketing schemes to these farmers. This could remove the middlemen and allow the farmers to reach their bulk buyers or customers on their own thus earning a greater percentage of the cost involved.
In order to keep the produce, Our Food has bought one acre of land in a particular geographical location near Hyderabad and made it their warehouse. There are low cost machinery available in the warehouse for the farmers by which they can convert the produce to low cost end product thus saving a portion of their expenditure. All the mills are demonstrated in the warehouse and these low cost machinery can be bought by the farmers themselves.
The mills are funded partly by the farmer and partly by Our Food and a portion by local banks. So whatever is grown and processed by the farmer can be sold to the bulk buyer directly from the warehouse. Thus the middlemen are removed from picture.
This model of warehouse is functioning since January 2017 and brings clients like Big Basket, Ratandeep, Hypercity, etc.
“The vision of Our Food is to bring farmers closer to processing and customers, removing as many middlemen from the scene as possible. However, when we initially recited this structure to the farmers they laughed at it, as many companies had tried this model but failed. I also plan to open at least 20 centres per state and become parallel system for the food supply chain system,” Bala says.
Getting the motivation from his father, Bala found out that agriculture was not as difficult as it seems to some people. Introduction of technology and spreading awareness amongst the end users came after educating the farmers adeptly. In order to educate farmers Bala and his team experimented with different models from June 2016 to December 2016.
They found out that it was very difficult for the farmers to reach the bulk buyers or consumers on their own. They had no transportation facilities and the model to collect farmers at once place and enrich them about quality products was again not possible given the farmers had already seen all this. Thus Bala decided to start the warehouse where they added value to the product and sold them at a higher price than before with the help of low cost machinery.
Thus he started one center in February 2017 with this model near Hyderabad. The second center is under construction and located at somewhat 80 kilometres from Hyderabad. Our Food has a employee base of 15. As was expected, Our Food’s revenue for financial year 2017-2018 is crossing Rs 40,000,000. Bala is also starting three more centres by June 2018.
Our Food is also providing franchise for the rural entrepreneurs or anyone who would like to open their own centre for processed goods. In coming four to five years Bala is looking forward to expand in four different states and cover as many basket businesses as possible.
“Try to connect directly to the farmers when you are bulk buying the goods. This will not only eliminate the middlemen but will also help the farmers grow and bring better produce to which value can be added”, he concludes.