Supply Chain - India
Allogistx International Inc.2130 Huntington Drive suit 205South Pasadena, CA 91030 [email protected]: 323.254.9550Fax: 323.315.9311
Allogistx International Inc. India124-A, Naman Plaza1st Floor, Behind Shoppers Stop,Kandivali (west)Mumbai, India 400 [email protected]
Agenda
-Evolving Indian Economy - Changing Supply Chain Dynamics - New Growth Drivers - Supply Chain Challenge - Emerging Solutions & New Platforms
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India is Growing! Source: Economist
• India will be the third largest economy by 2040 3
Urban Population Increasing
• Urban population projected to cross 500 million by 2025 - Cities are expanding
Agro Enterprise Without Borders, Singapore, 2009 4
Food Consumption Increasing
• Food demand increasing - Quality preference increasing 5
Retail Sales Growing
• Retail sales cross US$ 900 billion by 2010 Agro Enterprise Without Borders, Singapore, 2009 6
Growth Drivers
Demographic advantage: Young population Credit availability Increasing discretionary incomes Increasing retail space
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Challenges Inefficient Supply ChainInfrastructureLow Technology PenetrationFood SafetyUnorganized sectorBureaucracy
Sanjeev Asthana Agro Enterprise Without Borders, Singapore, 2009 8
Disjointed Food Supply Chain Village
Commission Agent
Sub Farmer District Commission
AgentWholesaler Retailer Consumer
• Low yield / non-standard qualityFarmer • No control on quantity / quality of
raw material• Price de-linked from market Processor
• Unscientific and unhygienic handlingVillage • Lack of infrastructure leading to loss of quality
Commission Distributor • Poor market access Agent
• Loss in trade passed onto farmer
• Lack of infrastructure leading Mandi / Local • No infrastructure for handling/grading Retailer agents •Price quality correlation not assured
• High prices Transportation • Unscientific method leading to loss of quality /damages Consumer • Limited choice
• Inadequate infrastructure Wholesale •Rampant wastage Non value adding players •Opportunistic profiteering
Sanjeev Asthana Agro Enterprise Without Borders, Singapore, 2009 9
Poor Supply chain Infrastructure • Poor infrastructure facilities for
StorageTransportationProcessingPackagingDistribution
• About 3,500 cold storages/warehouses Only 13m tons of storage capacity for production or 140 mn
tons of Fruits/Vegetables
Sanjeev Asthana Agro Enterprise Without Borders, Singapore, 2009 10
Supply Chain - High Costs • Inefficiencies in Distribution
• Lack of cold chain and warehouse structure• Logistics costs in India are among the highest• Fragmented retail structure
• Supply Led Growth • World: 72%
• India: < 1%
• More than 5 million retail outlets selling food products • Limited focus on food safety and hygiene • Limited choice to the consumer • Low investment in quality control, product innovation, private
labeling and market intelligence
Agro Enterprise Without Borders, Singapore, 2009 11
Underdeveloped Processing Industry
• Fruits and vegetables Country % Processed Malaysia 83%
2-3% of produce is processed8%-37% lost in storage and transportation
South Africa 80% Phillipines 78%
- Inadequate storage and cold chain Thailand 72%
Brazil 70% USA 65% - Inadequate processing and marketing
infrastructure India 2-3 %
• Grains 3% is lost in storage
Opportunity Significant growth potential & a challenge
Agro Enterprise Without Borders, Singapore, 2009 13
Way Forward Private-Public-People Partnership can be growth engines for Supply Chain
*Have someone who is Local as well as Global help you realize these opportunities…
Agro Enterprise Without Borders, Singapore, 2009 18
Thank You!
Allogistx International Inc.2130 Huntington Drive suit
205South Pasadena, CA 91030 [email protected]: 323.254.9550Fax: 323.315.9311
Allogistx International Inc. India
124-A, Naman Plaza1st Floor, Behind Shoppers Stop,Kandivali (west)Mumbai, India 400 [email protected]
Thank You!
