“TATA’s Khet Se, Which is a 50:50 JV between Tata Chemicals and Total Produce, Ireland is expanding, Reports suggest that they are opening up another distribution center in Mumbai “
Previous posts related to “Rural Retailing” got me thinking! We all have read and acknowledged the fortune at bottom of the pyramid! So whenever a biggie (Read: Reliance) enters the market at the bottom! The numbers would just juggle me up! What is “Rural Retailing” after all? Is it organizing the retail mechanism in the rural parts of India? or is it about bringing rural India close to urban India? Where is the actual “Fortune”?
So I ended up “Googling” a bit about both the scenarios, while rajeev posted about “Reliance” entering the rural market, I stumbled across the news of TCL’s “Khet Se” setting up a DC in Mumbai. Both the players have the word “Rural” intact! One is going to the rural market, setting up a store there, and will provide agricultural inputs, Groceries etc. On the other hand “Khet Se” is playing a role reversal by bringing rural products to urban India, They are gambling upon revamping the way farm fresh products are warehoused and distributed.
“Khet Se” has its focus on registered B2B consumers, Which range from local fruit/vegetable vendors to local retailers, Who can directly buy farm fresh products from khet Se’s DC. In terms of value addition Khet Se is providing the technical know how to the farmers, to help increase the output and overall quality of the end product, While they are working on a efficient supply chain as well.
Now we just have to wait and watch, Who gets to the fortune first! Which model is more beneficial for the “Rural India”? My bet is with Khet Se! How about yours? 
- Sarthak
Sphere: Related Content
Email
Print
Loading ...
August 28th, 2008 at 6:20 pm
Hey Sarthak is it a concept of “farm to fork” becoz if it is so Relience can win the ground on the basis they already have Relience fresh operational while Tata don’t have any such presence. Moreover i think the same concept is already rolled out by Godrej where they have Godrej agrovet for rural and Nature’s basket for urban areas providing fresh farm to fork products using rural-urban connection.
August 28th, 2008 at 11:44 pm
hey sarthak,
ur comparison is really enlightening..
“One is going to the rural market, setting up a store there, and will provide agricultural inputs, Groceries etc. On the other hand “Khet Se” is playing a role reversal by bringing rural products to urban India”
My money also on Khet Se because the format like that of Reliance might not be accepted by masses.. moreover they will face tough competition from DSCL & Future Group. But Khet Se is a different kind of model and will be highly accepted by farm product vendors. It is creating value at both ends of its model.
August 29th, 2008 at 1:23 am
Hope you are aware…Bharti too is into it and been there since 2004.
http://www.fieldfresh.in/
The Punjab government allotted 300 acres on a long lease to the company last year in Laddowala near Ludhiana. Bharti Enterprises, in collaboration with UK-based Rothschild, is exporting fresh vegetables under the brand Field Fresh (a 50:50 joint venture) to the UK, Middle East and ASEAN countries.
The company is developing the largest R&D centre for agriculture in Asia. It is constructing a glass house, green house and a poly house on an area of 42 acre. Bharti is also making a pack house, covering 20 million square feet.
FieldFresh Foods (P) Ltd was incorporated in the Year 2004, with a vision to Link Indian Fields to the World, by making India a global food basket.
The company is engaged in providing premium quality fresh produce to the markets worldwide and promotes world class standards for agricultural practices, progressive farming techniques & identification and adoption of appropriate technologies.
The Research & Development work, being undertaken at the model farms, is benefiting a large number of partner & non-partner farmers
August 29th, 2008 at 12:41 pm
@ Prateek: No its not a concept of “Farm to Fork”, Its a B2B model focussing on local retailers, by providing them with quality products straight out of farms with a good supply chain and storing model. So the catch is here, They are not turning retailers themselves, instead they are adding value to the chain.
@ Rajeev: Yes! Thats the whole point, Rural Retail is not just about selling products to rural markets, but its about bringing there products to the new world markets to provide them economy properity as well!
@ Raja Sir: I really didnt have a clue about Bharti being in the same business, or else would have included them as well, So now my bet moves on to both “Khet Se” providing channels to local retailers, and to “Bharti” providing channels to international retailers.
August 30th, 2008 at 2:01 am
hi…guess we need ,more of ‘khet se’s and bharti’s…only their initiatives can be to an extent be sided with CSR…let the rural people first earn enough to be capable to buy products from the ‘reliance’s etc.
September 23rd, 2008 at 3:58 pm
I though i might as well contribute in the post, since i have worked with Khet Se agri produce in the past. This company has a a little bit of everything into it, be it CSR or Business.
Launched earlier in Ludhiana, they have their distribution centre in Malerkotla. The second one is coming up in Mumbai and the third in Narayan Gaon near Pune. This model is greatly challenged by the fact that there is direct competition to our local mandi where sellers and buyers get long standing credit. The mandi people have the direct authority to fluctuate prices through out the day and hence many farmers who try to sell their crop loose out. Same goes for the reatiler who have to queue up early to get the best produce. Khet Se’s model primarily is to buy from the farmer at designated rates according to the produce quality eliminating any middle men. Further its sold to only retailers and institution at competitive wholesale prices. The venture is to greatly benefit when the whole chain of DC’s are set up. The chain will ensure the best produce from across the country to be available at all stores. Since region wise the produce quality differs and so does the quantity which affect prices, a uniformity can be maintained. The next bigger challenge in front of the company is to face the local heat. Each market they go into will be faced with various acceptance levels, a shift of trust from the mandis to Khet Se itself. Its still a long way to go, but surely the step has been taken.
Sudip