In 2008-09, Murugappa Group undertook a tactical initiative to take retailing first to rural India, where it would sell goods that are needed by farmers. In the second half of the year, through its company, Coromandel Fertilisers, the Group opened 430 “rural retail outlets” in Andhra Pradesh.
In these centres, the Group sells agri inputs such as fertilisers, pesticides and seeds. About 70 of them also sell household appliances and garments. It is only a few months since most of these outlets have come into being but company officials say that the full business value of them will be realised in the current year.
According to V Ravichandran, managing director, Coromandel Fertilisers, the centres have been a hit with the farmers. Demand for agri inputs was there, but demand for goods such as rice cookers, fans, coolers and garments was also high, he said.
Backed by this experience, the company intends to make a three-pronged expansion in this direction. First, it proposes to open about 300 more outlets, of which about 70 may come up this year. Second, it wants to sell more items of agri inputs; plans are to introduce veterinary medicines and animal food supplements. Third, the company will introduce more non-agri products in more outlets.
A number of these outlets also have division that do soil testing and agri consulting for farmers, gratis. These retail centres today touch the lives of 200,000 farmers.
The strategy of “direct contact” with farmers will strengthen the group’s relationship with them. It will also aid sales of other products such as organic and water soluble fertilisers.
Addressing a press conference, the vice-chairman and director-Strategy, Murugappa group, A Vellayan, said such products will help the farmers and the company. It will help farmers by saving water and electricity costs and the company by helping reduce dependence on subsidy-based fertilisers.
Source: Business Line
