Low Prices and High Intermediary Costs (Market Efficiency)

Problem Statement

The long and inefficient supply chain, dominated by multiple intermediaries, results in a significant price gap between the consumer's payment and the farmer's realisation, leading to low farmer incomes.

Innovation Opportunities

• Digital Marketplaces for Direct FPO-to-B2B/B2C Sales: Creation of platforms that facilitate direct transactions between FPOs/large farmers and bulk buyers (retail chains, processors, exporters) or end consumers, cutting out unnecessary layers.
• Auction-based and Dynamic Pricing Platforms: Technology solutions for transparent, live e-auctions of aggregated produce at local centres to ensure competitive, real-time pricing.

Use Case Example

An FPO lists 5 tons of potatoes on a B2B digital platform. Multiple institutional buyers bid on the quantity, resulting in the FPO securing a price 15% higher than the local mandi rate.