03 Jul The Crucial Last-Mile-Connect at Village Level
There is an urgent need to establish a “last mile connect” at the village level for extension service delivery and many startups offer technology as a solution to most of the farmers problems. But unfortunately, there is a gap which most of them seem to miss.
The fact is our farmer community is not yet geared to adopt technology solutions independently due to several reasons of which, access and tech awareness are prime practical issues. As a result I often get to hear from startups, that downloads are limited as it works only through one to one referrals and after the novelty factor goes, the active user database becomes very poor.
“technology standalone options are often redundant.”
So technology standalone options are often redundant. Unless of course, startups address this gap by making their product relevant, viable and quickly scalable for farmers to access, as the last-mile-platform is almost indispensable for cultivators to become agri-entrepreneurs.
However, the grim reality is that in most places even a basic last-mile-platform connectivity is hard to find in order to help startups to augment and make it scalable. Since scale drives cost and cost drives the price of service, this is the bottle neck that prevents most farmers from being able to access the facilities. Therefore, startups either end up as a high cost solution which is available to only a limited section of big farmers or it becomes unviable in the long term, as unit economics does not make much business sense.
For value chain organizations, they invest resources to establish the last mile connect with farmers which increases the price by 20-30%; This additional cost and practical business sense always forces them to reach out to big and medium farmers as “touch points” for their procurement needs. This results in small & marginal farmers though more in number, to be excluded from such profitable business ventures. These big market operators shy away from small and marginal farmers because the investment to establish the last-mile-connectivity at scale to cover the large number of small and marginal farm populace is not viable in terms of unit economics. So in essence, the crux rests on the unit economics which works out to be disadvantageous for the small farmers to get the benefit from the value chain organizations.
When it comes to input suppliers, their focus is on selling the product hence the extension and advisory become secondary for their last mile staff. Since their scope to deliver the advisory service as support to farmers is limited, they tend to reach out to big and medium farmers to deliver their extension advisory rather than reaching out to small & marginal farmers as the numbers of small & marginal farmers ranges between 85% to 92% across any state. This also highlights how small & marginal farmers are left out from access to support system by input supply companies.
The input dealers who are the informal advisory providers for farmers on ground, exploit farmers with unnecessary/ poor quality inputs as farmers’ knowledge and awareness gap is high because of failed/ poor extension delivery system at the village level. Focus on sales volume and profitability drives the input dealers to do that exploitation.
In all of the above cases, how the absence of last mile connect playing a huge role in making the small & marginal farmers not able to become knowledgeable, better informed and reached out by market forces.
To address the above gaps, there is an urgent need to establish a last-mile-connect which is low-cost, can work at scale and also self-sustainable. One possible solution is community owned and community driven farmers’ platform. The “farmers-farmer” extension model fits the above requirements however it was very not successful in the past due to certain design and implementation challenges;
Dr. Reddy’s Foundation, considering the above reality of status of small & marginal farmers and the dire need for a community owned platform to address those challenges, piloted the “farmers-farmer” extension model (lead farmers platform) with certain design changes to address the last mile delivery in 550 villages for last two years and the results are quite satisfactory.
The community platform of lead farmers is able to help the start-ups to reach out farmers at scale by addressing the awareness and knowledge gap with support of DRF field team. They act as the key point of contact to mobilise and group the farmers at village level so that these organisations be it start-ups, supply chain organisations or input suppliers are able to reach to the small & marginal farmers at scale in these villages. We also experienced that the private players showing great interest to reach out to new target segment which otherwise is difficult to catch in their conventional business approach.
As a next step of solving the problem of last mile connect at village level, DRF is trying to nurture the community platform of lead farmers in all 1260 villages of Samasthipur district, Bihar in coming three years period. We believe that if the district model meets the success indicators set in three year period, it can be showcased as a model which can be a last mile delivery solution to private players/ government/ NGOs to reach out to small & marginal farmers at scale.