The Agro & Food Processing industry of the country has been a leading contributor to the Indian economy for decades. Businesses in this industry must frequently play victim to vagaries of monsoons, market demand, and supply constraints. These considerations make the Agro & Food Processing industry a fast- paced and challenging industry in which to excel as a business.
ABS Agro & Food Processing industry solutions have been created for various sub- industry verticals;
- Dairy
- Seeds
- Marine Foods/ Exports
- Plantations
- Food Processing
The Dairy Industry combines the complexities associated with the food processing industry, the FMCG/ distribution industries on the marketing and sales end of operations, as well as the unique challenges posed by the agro- industry on the procurement cycle.
Given that the raw material and end product is perishable the operations and cash turnover cycles in the dairy industry are a daily affair. “Collection centre” are set up in villages to source milk, which must then be transported to “chilling centre” and processed to create a stock of milk powder. Milk and milk products are then produced and distributed, all within 24 hours. Quality tracking also plays an imperative role throughout the operations cycle.
Daily forecasting of demand becomes an essential factor in preventing wastage and losses. Seasonal variations also play a huge role in the dairy industry as production of milk speeds up during the winter while demand for milk and milk products fall, and vice- versa. The process of creating a stock of milk power during surplus supply months and liquidating it when demand dictates, necessitates the need for effective stock and inventory management.
For businesses that sustain only on the sale of milk, entering into the production of value added products (milk products), whose demand is more or less stable through the year and that sell with higher margins can potentially insulate them from seasonal fluctuations of market demand.
Seeds/ Marine Foods and Plantations face similar challenges where the sales cycle could be through trading of commodities in auctions or through FMCG distributors. Production however begins a year or more prior to sales.
The monsoon season plays an imminent role in making these industries profitable. For seeds/ plantations planting seeds, needs to be aligned with the on-set of the South- West monsoon, prior to which GM seeds need be developed to meet the specific cultivation requirements of various states/ regions in which they must be planted. Contract farmers are often hired to access large plots of land for cultivation.
In the case of the marine industry forecasting market demand and supply needs to be effective.
Processing the cultivated crop/ marine foods into value- added products and marketing, for those businesses that go through distributors pose their own challenges.
Effective forecasting and risk management (from seasonal vagaries, pests and diseases) are all important challenges faced by businesses in these industries.
ABS solutions are aligned with the specific needs of the dairy industry, helping businesses like yours achieve the efficient coordination required to run in the industry.
With over 10 years experience and domain expertise in the Agro & Food Processing industry we have identified the following key business drivers of your industry that often become performance pain points.
