Development of procurement and distribution model for farm fresh fruits and vegetables

Abstract

India is the second largest producer of fruits and vegetables (F&V) in the world, contributing to about 10% of the total world production.1 ?? Vegetables: 82 M tonnes (10.9% of global production) ?? Fruits: 47 M tonnes (8.4% of global production) The food and grocery business offers a beguiling prospect, with such a huge volume and potential. The India Retail report 2007, put together by leading Indian and Foreign consultancies, estimates that the retail pie was worth Rs.1200000 Crores in 2006, in which food and groceries constitute a whopping 63 per cent. But the share of organized retail in this sector was negligible. According to CRISIL research, food and grocery (F&G) accounts for a significant 74 percent of the retail sales which it places at Rs.12.8 trillion. However, F&G accounts for only 18% of the total organized retail market. A more disconcerting fact is that the penetration of the organized retail market in F&G vertical is a mere 1 percent. This clearly points to a huge opportunity for companies planning to enter organized retail in the food business. The following figure shows the share of India’s production in the world’s production of some select fruits and vegetables2: