Bangalore firm plans retail chain for farm machinery


"We plan to set up about 300 agri-marts through the franchise route as a one-stop solution for farmers, especially small and marginal farmers," Ratnagiri Impex chairman and managing director S.A. Vasudev Murthy told IANS.
The decade-old Bangalore-based Impex has tied up with global agri-tech product manufacturers such as Oleo-Mac SPA, Cifarelli SPA and GF SRL of Italy, Briggs and Stratton of the US and Alrite of South Africa to import machinery for tilling, sowing and harvesting despite 39 percent customs duty.
"Most conventional agriculture implements are locally made and sold through the unorganised sector. Farmers are unable to enhance production, improve quality and minimise wastage. Lack of adequate and institutional funding also discourages farmers from graduating to mechanised farming," Murthy said.
Going forward, he said, the company planned to set up manufacturing plants with its international partners to avoid import tariff and shipping and landing costs.
"We hope to build sufficient volumes over the next three years to go for a joint venture with Olea-Mac or Cifarelli to manufacture import-substitute farm machinery."
The Rs.40-crore (Rs.400-million) company is also in talks with potential investors to open about 70 agri-marts in the southern states in the first year of operations and roll out the remaining 230 retail outlets across the country over the next three years.
"We will invest Rs.14 crore upfront in the first 70 agri-marts, with 20 each in Karnataka and Andhra Pradesh, 18 in Tamil Nadu and 12 in Kerala. Our investment in each agri-mart, costing about Rs.20 lakh, will be 75 percent and the franchise will chip in the remaining," Murthy said.
To facilitate the transition from traditional to mechanised farming, the one-stop rural mart will not only display and demonstrate a range of implements but  also train farmers.
"Our agri-marts in small towns and villages will mean farmers don't have to travel to towns for equipment, after-sales service and spare parts, as we will provide all these under one roof in their neighbourhood," he added.
With central and state governments providing 50-75 percent subsidy on farm equipment and seeds, the company is hoping to goad farmers into moving up the value chain by taking to mechanised farming.
"We will meet the local administration for the subsidy and arrange institutional financing to motivate farmers to shift the culture of cultivation, be it paddy, cereals, cash crops, plantations and other agri-based products. We will also introduce specific implements for horticulture and floriculture at a later stage."
Ratnagiri marketing director Chandra Mohan said the growing agri-labour shortage and spiralling wages would force farmers to increased usage of technology and implements such as weed cutters, chain saws, power cutters, hedge trimmers, earth borers and motorised backpack power sprayers to reduce operational costs.

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