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ITCs Agri Business
- 8. Production Channel Prior to e-Choupal Farmer Regulated Markets (15-75%) Trader Commission Agent Wholesaler (20-80%) Village Trader Ghani Producer Coop (3-5%) Cooperative Mill
- 9. The e-Choupal Business Model Farmer Regulated Markets (Fair Market Price) Private Miller Commission Agent (hired by ITC) Village Trader Ghani Producer Coop (Negotiated Price) Cooperative Mill E-Choupa l ITC ITC Commission
- 10. Transaction Costs in Mandi Chain Soybeans Example Farmer Incurs Trolley Freight to Mandi = 120 Labour = 50 Kacchha Adat = 150 Handling Loss = 50 Rs per MT 370 Processor Incurs Commission to Agent = 100 Cost of Gunny Bags (net) = 75 Freight to Factory = 120 Handling at Mandi = 40 335 Total Chain 705
- 11. Transaction Costs in Choupal Chain Soybeans Example Farmer Incurs Trolley Freight to ITC Hub = 120 Labour = 50 Kacchha Adat = 150 Handling Loss = 50 Rs per MT 370 Processor Incurs Commission to Sanchalak = 100 Cost of Gunny Bags (net) = 75 Freight to Factory = 120 Storage & Handling at Hub = 40 335 Total Chain 705 120 50 Cash Disbursement Costs = 50 215 335
- 14. Thank you