Supply Chain - India Allogistx International Inc. 2130 Huntington Drive suit 205 South Pasadena, CA 91030 [email protected] Office: 323.254.9550 Fax:

Supply Chain - India

Allogistx International Inc.2130 Huntington Drive suit 205South Pasadena, CA 91030 [email protected]: 323.254.9550Fax: 323.315.9311

Allogistx International Inc. India124-A, Naman Plaza1st Floor, Behind Shoppers Stop,Kandivali (west)Mumbai, India 400 [email protected]

Agenda

-Evolving Indian Economy

- Changing Supply Chain Dynamics

- New Growth Drivers

- Supply Chain Challenge

- Emerging Solutions & New Platforms

2

India is Growing! Source: Economist

• India will be the third largest economy by 2040 3

Urban Population Increasing

• Urban population projected to cross 500 million by 2025

- Cities are expanding Agro Enterprise Without Borders, Singapore, 2009 4

Food Consumption Increasing

• Food demand increasing - Quality preference increasing 5

Retail Sales Growing

• Retail sales cross US$ 900 billion by 2010 Agro Enterprise Without Borders, Singapore, 2009 6

Growth Drivers

Demographic advantage: Young population Credit availability Increasing discretionary incomes Increasing retail space

7

Challenges

Inefficient Supply Chain

Infrastructure

Low Technology Penetration

Food Safety

Unorganized sector

Bureaucracy

Sanjeev Asthana Agro Enterprise Without Borders, Singapore, 2009 8

Disjointed Food Supply Chain

Village Commission

AgentSub Farmer

District Commission

AgentWholesaler Retailer Consumer

• Low yield / non-standard qualityFarmer

• No control on quantity / quality of raw material

• Price de-linked from market Processor

• Unscientific and unhygienic handlingVillage

• Lack of infrastructure leading to loss of quality

Commission Distributor • Poor market access Agent

• Loss in trade passed onto farmer

• Lack of infrastructure leading Mandi / Local • No infrastructure for handling/grading Retailer

agents •Price quality correlation not assured

• High prices Transportation

• Unscientific method leading to loss of quality /damages Consumer • Limited choice

• Inadequate infrastructure

Wholesale •Rampant wastage

Non value adding players •Opportunistic profiteering

Sanjeev Asthana Agro Enterprise Without Borders, Singapore, 2009 9

Poor Supply chain Infrastructure • Poor infrastructure facilities for

StorageTransportationProcessingPackagingDistribution

• About 3,500 cold storages/warehouses Only 13m tons of storage capacity for production or 140 mn

tons of Fruits/Vegetables

Sanjeev Asthana Agro Enterprise Without Borders, Singapore, 2009 10

Supply Chain - High Costs • Inefficiencies in Distribution

• Lack of cold chain and warehouse structure• Logistics costs in India are among the highest• Fragmented retail structure

• Supply Led Growth

• World: 72%

• India: < 1%

• More than 5 million retail outlets selling food products • Limited focus on food safety and hygiene • Limited choice to the consumer

• Low investment in quality control, product innovation, private labeling and market intelligence

Agro Enterprise Without Borders, Singapore, 2009 11

Underdeveloped Processing Industry

• Fruits and vegetables Country % Processed

Malaysia 83% 2-3% of produce is processed8%-37% lost in storage and transportation

South Africa 80% Phillipines 78%

- Inadequate storage and cold chain Thailand 72%

Brazil 70%

USA 65% - Inadequate processing and marketing infrastructure India 2-3 %

• Grains 3% is lost in storage

Opportunity Significant growth potential & a challenge

Agro Enterprise Without Borders, Singapore, 2009 13

Way Forward

Private-Public-People Partnership can

be growth engines for Supply Chain

*Have someone who is Local as

well as Global help you realize

these opportunities…

Agro Enterprise Without Borders, Singapore, 2009 18

Thank You!

Allogistx International Inc.2130 Huntington Drive suit

205South Pasadena, CA 91030 [email protected]: 323.254.9550Fax: 323.315.9311

Allogistx International Inc. India

124-A, Naman Plaza1st Floor, Behind Shoppers Stop,Kandivali (west)Mumbai, India 400 [email protected]

Thank You!