Marketing of Agri Products -MJR-01.06.2011

Marketing of Agri Products:

Janakiraman M Head – APC, Chennai June 1, 2011 Marketing of Agri Products “Every thing can wait But not the Agriculture” Pt. Jawaharlal Nehru

Marketing:

Marketing Concept It is more than selling It induces the customer to buy the products. It attracts the customer to try for the product. Marketing strategies should be always innovative / changing to attract the customer & to retain him with us

Why Marketing ? :

Why Marketing ? It helps to understand customer needs It helps to find out ways & means to satisfy customer needs It helps to innovate our products. It helps to face competition It helps to maximize profits & to ensure Business Development

Essentials of Marketing – 7 P’s:

Essentials of Marketing – 7 P’s Product Price Place Practice / Procedure Promotion Performance People

Marketing – Corporate Clients:

Marketing – Corporate Clients Preappointment Punctuality Checklist TAT – Credit delayed is credit denied Saying No & continuous touch Personal grooming

Marketing – Retail Clients:

Marketing – Retail Clients Market Study Economic Agri Activities Data – Market share, Major activities financed & Recovery Percentage activity wise, historic data (Source – PLP) New Business Ventures Feedback from existing customers Creating visibility (Extn activities) Data Base Farmers Club Check List with application

Farmers` Club:

Farmers` Club Credit must be used in accordance with the most suitable methods of Science and Technology Terms & Conditions of Credit must be fully respected A part of additional income created by credit must be saved Loan instalments must be repaid regularly so as to recycle credit

Farmers` Club - Benefits:

Farmers` Club - Benefits Deposit mobilisation Credit flow & Diversification New business avenues Improvement in Recovery and NPA position Reduction in transaction costs Enhances bargaining power Socio-economic development Extended Arm of the Bank

Requirements:

Requirements Have the knowledge about the products Discuss with officials working in respective vertical and give leads to them. Get reference from the customer to have credit worthy customer. Read the products /Circulars whether it has relevance or not at once. Know current ROI , PC ie BBR , BPLR etc., Find the requirements of the customer by discussion.

Identifying the clients:

Identifying the clients Background of the customer CIBIL, RBI Defaulter list: Willful, Defaulting borrowers and Caution Advice Present Loan portfolio: Sanction letters, account statement Need for Finance – all the depositor may not be credit worthy customer) Observe the unit operations IT Returns/ Financials of last 3 yrs Observe the transactions in the account

Due Diligence:

Due Diligence KYC Compliance Details of Family members Details of Agriculture Land Infrastructure facility: Irrigation/ Assets owned Income Details: Main source, from allied activities Present Banking arrangements: Bank, branch, amount, RoI, Credit history Security verification

General Guidelines:

General Guidelines Parameters: CR: 1.25 , TOL:TNW: 3 to 3.5:1,ICR: 2, DSCR: 1.5 Profit making for the past 2/3 years Investible Grade/above cut off score Satisfactory Credit history Margin: 25% on stock, 25-50% on book debt, for TL: 15-25 % PC: 0.50 to 1.00 % of the loan amount.

Change of Agriculture into Agri Business:

Change of Agriculture into Agri Business Hitech cultivation- Floriculture, Vegetable cultivation Horticulture Mushroom Cultivation Seed Production- Processing plants Agriculture allied activities becoming industrial activity like; Integrated Poultry farming Commercial Dairy farming Fish & Prawn/ Shrimp farming Agro processing

Credit Flow to Agri.:

Credit Flow to Agri. Production Processing Storage Marketing Storage All kinds of Direct Agri lending Storage facility & WHR Term Loan, WC Loan Contract Farming, Base Dose, H&T, LACR-JLG Cold Chain Term Loan, WC Loan

Product wise-Key factors KCCS:

Product wise-Key factors KCCS Big Farmers list, Farmers club KCC`s requirement for entire year WC maintenance + Consumption also Crop Insurance Annual Review- operations in the account Subvention

Slide 16:

Poultry Layer Broiler Parent Breeding Commercial Farming Own production Contract Farming System of Rearing Layer : 1+1+3 1+1+5 Broiler : All in all out Minimum Economic Size Feed Manufacturing Pledge Loans NPA Norms

Dairying:

Dairying Rearing of Animals Commercial Dairy-Liquid Milk Individual Farmers Dairy Tie-up Contract Arrangements Lactation Schedule Disbursement in batches NPA Norms

Farm Mechanization:

Farm Mechanization Big Farmers, Scope for own use Close Monitoring as yearly installments End use verification

Horticulture Development:

Horticulture Development Long Gestation period- Suitable Moratorium Recovery of Interest First Subsidy Alternate Source of Income Stage wise Disbursement Ground water Norms Soil Profile Study Suitability of Varieties NHB cost Norms

Thank You:

Thank You