REPORT ON

FARM HARVEST:
A DISTRIBUTION DILEMMA
SECTION:

Mittal School of Business, Lovely

Professional University, Phagwara-
144401, Punjab, India
2021
Name Registration Peer Section
no. rating
1. Shilpa Sharma 12101952 10 Q8E19

2. Ria Hembrom 12102014 10 Q8E19

3. Sandra Santhosh 12102019 10 Q8E19
4. Payal 12101920 7 Q8E19

5. Shiksharaj 12101900 Live Q8E19

project
INTRODUCTION

Farm Harvest was established in 2010 and started producing and processing
top-quality sweet corn through a close-knit community of farmers. The
company tapped the existing distribution network for fast-moving consumer
goods and, in a phased manner, launched the product in 10 cities in South
India over a period of five years. Over the years, the company had been
selling fresh sweet corn to consumers across the southern part of India.

By 2016, the company was cultivating sweet corn on over 120 acres
through cooperative farming. It had also forayed into export markets after
2014. The company’s cutting-edge manufacturing facility ensured fresh
produce was processed in a clean and hygienic environment. By using the
latest Japanese retort technology with temperature control, the packaged
sweet corn stayed fresh for a period of six months without any added
preservatives.

How the Sweet Corn Production Started in India

Sweet corn is a variation of the maize crop, which was a specialty crop in which
the sweetness of the corn was enhanced due to a particular gene. Maize was an
important cereal of India and was grown on over 4 percent of the country’s total
cultivable area. The country produced 1.7 million tons in 1950–51, rising to 19.6
million tons in 2014–15. There had been large variations in the production of
maize in India since the country’s independence in 1947. Over the last 10 years,
sweet corn had been the fastest-growing maize crop in India, showing an output
growth of 56 percent in that period.

The Insights-

Farm Harvests were solely dependent on the distributors. The company operated
with two to three distributors in each of the cities where it had a presence.
Distributors were responsible for supplying the requirements to small vendors and
network of retailers Staffed kiosks at malls and theatres. Retailers preferred buying
multiple packs for reselling. The purchase happens from retail outlets and is Used
at home at further processing.

There were customers who liked to purchase from a retail outlet and would take
the sweet corn home for further processing. Some customers liked to eat at the
place of purchase. Apart from these, many small retailers from nearby areas liked
to buy multiple packs and resell the packs in their local neighborhood. Farm
Harvest classified this line of business as Ready to Eat sales. Farm Harvest had the
breakdown of the price and commission at various points in the distribution
channel.

Major cities

Farm Harvest focused on 3 major states. They are Tamil Nadu, Kerala, and
Karnataka. In Tamil Nadu, major cities were Chennai, Coimbatore, Salem, Trichy,
and Madurai. The cities of Kerala include Kochi, Trivandrum, Trichur, and
Palakkad. Bangalore was the only major city from Karnataka.

Current Distribution Strategy of Farm Harvest

Farm harvest is currently present in 5 key cities of Tamil Nadu, 4 cities in Kerala,
and Bangalore city in Karnataka. At present, Farm Harvest is using the
technique of distribution by appointing distributors in different locations to
sell the products. The placement of products through distributors is an
indirect selling chain which is not very useful especially in case of
perishable products. The products of Farm Harvest are perishable in nature
and hence, the indirect channel, may not be very suitable for them.

Problem 1- Wrong Distributor Profiling

Initially, they appointed wholesalers as distributors for fresh corn and they added
the products Ready to Eat & Kiosk business with them. The wholesalers were not
keen on widening the distribution.

Solution –

• Adding more manpower to the distribution channel or can think in another

pattern of changing the entire distribution channel to a zero level. The newly
added manpower can be utilized
• To check if the distribution is done at the right time
• And keep on checking on the retail shops to assure that sufficient stock is
been filled with them
• And if the packages are well promoted by the retailers
• And also checking if the products are well showcased in the well visible area
of the shop
• For a particular amount of distribution, the company can give incentives or
 extra bonus makes this works in a positive manner through the distributors

Problem 2- Poor Distribution

Ready to Eat requires an intense presence in departmental/supermarket stores.
Farm Harvest failed in establishing the same.

Solution-
Targeting customers in crowded places like movie theaters, amusement parks, etc.
to get their attention of them which can increase the demand initially. Small stalls
can be organized to get ahold of the kids as they are attracted to the food and
gaming zones more.
Creating an online website for the products and taking the support of the internet,
which means parallelly keeping an online website and promoting the distribution
through that way can also meet the current and future needs of distribution on the
proper track

Problem 3- Manning Kiosks

Lack of adequate manpower in Kiosks further resulted in deterioration of sales of
the Kiosks.

Solution-

• Employ own sales representatives in the major cities

• Subsidize 50% of two sales representatives’ salaries
• Manage the additional expenses
• Look out for kiosk costs.
Based on the information in the case, the ROI of the distributors in the cities of
Chennai, Coimbatore & Salem
Available data:
The kind of business turn overdoing, the current distributor model is not a viable
one. My suggestions are 1. Farm Harvest should take over the distribution. 2.
Average sale of 3L to be looked at in each city. This can be improved by
distribution penetration, proper kiosk supplies, and man. 3. FOS coverage plan has
to be changed like weekly coverage for Super A & A category and B&C can be
covered on a 15 days frequency. Each town should have 2 salespersons and each
FOS should cover 500 outlets (8 Super A& A on a weekly basis & 30 B&C
category outlets on a once in 15 days basis). They can also take orders from current
wholesalers too. 4. ROI with a 35% margin will give a 29% ROI initially.
Detailed working as below.
CONCLUSION

• A proper management system will bring a lot of growth to the organization.

• The addition of efficient manpower can make each step of the system more
effective

• Working on different types of customers and attracting them in public or

crowded places will get reach for the products

• Managing the total expenses and giving additional benefits to the

distributors brings a lot more difference in the reach of products

• Getting reach of the product through the internet will empower the company
and its products in the current scenario and future as well