Question What are the impediments in marketing and supply chain management in developing the food processing industry in India? Can e-commerce help in overcoming this bottleneck?
Answer: India is an agriculture-oriented economy in which large section still depends on the farm and its product for a living. This provides a great opportunity for developing a supply chain and marketing for connecting producers and consumers. But there are many problems in this endeavor.
Impediments in marketing and supply chain management
- Presence of middlemen
Middlemen act as an interface for both sellers and consumers as they facilitate the trade of goods in India. But they also act as impediments in better supply chain as they reduce profits for producers and better quality products for consumers. Their presence does not allow direct contact between sellers and buyers.
- Lack of transportation infrastructure
Sellers in one part of the country cannot sell products to another part due to a lack of proper resources for transportation. The cost of transportation cannot be handled by a single seller and they need support from middlemen for making that happen.
- Lack of awareness
Producers at the bottom of the production chain are unaware of the opportunities they have in expanding their business due to lack of knowledge. This acts as the biggest impediment in hampering better supply chain management.
How e-commerce can help in overcoming the impediments
- Facilitating the easy movement of goods
The biggest advantage provided by e-commerce is that they look after the challenges of transporting goods from seller to buyer. This will remove the greatest impediment that stops direct business between producers and buyers of food products.
E-commerce operates in a way that makes business profitable for sellers as well as buyers, especially agro-industry. This allows them to sustain for a longer duration without any need for credit. The profitability makes this model successful than the traditional ones.
Thus, e-commerce provides large opportunity foragro business expansion in India as it allows greater interaction between sellers and buyers. This will allow smaller businesses to sustain and thrive.