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Application Economy and “soft” Commodity Businesses

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Agriculture accounts for 6.8% of total gross capital formation. India ranks amongst Top 3 globally in the production of fruits & vegetables, Spices and some food grains. India is amongst Top 10 leading exporters in the world. India’s export grew at a CAGR of approximately 25% in the last 5 years. FDI inflows in the agricultural sector has touched USD $2Billion.

 These are some of the facts related to the multi-billion dollar agricultural sector in India. It has a huge mix of organized and unorganized players. We connected to thousands of such players and kept wondering -- How can they sustain the future growth without operational efficiency and productivity? How can they meet the demands of the global food industry? How will this industry face the sustainability demands?

Organized or unorganized, businesses have to take care of the environmental performance by looking into the commodity production systems, waste management, energy & water management, pollution management and continuous improvement in their supply chain management.

The businesses have to be focused on the economic performance by continually creating financial value and customer satisfaction.

The businesses have to pay attention to the Social performance by committing to food quality & safety and labor/employee management.

In the last decade, India has seen a dramatic velocity in the business problems being solved by IT and newer business models appearing in the marketplace that is threatening to jettison the older ways of doing business. IRCTC, Flipkart, redBus, Internet Banking are a few examples.

The next decade will see the “soft” commodity businesses of India being written by IT – welcome to the application economy!



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Guest Tuesday, 19 March 2019