Indian farmers can come out of debt, if the middlemen are eliminated. Kisanmade, an e-commerce startup from Moradabad, is heading in this path and tries to put an end to the problems of farmers with a revolutionary notion of ‘family farmers.’
At a time when most startups are looking to turn profitable by rushing to serve the urban consumer, 27-years-old, Rajneesh Vishnoi of Bijnor Uttar Pradesh, along with his cousins, wants to help farmers. He conceptualised the idea of a 'family farmer'.
The idea is quite similar to that of a family doctor who is consulted on routine checkups and minor illnesses in the family. A family farmer, as one may surmise, takes on the task of providing all the food needs of a family. From fruits and vegetables, to pulses and cereals, as well as spices and all the other items required in a household kitchen can be bought from the family farmer.
Rajneesh’s venture Kisanmade is an e-commerce platform set up in Moradabad to empower farmers by eliminating the intermediary between the farmer and the consumer.
The business model
India, being an agrarian economy, has around 60 percent of its population dependent on agriculture. In the past few years, the farming sector has been in distress due to consecutive droughts, flooding, debt, failure of crops and structure of the agricultural market – with corrupt middlemen exploiting farmers by taking advantage of the low minimum support price (MSP) of food grains and by buying produce at fairly lower prices than what a farmer deserves.
Kisanmade is an online platform where consumers can directly buy the produce from the farmer. The venture has done away with middlemen like wholesalers, retailers, distributors, mandis and malls, making it pretty easy on the pocket for the buyer. Rajneesh says, “I strongly believe that Indian farmers can become rich and come out of debt. They don’t get the actual value for their crop; rather it is the middlemen who are making most of the money. The farmer sells his produce at a very cheap rate to middlemen or in sabzi mandi but it reaches the purchaser at a hiked price. It is the intermediaries who hike the price.”
Kisanmade plans to increase the farmer’s income and decrease the kitchen’s expense by 10-15 percent. Currently, the business is operational in Moradabad and also in areas of Ghaziabad, like Vaishali, Kaushambhi, Vasundhara, Indirapuram.
Even though it appears to be similar to other online grocery platforms catering to semi-urban areas Rajneesh says their end goal is inherently different. “There are many B2B startups for vegetables and fruits that claim to help the farmer, but in reality, they buy the produce at very low rate and just save up on the mandi tax. Our concept is totally based on the benefit of farmer and nothing else,” he explains.
How it all began
Coming from an agricultural background, the concept of 'family farmer' came up when Rajneesh was in his second semester of MCA. His family did not have the money to pay his college fee. They were stuck, not having received any payment from the mill owner for the sugarcane crops they had harvested. Rajneesh then had to take a loan from the bank to pay off his fee. His is not an isolated situation. This happens with many sugarcane farmers who languish in the debt cycle due to non-payment of their dues by the mill owner.
After pursuing his MCA, Rajneesh shifted to Noida in 2012. Meanwhile, he started his research on how he could help the farmers. By August 2015, he quit his job and started Kisanmade by investing his savings. But the problems inflamed with the demonetisation on November 8, which struck him hard and delayed the procedure. It was only in January this year that he was able to start his operations in a full-fledged manner.
Since then, the path hasn't been without roadblocks. A major obstacle has been the lack of Internet usage among those living in the semi-urban region that the startup is operating. Presently, the orders Rajneesh gets are mostly over phone, rather than being placed online.
Another troubling factor are the middlemen. “Certain crops such as spices and pulses have to be processed in mills. Then only the consumer would buy produce. Therefore, eliminating the middlemen becomes a task and for that I need to set up mills. Other than mills, there are infrastructural issues: we don't have enough cold storage or proper supply-chain systems, which leads to wastage of food crop. It is the rich middlemen who have proper storage facilities and he also gets subsidy from government to store the produce,” Rajneesh explains.
The main competitors for Kisanmade are the heavily-funded grocery websites such as Big Basket and Grofers. “The biggest difference is that the last man standing actually doesn’t get anything in this whole big business. The farmer is still in poverty and distress. We are just trying to make a difference in the lives of the farmers who bring the food to our plate,” he adds.
A way forward
Rajneesh plans to go the organic route and educate the farmers about the harmful effect of pesticides. He believes that his concept is not just a startup idea but “a revolution for the farming community.”