Kotak Mahindra Bank
FreshoKartz Agri’s success story proves that you must always keep Plan B ready
Friday August 27, 2021,
3 min Read
What started as a dream in a small town is now a growing company with a presence across India. FreshoKartz Agri’s initial journey wasn’t easy, but it was their resilience and determination that helped them write their success story.
Coming from an agricultural background, Rajendra Lora always knew he had to do something to uplift the farmers of the nation. Growing up in a small town in Rajasthan, the FreshoKartz Agri co-founder and CEO was acutely aware of the challenges farmers were facing. The trigger hit when he was in Mumbai and noticed that the prices of vegetables sold in the market were very high as compared to the prices of produce sold by farmers. This massive difference prompted Rajendra to start up FreshoKartz Agri with the aim to connect farmers directly to the market.
“I had an idea, I built a team and we put in money from our own pockets.” he says. But it was only once they came into the market that they noticed there is a 30 to 60 day payment cycle with many hidden costs which they hadn’t foreseen. As they incurred heavy losses, they lost most of their team too.
This is when they kicked their Plan B into action. They changed their business model from directly buying from farmers and selling to B2B customers like hotels and cafes, to now directly buying from farmers and selling to bigger clients like Reliance and Adani. They also realised that they needed to create services for farmers. To that end, they started a network of centres in villages that sold seeds and fertilisers to farmers besides offering financial services to them and installing soil testing kits in villages. But it was during COVID-19 that their services got a massive boost. As the country went into lockdown, they received a lot of orders from farmers.
To bounce back from the losses they incurred, they took the help of Kotak Mahindra Bank. “Some of our money came from FDI so Kotak helped us a lot in that aspect. We also needed to insure our stock and get employee health insurance, so these services we’ve taken from them as well. On Kotak’s advice, we insured all our physical centres, which was a good decision,” Rajendra says.
Today, the company is in a stable position. But the past four years have taught them a lot. “At one point, we had a team of 30 to 40 people but as we changed our model, my wife and I were the only people left. We started building from there and now, we have 80 people. That was the driving factor for me,” Rajendra explains.
He also realised that it is essential to have plans to manage your cash flow. He advises budding entrepreneurs to consider the company money or investor money as their own money and treat it as cautiously as they would treat their own.
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The views expressed by the speaker in this video are personal. This video is for information purposes only.