BigBasket bats for crisis-hit farmers

At a time when onion prices touched an all-time high of Rs 70-80 per kg in October, BigBasket sold them for Rs 29.9 per kg for five days in the month. It is part of the Bengaluru-based company’s plan to offer produce at lower rates to customers while protecting the interests of crisis-hit farmers who are its main suppliers of fruits and vegetables. 

The Alibaba-backed company introduced the Farmer Connect programme in 2016 to cut the supply chain and ensure quality of the fresh produce. As a result, it helps increase farmers’ income by 10-15 percent. BigBasket has set up 30 collection centres across the country and sources 60 percent of fruits and vegetables directly from farmers, thereby eliminating the middlemen. 

“We have collection centres in cities like Nashik, Agra, Vijayawada and so on. Each centre has around 20 agronomists who educate the farmers about the quality we require and standards to follow. They also assist farmers in terms of when and which crop should be grown, which seeds and implements to be used,” says Vipul Parekh, who co-founded BigBasket in 2011 with four others. “These farmers deliver at the collection centre, where we grade, process and check for quality. We work with 20,000 farmers.” 

“We don’t see much of contract farming in India which BigBasket is doing. It is guaranteeing farmers that it will buy the harvest. And farmers are happy because most of them don’t have a clear demand visibility of what they are producing unlike other industries. The biggest challenge in agriculture is that most of the production is supply-driven rather than demand-driven,” says Hemendra Mathur, venture partner with Bharat Innovation Fund. 

BigBasket is owned and run by Supermarket Grocery Supplies. It recently closed $150 million in funding led by Mirae Asset-Naver Asia Growth Fund, Alibaba and the UK government-owned CDC Group, valuing the company at over $1 billion.