Published by

Assessment and Categorisation of

Farmer Producer Companies
in Maharashtra
 Published by

Assessment and Categorisation of

Farmer Producer Companies
Published by

in Maharashtra

Assessment and Categorisation of

Farmer Producer Companies
in Maharashtra
 Published by
Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH

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August, 2018

02
 Preface

This study was undertaken to identify the capacity development support requirements of Farmer Producer
Organisations (FPOs) from the perspective of mainstreaming bankable business models; emerging from
the rich experiences of Umbrella Programme for Natural Resource Management (UPNRM).

UPNRM is a collaborative initiative of National Bank for Agriculture and Rural Development (NABARD),
Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) and KfW Development Bank to support
climate resilient Natural Resource Management (NRM) based livelihood projects across India through
loans and need based grants.

The study conducted in Maharashtra has helped to define a structured approach for the capacity
assessment of Farmer Producer Companies (FPCs). This report has been produced through the study on
the status of FPCs in Maharashtra. Additionally, a tool is being developed to undertake similar exercises
in other states. Currently, assessment of FPCs in Karnataka is underway. We hope such assessments
will provide a basis for policies and capacity building support for organisations, to help them tailor their
interventions for the emerging contexts.

03
CONTENTS
Abbreviations....................................................................................................................... 08
Executive Summary............................................................................................................ 09
1. Introduction and Background......................................................................................... 15
1.1 Introduction............................................................................................................. 15
1.2 Genesis of Farmer Producer Companies (FPCs) in India...................................... 15
1.3 Status of FPCs in Maharashtra.............................................................................. 16
1.3.1 Assessment of FPCs in State........................................................................ 16
1.4 Objective of the Study............................................................................................ 17
1.5 Approach and Methodology.................................................................................... 17
1.5.1 Secondary Research................................................................................... 17
1.5.2 Data Collection............................................................................................ 17
1.6 Analysis & Report Writing....................................................................................... 18
1.6.1 Collective Profiling of FPCs......................................................................... 18
1.6.2 Scoring, Ranking and Categorisation of FPCs............................................ 18
1.6.3 Co-relational and Descriptive Analysis........................................................ 18
1.6.4 Strategic Action Plan................................................................................... 18
2. Profiling of FPCs............................................................................................................ 21
2.1 District-wise Spread of FPCs Assessed................................................................. 21
2.2 Support Agencies & Resource Institution............................................................... 21
2.2.1 Resource Institution & Producer Organisation Promoting Institutions........ 22
2.3 Number of Villages Covered by FPCs.................................................................... 23
2.4 Memberships.......................................................................................................... 23
2.5 Land Holding Pattern of Member Farmers............................................................. 24
2.6 Caste of FPCs Members........................................................................................ 24
2.7 Education of CEO/MD............................................................................................ 24
2.8 Board Meetings...................................................................................................... 26
2.9 Business Activities.................................................................................................. 26
2.10 Members Participation............................................................................................ 27
2.11 Number of Equity Shareholder............................................................................... 27
2.12 Annual Turnover & Net Profit.................................................................................. 28
2.13 Annual Audits & Patronage Distribution.................................................................. 29
2.14 Education of CEO & Members’ Strength................................................................ 29

05
 2.15 Experience of CEO & Annual Turnover.................................................................. 30
2.16 Number of Villages Covered and Equity Share Holder.......................................... 30
2.17 Caste and Board Meeting....................................................................................... 31
2.18 Land holding and Turnover..................................................................................... 31
3. Ranking and Categorisation of FPCs............................................................................. 33
3.1 Categorisation of FPCs.......................................................................................... 33
3.2 Scoring Mechanism................................................................................................ 33
3.2.1 Identification & Grouping of Parameters..................................................... 33
3.2.2 Normalisation of Value to percentile............................................................ 34
3.2.3 Marking of Scores....................................................................................... 34
3.2.4 Allotting Weightage to the Scores............................................................... 34
3.2.5 Summation of Scores.................................................................................. 34
3.3 Categorisation of FPCs.......................................................................................... 34
3.4 Characteristics of Categories................................................................................. 35
3.4.1 Organisational Profile.................................................................................. 35
3.4.2 Membership Profile..................................................................................... 35
3.4.3 Business Activities....................................................................................... 36
4. Correlation Analysis of Different Categories.................................................................. 39
4.1 Correlation Assessment.......................................................................................... 39
4.2 Memberships and Governance.............................................................................. 39
4.2.1 Membership Campaign Strength................................................................ 39
4.2.2 Board Meeting............................................................................................. 40
4.2.3 Annual General Meeting.............................................................................. 40
4.2.4 Use of FPC Services by Members.............................................................. 41
4.3 Finance Management............................................................................................. 41
4.3.1 Accountant in FPCs..................................................................................... 41
4.3.2 External Audits............................................................................................ 42
4.3.3 Balance Sheet............................................................................................. 42
4.3.4 Record Keeping.......................................................................................... 43
4.3.5 Access to Credit.......................................................................................... 43
4.3.6 Profitability................................................................................................... 44
4.4 Management........................................................................................................... 44
4.4.1 CEO/Manager in FPCs............................................................................... 44
4.4.2 Business Plan Preparation.......................................................................... 45
4.4.3 Standard Operating Procedures (SOPs)..................................................... 45
4.4.4 Use of Management Information System (MIS) Software........................... 46
4.4.5 Awareness about Schemes......................................................................... 46
06
 4.5 Marketing................................................................................................................ 47
4.5.1 Marketing Services to Members.................................................................. 47
4.5.2 Use of Infrastructure.................................................................................... 47
4.5.3 Pricing Mechanism...................................................................................... 48
4.5.4 Value Addition.............................................................................................. 49
4.6 Services Provided by FPCs.................................................................................... 49
4.6.1 Financial Services....................................................................................... 49
4.6.2 Input Supply................................................................................................ 50
4.6.3 Advisory Services........................................................................................ 51
4.6.4 Transportation............................................................................................. 51
4.6.5 Information Service..................................................................................... 52
4.7 Impact Assessment................................................................................................ 52
5. Recommendations and Strategic Action Plan................................................................ 57
5.1 Recommendations.................................................................................................. 57
5.2 Strategic Action Plan.............................................................................................. 60
Annex-I: Segmentation and Scoring.................................................................................... 63
Annex-II: Correlation Tables................................................................................................ 66

07
 ABBREVIATIONS
AGM Annual General Meeting
AIDP Agriculture Infrastructure Development Investment Project
ATMA Agriculture Technology Management Agency
BOD Board of Director
CA Chartered Accountant
CEO Chief Executive Officer
DPR Detailed Project Report
FIC Farmer Producer Company Incubation Centre
FPC Farmer Producer Company, an FPO registered under Companies Act
FPO Farmer Producer Organisation
GCA Gross Cropped Area
GDP Gross Domestic Product
GoI Government of India
JFPR Japan Fund for Poverty Reduction
KRA Key Result Area
KVK Krishi Vigyan Kendra
MACP Maharashtra Agriculture Competitiveness Project
MAHA-FPC MAHA Farmers’ Producer Company
MD Managing Director
NABARD National Bank for Agriculture and Rural Development
NABKISAN Nabkisan Finance Limited
NBFC Non-Banking Financial Company
NGO Non-Governmental Organisation
OBC Other Backward Class
PO Producer Organisation
POPI Producer Organisation Promoting Institutions
PRODUCE Producers Organisation Development and Upliftment Corpus
RI Resource Institution
RoC Registrar of Companies
SC Scheduled Caste
SFAC Small Farmers Agribusiness Consortium
ST Scheduled Tribe
TNA Training Need Assessments

08
EXECUTIVE SUMMARY
India is the land of marginal and small farmers. According to the Agriculture Census 2010-2011, more
than 67 per cent of the farmers are marginal farmers i.e. they hold less than one hectare of land. Nearly
18 per cent of farmers are small land holders who possess one to two hectares of land, 10 per cent are
semi-medium who have two to four hectares of land, 4.3 per cent are medium land holders who have four
to ten hectares of land and only 0.7 per cent of farmers are the large land holders, who own more than ten
hectares of land.

The farming community is facing a lot of constraints due to the small size of operations. These include the
inability to work on economies of scale, low bargaining power because of marginal marketable surplus,
lack of capital, inability to access credit and inputs at subsidised rates, lack of market access and lack of
knowledge and information among others. The primary objective of forming Farmer Producer Companies
(FPCs) is to organise marginal and small farmers into a group which can aggregate its own produce and
collectively market the aggregated produce and collectively buy the inputs. FPCs acts as a platform to
pool in resources and optimally utilise these resources for the collective benefits of the group. The broad
areas of support and services provided by the FPCs are marketing, market information, transportation,
cold storage, irrigation, extension services and technology, input supply, product planning and product
branding.

As of the year 2017 there are more than 5,000 FPCs in India. These FPCs got initial support from the
National Bank for Agriculture and Rural Development (NABARD), Small Farmers Agribusiness Consortium
(SFAC) and state governments. NABARD is presently supporting 1,349 FPCs while SFAC has promoted
814 FPCs in different states. There are various schemes at the state level such as Livelihood Missions that
are also promoting producer companies for various commodities and business activities.

A large number of FPCs are being promoted in Maharashtra by NABARD, SFAC and state agencies
under different projects such as Maharashtra Agricultural Competitiveness Project (MACP), Agriculture
Infrastructure Development Investment Project (AIDP) and Convergence of Agricultural Interventions in
Maharashtra (CAIM).

According, to the Department of Agriculture of Maharashtra, Government of Maharashtra, there are 1,368
registered FPCs in the state. Maharashtra have been among the top states in FPC promotion as it houses
almost 20 per cent of FPCs running in India.

However, despite all the efforts, FPCs are unable to deliver the expected outcome as they are marred by
various issues and challenges which have been listed below.

However, despite all the efforts, FPCs are unable to deliver the expected outcome as they are marred by
various issues and challenges which have been listed below.

zz Poor professional management due to their financial and organisational inability to have competent
Chief Executive Officers (CEOs) and other professionals to manage FPCs.
zz Lack of technical, business and managerial skills in members to build and operate FPCs.
zz Lack of vision and direction from promoters and Board of Directors (BoDs).
zz Low equity base due to low share value resulting in dependence on funds/grants from outside.
zz Weak credit linkages of FPCs even after accessing support from the organisations who are promoting
the FPC.

09
 zz Inability to attract capital or credit from outside due to poor financial climate from banks and promoters/
directors not being able to comply with the legal requirements to access finance.
zz Low awareness of the bankers on FPC concept.
zz Except for NABKISAN Finance Limited (NABKISAN), no other commercial/cooperative bank or Regional
Rural Banks (RRB) has designed a loan product specifically for FPCs and no such loan policy has been
formulated at the corporate level to finance FPCs.
zz FPCs sometimes choose their activity portfolio without keeping in mind their member centrality.
zz The negative experience of modern retailers with producer companies and vice versa. Modern retailers
have not shown enough trust and patience while dealing with FPCs as they fail to understand the social
dynamics of FPCs.
zz Challenges in the delivery of quality product in the required time frame.
zz Every FPC is answerable to their members and it becomes very difficult for the board of FPC, to face
their members in the absence of any loan, input purchase etc.

Under this study, an effort has been made to understand the current status of the functioning of FPCs in
Maharashtra. The FPCs have been categorised as per their performance and on other parameters and
accordingly recommendations have been proposed, to prepare Strategic Action Plan for the state.

As per the records from the Department of Agriculture of Maharashtra, out of 1368 registered FPCs in the
state, assessment of 131 FPCs have been done in 21 districts of Maharashtra. The highest number of
FPCs were covered in Nashik whereas, the lowest numbers were covered in Nagpur.

Detailed profiling of FPCs covered under the study have been done, which has the following important
findings:

zz In Maharashtra, FPCs have been promoted by agencies such as NABARD, SFAC, MACP, Japan Fund
for Poverty Reduction (JFPR), Agriculture Technology Management Agency (ATMA) and some of the
other agencies by the farmers themselves.
zz FPCs covered under the survey covers 5-50 villages and have a membership base ranging from 50 -
1000 farmers.
zz Most of the FPCs are dominated by marginal and small farmers. FPCs also have a good representation
of various social classes such as Scheduled Castes (SCs) / Scheduled Tribes (STs), Other Backward
Classes (OBCs) and general caste.
zz Most of the FPCs (almost 76 per cent) have appointed CEOs / Managers for taking care of their day-
to-day operations of FPCs. However, educational qualification of these CEOs / Managers varies from
below high school to post-graduation.
zz A large number of FPCs (29 per cent) are not conducting any marketing activity for the participation
of members. There are 28 per cent FPCs, which have a participation of fewer than 100 members in
the activities conducted by the FPCs and 37 per cent FPCs have witnessed participation of 100 to 500
members in the activities conducted by them.
zz The range of turnover of FPCs varies from few lakh rupees to above a crore. However, maximum FPCs
do a business of upto INR 50 lakhs only and have a profit of less than INR 5 lakhs. Almost 45 per cent
of the surveyed FPCs have not mentioned any profit from the business activities during the survey.
zz There is a lack of adoption of practices for keeping accounts updated, conducting audits and fulfilling
statutory requirements.
The categorisation of FPCs have been done by developing derived variables, based on the combined
values of selected primary parameters, the information for which was collected during the survey. The
categorisation criteria developed are discussed as under.
10
 Categories Parameters
Number of villages covered, number of members, number of equity shareholders,
Organisation Profile
growth in number of members (in absolute terms) & FPC age in days
Member Profile Land holding pattern
Management CEO/Managing Director (MD) education and CEO/MD experience
Business Profile Activities undertaken by FPCs
Outcome Annual turnover, net profit patronage bonus and member participation

Based on these parameters, following categories have been defined.

Number
Categories Remarks
of FPCs
zz Relatively larger number of members and a large number of
shareholders(average of 919 members).
zz It has a relatively larger representation of marginal and small holders.
A 9
zz Large number of general category members.
zz This category has maximum business activities (seven types of business
activities) and services for its member farmers.
zz Medium level of memberships (average 664 members) and shareholders.
zz The category has a medium level of representation of marginal and small
B 42 holders.
zz Upto 50 per cent membership of the general category.
zz This category of FPCs have five business activity types for its members.
zz Relatively smaller membership (435 members) and shareholders.
zz Although there is good representation of marginal and small holders, but
relatively lower than category A & B.
C 80
zz This category has equal representation of SC / ST, OBC and general caste
members.
zz This category has only two types of business activities for its member farmers.
Total 131

Each category mentioned above has different approaches of various activities related, to membership
campaign, membership engagement, FPC governance, handling of accounts and process on keeping
records as well as for business promotion.

In category A, FPCs have more aggressive membership campaigns, regular BoD meetings, Annual
General Meetings (AGMs) and follow the procedures of Standard Operating Procedures (SOPs) laid
out for these meetings. In addition, they have also appointed CEOs/Managers and paid accountants for
managing operations of the FPCs and for adequate record keeping. A larger number of members are
actively participating in the business activities of the FPCs.

In the case of Category B FPCs, the governance-related issues are not tackled adequately wherein FPCs
do not have a mechanism for actively engaging members in decision making. There is a lack of structured
feedback mechanism from the members to the management of FPCs. Also, there are issues with some of
the FPCs related to regulatory/statutory compliances.
11
 For Category C FPCs, there are more basic issues, which are related to the development of institutional
structure and deployment of resources for day-to-day business activities.

These issues have also got reflected in the impact analyses for various categories of FPCs related to
input availability, input prices for members, impact on output prices and output management, access to
subsidies and credits as well as access to knowledge and infrastructure.

It has very clearly emerged from the assignment that the first category of FPCs which have achieved
a certain scale, are good as an institution and have adopted a process for governance (category A).
The second category of FPCs who are trying to adapt to the governance system and achieve financial
sustainability (category B). The third category of FPCs are struggling at an initial level of sustenance,
making basic institution work and then to strive for scaling-up businesses (category C).

To focus on scaling-up businesses,

Category –A: Enterprising profitability and adopting to
processes.

To work on governance systems,

Category –B: Intervening participation in decision
making and business volumes

To build on institution,
Category –C: Beginning awareness creation, member
engagement and business plan

Recommendations have also been made on specific points. Category-wise recommendations are as
under.

Category-A
zz Strengthening of existing institutional structure and governance mechanism.
zz Setting-up committees under the board for taking policy and business decisions related, to specific
verticals.
zz Creating a system for customer feedback mechanism and balancing demand and supply scenario.
zz Focusing on the scaling-up of business by developing formal marketing arrangements with large-scale
buyers and creating its own brand.
Category – B
zz Deploying resources for hiring technical manpower for better organisation of operations and engagement
with the members.
zz Setting-up proper governance structure, organising regular meetings, record keeping and procedure for
decision making on policy and businesses.
zz Creating members database for adequately assessing the scale of businesses for input, output and
services.
zz The thrust of adhering to requirement of compliances and proper accounts management.
zz Developing formal marketing arrangements.
Category – C
zz Focusing on developing a cohesive institution with homogenous members.
zz Actively promoting membership campaign for wider outreach, also setting up formal system for
member’s active engagement in businesses and decision making
12
zz Deploying required manpower for the day-to-day operation of FPCs.
zz Working for setting-up governance structure and regularisation of BoD and AGM meetings.
zz Proper accounts control system and record keeping along with arrangement for regular audits of the
accounts.
zz Preparing short-term and medium-term business plans for the FPCs and arrangement of capital for
execution of the proposed business plan.
Strategic Action Plan
For resolving the multifarious challenges, it is proposed that a customised FPC Incubation Centre (FIC)
shall be set-up in Maharashtra. The proposed Incubation Centre, taking a clue from this report, can work
further on gathering insights of FPC promotion work in the state and can develop a solution best suited for
local needs. Broadly the proposed FIC shall have the focus on short-term and mid-term strategy, which is
required for urgently assisting the FPCs, which are struggling for their survival.

Incubation Support

Enterprising FPCs/A
Intermediate FPCs/B
Beginner FPCs/ C
• Importance of quality.
• Formal agreements / tie-ups.
• Engagement strategy for members. • Opportunity assessment for
• Business plan preparation. • Networking with financial institutions business expansion.
• Handholding support. for raising capital. • Raising capital for infrastructure.
• Training, capacity building & • Business opportunity identification • Services expansion to members.
awareness on aspects of for scaling-up. • Help on legal matters.
institution development. • Training on compliances. • Awareness on technological
• Networking with successful • Help on legal matters. advancements.
FPCs.

Short-term strategy (category C FPCs) Mid-term strategy (category A & B FPCs)

Shortlisting potential FPCs for support. Shortlisting FPCs venturing into next level of growth.
Support for business planning, expansion and
Providing technical support for business plan
technical support for preparation of Detailed Project
Preparation.
Reports (DPRs) etc.
Networking with industry, potential buyers and
Networking for peer learning and exposure.
importers
Legal support for developing contract agreements
Providing legal support for compliances.
and other documentation support.
Creating a network of Chartered Accountants Facilitating finance/capital for creating infrastructure,
(Cas) / Auditors to support the FPC. value addition facilities/processing etc.
Facilitating support for raising capital and
networking with the banks / Non-Banking Peer group learning programmes and exposure visits.
Financial Companies (NBFCs) / other sources.
Organising training & capacity building on Introducing the FPC to technologies of future and
regular basis. helping in adoption.
Setting-up help-line for FPCs. Help-line for FPCs.

13
Chapter 1

Introduction and Background

1. INTRODUCTION & BACKGROUND
1.1. Introduction
India is an agrarian economy where 53 per cent of the total population of the country is engaged in
agriculture and allied sector. The sector contributes 17 per cent to India’s Gross Domestic Product (GDP).
As per the 3rd advance estimates of Ministry of Agriculture and Farmers Welfare, the country is expected
to produce 279.5 million tonnes of food grains, 30.6 million tonnes of oilseed, 34.8 million bales of cotton
and 355.10 million tonnes of sugarcane during 2017-2018.

India is the land of marginal and small farmers. According, to the Agriculture Census 2010-2011, more
than 67 per cent of the farmers are marginal farmers i.e. they hold less than one hectare of land. Around
18 per cent of farmers are small land holders who possess one to two hectares of land, 10 per cent are
semi-medium who have two to four hectares of land, 4.3 per cent are medium land holders who have four
to ten hectares of land and only 0.7 per cent of farmers are land holders, who own more than ten hectares
of land.

The small size of the operations results into lot of constraints in farming. These include the inability of
farmers,to work on economies of scale, low bargaining power because of marginal marketable surplus,
lack of capital, inability to access credit and inputs at subsidised rates, lack of market access and lack of
knowledge and information among others.

The Government of India (GoI) has initiated its most ambitious programme based on the objective of
doubling the farm-based incomes by 2022-2023. To attain this target, the GoI has come up with various
initiatives, to support the farmers in improving productivity and marketing of their produce. A programme
based on the principle of aggregation has been implemented by various government organisations i.e.
forming of Farmer Producer Companies (FPCs). This initiative provides an integrated platform, to support
farmers from the production to market realisation of their produce, which will lead to the evolvement of the
most efficient value chain.

1.2. Genesis of Farmer Producer Companies (FPCs) in India

Based on the recommendations of the Y. K. Alagh Committee, the Parliament amended the Companies Act
on 6th February 2002, to incorporate a new section IXA on producer companies. Since the amendment,
producer companies have been known as the fourth form of corporate entity, alongside companies limited
by shares (public limited and private limited companies), companies limited by guarantees and unlimited
companies.

The objective behind such an initiative was to formulate a legislation, to enable incorporation of cooperatives
as companies and conversion of existing cooperatives into companies, while ensuring the presence of
cooperation principles in business. FPCs are incorporated with the Registrar of Company (RoC). By the
end of 2009, around 150 producer companies were registered either as a new entity or through the
conversion of existing cooperatives by following an established statutory process for registering FPCs.

The structure and function of FPCs are similar to any limited company except that only entities, either
individuals or institutions such as self-help groups (SHGs), cooperatives, which are connected to the
primary production can form or join FPCs. While the act details the requirements and criteria for the
formation of the FPC, the FPC promoting agencies have also come out with detailed guidelines for the
formation of Farmer Producer Organisations (FPOs).

The primary objective of forming FPCs is to organise marginal and small farmers into groups which can
aggregate its own produce, collectively market the aggregated produce and also buy the inputs. FPCs acts
as a platform, to pool in resources and optimally utilise these resources for the collective benefits of the
groups. The broad areas of support and services provided by the FPCs are marketing, market information,
15
 transportation, cold storage, irrigation, extension services and technology, input supply, product planning
and product branding.

There are more than 5,000 FPCs in India as of the end of 2017. These FPCs are getting initial support
from the NABARD, SFAC and state governments. NABARD is presently supporting 1,349 FPCs while
SFAC have promoted 814 FPCs in different states. Various state level schemes such as the Livelihood
Missions are also promoting producer companies for different commodities and business activities. Among
the major states where a large number of FPCs have been promoted are Maharashtra, Madhya Pradesh,
Tamil Nadu, Rajasthan, Andhra Pradesh and Telangana.

1.3. Status of FPCs in Maharashtra

Maharashtra contributed to 12 per cent of India’s Gross Cropped Area (GCA) and approximately 13.5
per cent of the country’s GDP from agriculture in 2013-2014. Maharashtra is an important producer of
horticulture crops such as mango, cashew, banana, grapes, oranges etc. It also contributes to almost half
of the country’s production of jowar, cotton, sugarcane and onion. As per the 3rd advance estimates of
Ministry of Agriculture and Farmers Welfare, the state is expected to produce 13.2 million tonnes of food
grains, 4.2 million tonnes of oilseed, 6 million bales (170 kg each) of cotton and 67.8 million tonnes of
sugarcane during 2017-2018.

Despite Maharashtra’s role in the state’s GDP, one cannot overlook the fact that the farmers in the state
are among the most distressed farmers in the country. The major cause for the distress is the dependence
of farmers on the rainfall, as a major portion of the area under agriculture is rainfed. According, to the
Economic Survey of Maharashtra 2017-2018, only 17.9 per cent of the GCA is under irrigation and the rest
is rainfed. The state has been witnessing erratic climate changes, which is further escalating the problem
for the farmers in the state.

Other than the production challenges, the farmers are also dealing with hurdles for marketing the produce.
The problem is even more acute for marginal and small farmers, who form the majority of farmers in the
state. FPCs are seen as a means to help farmers deal with these problems effectively. Many FPCs in
Maharashtra are being promoted by the NABARD, SFAC and state agencies under different projects such
as MACP, AIDP and CAIM. According, to the Department of Agriculture, Government of Maharashtra,
there are 1368 FPCs in the state as of December 2017. Maharashtra has been among the top states
in FPC promotion as it houses almost 20 per cent of FPCs running in India. Maharashtra also has an
apex body of FPCs in the state known as MAHA Farmers Producer Company Limited (MAHA-FPC),
which helps the member companies in marketing and price stabilisation. They have also developed a
web tool for procurement of produce directly from the farmers,to market it to the customers apart from the
procurement of pulses on behalf of government agencies.

With around 1368 FPCs functional in the state, FPCs are expected to increase the income of the farmers
through aggregation and collective marketing. An organised approach to farming is expected to help the
farmers achieve economies of scale. Thus, farmers will be able to increase productivity and reduce the
cost of production. The farmers are expected to benefit immensely through FPCs, as multiple government
agencies are providing financial as well as capacity building support to these FPCs. Also, there are NGOs
providing hand-holding support to the farmers and technical support, to the agencies promoting FPCs.
However, there are many challenges that are hindering the growth of FPCs and in turn the welfare of the
marginal and small farmers in the state. Thus, there is a need to assess the status of FPCs in the state.

1.3.1. Assessment of FPCs in State

FPCs are formed with an objective of enhancing and improving the income of the farmers based on the
principle of aggregation. A farmer becomes a member of the FPC anticipating that he will get the appropriate
support from the FPCs. However, despite all the efforts, FPCs are unable to deliver the expected outcome
as they are marred by various issues and challenges which have been listed below.
16
zz Poor professional management due to their financial and organisational inability to have competent
CEOs and other professionals to manage FPCs.
zz Lack of technical, business and managerial skills in members to build and operate FPCs.
zz Lack of vision and direction from promoters and BoDs.
zz Low equity base due to low share value resulting in dependence on funds/grants from outside.
zz Weak credit linkages of FPCs even after receiving support for promoting the organisation.
zz Inability to attract capital or credit from outside due to poor financial climate from banks and promoters/
directors being unable to comply with the legal requirements to access finance.
zz Low awareness of the bankers on FPC concept.
zz Except for NABKISAN, no other commercial bank, cooperative bank or RRB has designed a loan
product specifically for FPCs and no such loan policy has been formulated at the corporate level to
finance FPCs.
zz Lack of support from external stakeholders like government, donors or private sector.
zz FPCs sometime choose their activity portfolio without considering their member centrality.
zz The negative experience of modern retailers with producer companies and vice versa. Modern retailers
have not shown enough trust and patience while dealing with FPCs as they fail to understand social
dynamics.
zz Challenges in the delivery of quality product in the required time frame.
zz Every FPC is answerable to their members and it becomes very difficult for the board of FPC to face
their members in the absence of any loan, input purchase etc.

This study has been conducted, to understand the problems, assess the capabilities and gaps, map the
possibilities and suggest the best strategy to build the capacity for future operations. It would also help in
bringing out variation in capacities and vulnerabilities of FPCs from the point of view of various parameters
such as demography, organisation, strategy, services, governance, marketing, operations, financials and
impacts

1.4. Objective of the Study

The core objective of the study is to devise state-level action for the better and efficient management of the
FPCs, based on the assessment and categorisation of the same. The specific objectives of the study are.

zz To assess the status of FPCs in Maharashtra, based on various parameters such as governance,
organisation & administration, strategy, marketing, operations, finance, services, impacts among others.
zz To develop an assessment tool and categorise FPCs based on an assessment done.
zz To design a state-level action plan for different categories of FPCs as obtained.
1.5. Approach and Methodology
The following section provides the methodology used in the preparation of this report and tool. This
assessment report is based on a survey of 131 FPCs in 21 districts of Maharashtra.

1.5.1. Secondary Research

Secondary research and desk review were done to understand the mechanism of FPCs in the national
and state-level context. The general idea of FPC’s functioning, the aim of its formation, its role in the
farmer’s development and growth, guiding principles etc. were reviewed.

1.5.2. Data Collection

The questionnaire was developed to conduct the primary research, keeping in mind the objectives of the
project. Stratified Random Sampling method was chosen for conducting the survey of FPCs. Districts of
17
 Maharashtra were taken as the strata for collecting as many variations as possible in the FPCs. Sample
FPCs were selected randomly from 21 districts. Only those FPCs that completed at least one year after
registration were selected for survey. The survey was conducted by the field enumerators in the supervision
of field supervisors. After the Data collection, the cleaning of data was done to remove redundancy. The
data was entered in various analysis tools like SPSS and R.

1.6. Analysis & Report Writing

After the data cleaning and processing, analysis was conducted and following segments were created

1.6.1. Collective Profiling of FPCs

In this section, the collective profiling of FPCs were done on the basis of various parameters. This includes
the category-wise collective analysis of the 131 FPCs surveyed in the state. The broad picture of the FPCs
were drawn considering their memberships, marketing, governance and service among others.

1.6.2. Scoring, Ranking and Categorisation of FPCs

Relevant parameters were selected and categorised into five broad categories or groups. Comparative
weightage to each of the parameters were defined. The more weightage were given to the parameters
which caused the overall growth of the FPC in financial terms and farmers welfare. The values in each of
the parameters were normalised, to percentile and scores were given from 1 to 5 using the 5 iso-quantile
methods. Summation of scores of all the parameters were done.

After the summation of scores, the ranking of the FPCs were done. FPCs having the highest cumulative
score got the rank one and so forth.

Following the ranking, categorisation of FPCs were done. It was based on the scores that the well
performance in parameters groups were separated. For instance, the category A is formed of the FPCs
who have top ranks in the cumulative as well as performed well in at least two of the parameter categories.
Similarly, the category B was comprised of the FPCs who had next best score as well as performed best
in at least one of the parameter categories. Rest of the FPCs were grouped in category C.

After categorisation of the FPCs, general characteristics of each category were described to provide the
broader idea about the general features of each category A, B and C.

1.6.3. Co-relational and Descriptive Analysis

Correlation and descriptive analysis of each of the category were done with various parameters individually,
using the cross-tabulation. This was done to capture the various features of the FPCs that were falling
in those categories. At large, it enabled us to see the broader scenario of performance and outcome of
each of the category of the FPCs. Also, it provided the performance and outcome of FPCs at various
parameters, at the micro-level.

1.6.4. Strategic Action Plan

Based on the information gathered during the primary survey, collective profiling, scoring, ranking
&categorisation of FPCs and descriptive analysis, a strategic action plan was developed for all the three
categories of FPCs. The diagrammatic flow of approach and methodology is given below:

18
 Secondary Research and Desk Review

Survey Tools development & Sampling

Field Survey & Data Collection

Data Cleaning

Analysis and Report Writing

Collective Profiling of FPCs Scoring & Ranking of FPCs

Categorisation

Correlation and Descriptive analysis

Strategic Action Plan of each category of FPCs

19
 Chapter 2

Profiling of FPCs

20
2. PROFILING OF FPCs
2.1. District-wise Spread of FPCs Assessed
There are 1368 registered FPCs in the state, as per the records of Department of Agriculture, Government
of Maharashtra. Assessment of 131 FPCs located in 21 districts were done. The highest number of FPCs
were covered in Nashik whereas lowest were covered in Nagpur.

District-wise FPCs assessed

7
Nandurbar
8 6 1
Dhule Jalgoan 6 Nagpur
Wardha
19
5
Nashik 4 5
Yavatmal
Aurangabad 6 Chandrapur
2 3
Palghar 6 Jalna Hingoli
5
Ahmednagr
2 Parbhani
Beed 5
3 Nanded
Pune 15
Latur
7 13
Osmanabad
Solapur

Kolhapur
4

After the assessment, basic profiling and categorisation were done to understand the characteristics
of FPCs in general. The collective characteristics of FPCs are described below, highlighted by various
indicators.

2.2. Support Agencies & Resource Institution

Various agencies implement the concept of FPC and support them to become a full-fledged business
generating entity. The ownership of the FPC, however, remains with the members.

SFAC, NABARD, government departments, corporates and domestic & international aid agencies provide
financial support or technical support or both to the Producer Organisation Promoting Institution (POPI)
for promotion and hand-holding of the FPC. However, each agency has its own criteria for selecting the
project/promoting institution to support. The major support agencies and their roles are described below.

Small Farmer Agribusiness Consortium (SFAC) is mandated by the Department of Agriculture

Cooperation & Farmers Welfare, India to support the state governments in the formation of FPCs. SFAC
provides two types of financial support to the FPCs. First, SFAC operates a Credit Guarantee Fund
Scheme, to mitigate credit risks of financial institutions which lend to the FPC without collateral. This helps
the FPCs to avail credit from mainstream financial institutions for establishing and operating businesses.
Second, SFAC provides matching equity grant upto Rs. 10 lakhs to the FPCs, to enhance borrowing
power and thus, enables the entities to access bank finance.
21
 National Bank for Agriculture & Rural Development (NABARD) has a Producer Organisation
Development and Upliftment Corpus (PRODUCE) fund for the promotion of FPOs (Cooperatives, FPCs
and Companies). The broad objective of the fund is to promote and nurture FPOs by way of extending the
required financial & non-financial support during the nascent/ formative stage.

NABARD provides financial support to the FPO or FPC only through project mode through two financial
products. NABARD lends to Producer Organisations (POs) for contribution towards shared capital on
matching basis (1:1 ratio), without any collateral, to enable the PO to access higher credit from banks.
NABARD also provides credit support against collateral security for business operations as well as the
credit support without collateral security for business operations, to FPCs which are eligible under the
Credit Guarantee Scheme (CGS).

Besides, the financial assistance, NABARD also provides technical, managerial and financial support for
hand-holding, capacity building and market intervention efforts of the FPO. Such support is available in the
form of grants, loans, or a combination of the two based on the need of the situation and is available only
to those FPOs which avail credit from NABARD.

In the chart below the share of various support agencies in the FPC formation and promotion in the state
are depicted. The major support agencies of the 131 assessed FPCs in state are MACP, followed by
NABARD and SFAC.

2% 5% MACP
3%
Share of Support Agency

4% NABARD

10% SFAC

JFPR
54%
Self
22%
ATMA

Others

2.2.1. Resource Institution & Producer Organisation Promoting Institutions

The various support agencies extend their financial and technical support through Resource Institutions
(RIs) or Producer Organisation Promoting Institutions (POPIs). The following are the key areas of support
by these agencies.

zz Analysing the feasibility of forming FPO in the identified cluster and to help draft a business plan for the
FPC, to share it with the members of Farmer Interest Groups (FIGs).
zz Creating awareness among farmers and motivates them to form FPOs and to undertake Training Need
Assessments (TNAs) of the producers.
zz Assessing infrastructure requirements, market intervention and other support facilities / linkages
necessary for the success of FPCs.
zz Assist in organising capacity building programmes, preparation of business development plan for the
FPCs’ establishment and registration under the appropriate act.
zz Facilitation in credit and market linkage.
zz Provide hand-holding support towards maturity for a minimum period of 3 years.
RI or POPI could be Non-Governmental Organisations, trusts, corporates, state government departments,
NABARD-promoted subsidiaries, Krishi Vigyan Kendra (KVK), big FPCs, farmer federations,commodity
board/federations/exchanges,co-op milk unions and other experienced institution meeting the prescribed
eligibility criteria.
22
The share of various RI or POPI who are supporting these 131 FPCs in the state are depicted in the chart
below. ATMA is supporting maximum number of FPCs assessed, followed by Dilasa and Yuva Mitra.

ATMA
Share of POPIs/Resource

26% Dilasa
Institutions

Yuva Mitra
42%
KVVGPS

18% AFARM

3% 4% 7% Others

2.3. Number of Villages Covered by FPCs

In any FPC, farmers of one or more than one village could become the member. In the chart given below,
the number of villages covered by FPCs are represented.

3%
Number of Villages Covered

24%
Upto 5
by FPCs

> 5 to 10 Villages
42%
> 10 to 50 Villages

31% More than 50 Villages

Among all the 131 FPCs assessed in the state, 24 per cent of the FPCs have coverage up to five villages,
31 per cent of the FPCs have coverage in five to ten villages, 42 per cent of the FPCs have coverage in
ten to fifty villages, and only 3 per cent of the FPCs have coverage in more than fifty villages.

2.4. Memberships
Number of members of any FPCs varies from ten to multiple thousands. In the chart given below, the
distribution of number of members in the assessed FPCs are represented.

5% 3%
9%
Upto 50

> 50 < 100

Memberships

30% > 100 < 500

53% > 500 < 1000

More than 1000

23
 From the above chart, we can see that more than 60 per cent of the FPCs have up to 500 members, about
30 per cent of the assessed FPCs have greater than five hundred and less than one thousand members
and only 9 per cent of the FPCs have more than one thousand members.

2.5. Land Holding Pattern of Member Farmers

The objective of forming the FPC is to support farmers, particularly the marginal and small farmers as
they suffer most in the whole farming community. On an average, 1 per cent of the members are marginal
farmers, 87 per cent are small farmers, 5 per cent are medium farmers, and 5 per cent are large farmers
in the assessed FPCs.

2% 5% 1%
5%
Marginal (Less than 1 Hectare)
Land Holding Pattern of
Member Farmers

Small (1 to 2 Hectares)

Medium (2 to 5 Hectares)

Large (More than 5 Hectares)

Not specified

87%

2.6. Caste of FPCs members

In the chart below, the distribution of caste of FPCs’ members are represented. Among the assessed
FPCs, 63 per cent of the FPCs have more than 50 per cent of SC / ST and OBC members, 2 per cent of
the FPCs have an equal distribution of the SC/ST/OBC and General members.
Caste of Member Farmers

>50 SC/ST & OBC

35%
50 SC/ST/OBC and
50% General

63% 50 General

2%

2.7. Education of CEO/MD

During the assessment, it was observed that few of the FPCs do not have the CEO or MD. From the chart
below, we can see that 76 per cent of the FPCs have CEOs or MDs and the rest of them do not have such
personnel.
24
 CEO/MD in FPC 24%

Yes

No

76%

In the FPCs, where there is a CEO or MD, it is found that 76 per cent of FPCs have the graduate and post
graduate CEOs or MDs. 20 per cent FPCs have CEO or MD who have qualified high school and higher
secondary. In 4 per cent of the FPCs, the CEOs or MDs have education below high school.

4%
Below high school
9%
21%
Education of CEO / MD

High school
11%

Higher secondary

Graduation

55% Post graduation

As mentioned above, 76 per cent of the assessed FPCs have CEOs or MDs. It was also observed that in
47% of FPCs assessed, the CEOs or MDs have between 5 to 10 years of experience. Approximately 43
per cent of FPCs have CEOs or MDs with up to 5 years of experience and about 10 per cent of the FPCs
have CEOs and MDs with more than 10 years of experience.

Less than 1 year

10% 14%
More than 1 to 3 years
Experience of CEO / MD

15% More than 3 to 5 years

More than 5 to 10 years

47%
14%
More than 10 years

25
 2.8. Board Meetings
Board meeting helps the FPCs to plan the business activities and farmer welfare programmes, which is
the goal of the FPCs. In the chart below, the frequency of board meetings held in the assessed FPCs is
represented.

In most of the FPCs, monthly meetings take place. 21 per cent of FPCs hold quarterly meeting. 4 per cent
of the FPCs are pro-active enough to hold fortnightly board meetings. In most of the FPCs, the minutes of
the board meeting are prepared after the meeting, as represented in the given chart.

Frequency of Board Meeting Minutes of the Meeting

Frequency of Board Meeting and

4%
7% 5%
4%
Minutes of Meetings

21%
21%

68%
68% 95%

Bi-monthly Fortnightly No Yes

Monthly Quarterly
.

2.9. Business Activities

FPCs provide various services to their members to enhance the production and marketing of their produce.
In the chart given below, the business activities extended by the FPCs are represented. The FPCs does
not provide all the activities but a combination of activities from the pool of all the activities are executed.
Most of the FPCs provide agri-output marketing, extension support & advisory and agri-input sales.

140
120
38
Number of FPCs

48
100 67
77
80
Business Activities Provided by FPC

93
99 90
60 83
40 110
64
41 54 129 129
20 32
21
0 2 2
Extension Support & Advisory

Agri Service Support

Agri Service Sales

Agri Output Marketing

Infrastruture Rental

Primary Value Addition

Food Processing

Credit to Members

Insurance to Members

No Yes

Among the assessed FPCs, three FPCs provide credit services, to their members. One of those FPC
provides both insurance and credit services while the remaining two FPCs provide either insurance or the
credit service. A brief description of those FPCs are given in annexure 1.

26
2.10. Members Participation
The number of members who participated in the activities conducted by the FPCs are given below in the
chart. The substantial number of member participation represents effective marketing activities and FPC’s
participatory and business-oriented approach. Also, it means the better returns of the farmer’s produce.

Upto 100 members

28%
Members Participated

29%
> 100 to 500 members

> 500 to 1000 members

3%
3%
More than 1000 members

37%
No marketing activity

It has been observed that many of the FPCs (29 per cent) are not conducting any such activity for the
participation of the members. There are 28 per cent FPCs, which have a participation of less than 100
members in the activities conducted by the FPCs and 37 per cent FPCs have witnessed participation of
100 to 500 members in the activities conducted by them. 3 per cent of the FPCs reported that the member
participation was more than 1000 in the marketing activities conducted by them. It highlights that there
is huge scope for increasing members’ active participation in various marketing activities of the member
farmers and therefore, the opportunity of increasing the business prospects for the FPC.

2.11. Number of Equity Shareholder

Generally, the strength of equity shareholder represents the financial capability of any FPCs. An equity
shareholder has more sense of association with the FPCs and he or she is more orientated towards the
business objective of the FPCs. Hence, the number of members who are equity shareholder in the FPCs
denotes the capital resources, turnover and other financial subjects of the FPCs. In the chart below the
number of equity shareholder in the assessed FPCs are represented.

4%
8%
Number of Equity Share Holders

5% Upto 50

> 50 to 100
31%

> 100 to 500

> 500 to 1000

52%

More than 1000

52% of the FPCs have greater than 100 but less than 500 equity shareholders. Only 4% of the FPCs have
equity shareholders more than 1000.

27
 2.12. Annual Turnover & Net Profit
Annual turnover is another indicator to judge the financial capability of any FPC. In the chart given below,
the annual turnover of the FPCs assessed during the study is represented.

Almost a quarter of FPCs have not been able to mention their turnover. There are 28 per cent FPCs, which
have a turnover of less than INR 10.00 lakhs and another 22 per cent have a turnover of INR 10.00 - 50.00
lakhs. Only 13 per cent of the FPCs have more than INR 1 crore of the annual turnover. 26 per cent of the
FPCs have not been able to specify their annual turnover.

26% Upto 10 Lakhs

28%
Annual Turn Over

More than 10 Lakhs to

50 Lakhs

More than 50 Lakhs to

13% 1 Crore

22% More than 1 Crore

11%
Not specified

The net profit scenario of the assessed FPCs is summarised below.

Upto 5 Lakhs

More than 5 Lakhs to 50 Lakhs

Net Profit

45% 44%
More than 1 Crore

Facing Loss

5%
3% 3% Not Specified

In 44 per cent of the FPCs, the net profit is up to 5 lakhs. Only 3 per cent of the FPCs have a net profit of 1
crore. Another 3 per cent of the FPCs have a net profit of INR 5 lakhs to 50 lakhs. 5 per cent of the FPCs
are facing loss and 45 per cent of the assessed FPCs have not been able to specify their net profits.

28
2.13. Annual Audits & Patronage Distribution
Annual audits are the source of credibility of the FPCs. The FPCs are supposed to carry out internal audits
of its accounts at regular intervals in accordance with its articles of association. Such audits should be
carried on by a chartered accountant. In the chart given below, the situation of annual audits of the FPCs
assessed are represented. Although, 71 per cent of the FPCs have got their annual audits done, only 3
per cent of the FPCs were able to distribute the patronage.

Annual Audits Patronage Distribution

3%
Annual Audits

29%

71%

97%

No Yes No Yes

Relation among the general parameters

The general characteristics of the assessed FPCs have been described in the above section. Various sets
of FPCs could be visualised depending on taking various performance and outcome parameters. In the
section below the various characteristics of the sets of FPC are cross-tabulated with the performance and
outcome by taking the averages.

2.14. Education of CEO & Members’ Strength

In the chart below, the relation between the education of CEO/MD in the FPCs and members’ strength of
the FPCs are represented.
Education of CEO and Members’ Strength

900
Average Number of Members

803
800
700
600 550
489
500 436
400 342 318
300
200
100
0
No CEO Below High High School Higher Graduation Post Graduation
School Secondary

Education of CEO

The average number of members is highest in FPCs where CEO / MD is post-graduate. On the other
hand, the same is lowest in case of the FPCs where CEO’s educational qualification is higher secondary.
It is noteworthy to see that the FPCs who do not have CEO/MD have a greater number of members on
29
 average as compared to the FPCs who have CEO/MD with educational qualification below high school
and higher secondary.

2.15. Experience of CEO &Annual Turnover

Except for the CEO/MD with less than one year of experience, the FPCs who have CEO/MD with more
years of experience have higher annual turnover in general. The same is represented in the chart below.
On an average, the FPCs with CEO/MD having more than ten years of experience have the annual
turnover of INR 34 crores per annum. However, the FPCs with CEO/MD having less than one year of
experience have the annual turnover of INR 6 lakhs per annum on an average.

400
340
Average Annual Turnover (in lakhs)

350
Experience of CEO/MD and

300 263
Annual Turnover

250
200
150
100
35 38
50 21 6
0
No CEO Less than One to three Three to five Five to ten More than
one year years years years ten years

Experience of CEO/MD of FPCs

2.16. Number of Villages Covered and Equity Share Holder

In the graph below, the set of FPCs with village coverage are analysed against the number of equity
shareholder.
Average Number of Equity Share Holders

2500
2250
Number of Villages Covered and

2000
Equity Share Holder

1500

1000
694
502
500 342 364

0
0 to 5 6 to 10 11 to 50 51 to 100 More than
100

Number of Villages Covered

From the above graph, it is visible that the number of equity shareholder are increasing with the village
coverage. The highest average number of equity shareholder have been observed in the FPCs who have
more than 100 villages.

30
2.17. Caste and Board Meeting
The graph below represents the relation between the caste profile of the members in the FPCs and board
meeting, to assess the intensity of participation by the various group of caste in the overall functioning of
the FPC.

The highest number of board meetings are observed in the FPCs who have the majority of members
belonging to the general category, followed by FPCs who did not specify the caste profile of the member. The
other FPCs who are more frequent on holding the board meetings are FPCs who have equal distribution of
OBC and general members, followed by FPCs who have the majority of OBC members. The least number
of board meetings are held in the FPCs who have equal distribution of SC / ST & OBC members.
Caste of Members and Board Meetings

350.0
Average Number of Board Meetings

296.3
300.0

250.0

200.0

150.0
108.4
100.0
50.0
50.0 20.5 6.6 1.0
0.0
Mostly Mostly OBC Mostly Mostly OBC Mostly Not
General SC/ST & General SC/ST & OBC Specified

Members’ Caste Profile of FPC

2.18. Land holding and Turnover

The relation between the member’s landholding pattern and annual turnover have been analysed here
and represented in the graph below.

The highest average annual turnover is reflected in the FPCs with mostly marginal farmers, followed by
FPCs with equal distribution of medium and small farmers. The next highest annual turnover are seen in
FPCs with mostly small farmers, followed by FPCs with equal distribution of marginal and large farmers.
The FPCs with mostly medium farmers have the lowest average annual turnover.

250.0
Average Annual Turnover (in lakhs)
Landholding and Annual Turnover

206.2
200.0
175.0

150.0

100.0

50.0 32.3 29.5 30.0

18.2
2.0 4.0
0.0
Marginal Small Medium Large Marginal & Marginal & Medium & Not
Small Large Small Specified

Members' Landholding Profile of FPCs

31
 Chapter 3

Ranking and Categorisation of FPCs

32
3. RANKING AND CATEGORISATION OF FPCs
3.1. Categorisation of FPCs
Farmer Producer Companies (FPCs), which were surveyed under the study have been categorised
based on their respective profile. For categorisation of FPCs, derived parameters have been used. These
parameters have been made from the combination of various primary parameters captured during the
survey. Broadly, five parameters, namely organisational profile, member profile, management profile,
business profile and outcomes have been derived with a combination of various primary parameters,
which have been described in the table below

Categories Parameters
Organisation Number of villages covered, number of members, number of equity shareholders,
Profile growth in number of members (in absolute terms) & FPC in days
Member Profile Land holding Pattern
Management CEO/MD education and CEO/MD experience
Business Profile Activities done by FPCs
Outcome Annual turnover, net profit patronage bonus and member participation

Based on these derived parameters, segmentation of FPCs have been done for the purpose of
categorisation. All the FPCs have been classified into three categories i.e. A, B, and C based on the scores
received for derived parameters. The scoring mechanism was developed by giving higher weightage, to
more relevant parameters and vice versa.

3.2. Scoring Mechanism

The four-layer scoring mechanism is used to give scores to the FPCs, which is described below:

Identification & grouping

of Parameters

Percentile based Normalisation

Scoring (1-5)

Weightage allocation to
derived parameters

Scoring

3.2.1. Identification & Grouping of Parameters

FPC profiling parameters, which had measurable values were identified and clubbed into same groups
for deriving single parameter, which represents the particular characteristic of FPC, e.g. organisational
profile being derived by clubbing the scores of number of villages covered, number of members, number of
equity shareholder, growth in number of members (in absolute terms) & FPC age in days. Similarly, other
parameters such as members profile, management business profile and outcome have been derived (as
explained in table above).
33
 3.2.2. Normalisation of Value to percentile
The value of each of the parameter is normalised into percentile to ensure that each parameter reflects
adequately in the derived parameter.

3.2.3. Marking of Scores

The value of each of the parameter were converted into percentile and each of the quantiles have
been given the score, from one to five, where five is the best. The score marking criteria for each of the
parameter was defined first depending on the nature of the same .Hence, it is not applicable, and the
highest percentile has got the highest score. For example, in case of turnover, higher the turnover higher
is the score but this is reversed in case of land holding pattern where small land holding of FPC members
have been given the highest score.

3.2.4. Allotting Weightage to the Scores

Depending on the nature of the parameter and their role in the overall performance in the FPCs, weightage
was given to derived parameters, to adequately reflect the performance of each FPC.

3.2.5. Summation of Scores

Summation of scores of each parameter of every category was done, followed by a summation of the
cumulative score of each category. With this approach, the final score for each of the FPC have been
derived

3.3. Categorisation of FPCs

Once scoring of each of the FPC was done as per the approach mentioned above, categorisation of FPCs
was also done. For categorisation of the FPC into A, B and C, the following criteria have been taken into
consideration.

The flow chart given below describes the process.

Listing of FPC with scores

Consecutive highest scores + scored best in

Category A
at least two of the parameter categories

Next consecutive highest scores + scored best in

Category B
at least one of the parameter categories

Remaining FPCs Category C

Category-wise number of FPCs

Categories Number of FPCs

A 9
B 42
C 80
Total 131

34
3.4. Characteristics of Categories
Each category of the FPCs have different kind of characteristics based on the organisation profile,
membership base, members’ profile, business activities and business outcome basis. These characteristics
of each category have been described in the following paragraphs. As these characteristics have been
arrived at by taking the average value for a parameter for FPCs in particular category, there are chances
that in some cases the FPC may not exactly fall in same category for single parameter. However, at holistic
level, the nature of FPCs categories remains the same.

3.4.1. Organisational Profile

For determining the characters relating to organisational profile of FPCs of different categories, parameters
such as average number of members, average number of equity shareholder and age of FPCs (in days)
have been considered.

Category-wise Organisational Profile of FPCs

1,200 1,114
1,058
1,000 919 877
800 724
664
600 498
435
375
400
200
-
Average of Number Average of Number of Average of FPC
of Members Equity Share Holder Age in days

A B C

Broadly, FPCs falling under category ‘A’ have a large number of members and shareholders. In
categorisation, there are 919, 664 and 435 average members respectively for category ‘A’, ‘B’ & ‘C’.
Similarly, there are 724, 498 and 375 average shareholder members for the categories of A, B and C
respectively. Therefore, chances are that as number of members and shareholders are growing, FPCs can
have overall better performance. It has also emerged from the analyses that, with the age, performance
of FPC improves.

3.4.2. Membership Profile

Although, there has not been many variations in the membership profile for various categories from the
perspective of land holding sizes, still it has been observed that category A FPCs have a larger number of
marginal farmers (64.22 per cent) compared to category B (52 per cent) and category C.

Percentage of member farmers of different land holding category

C 46.10 31.61 12.99 9.30

B 51.55 26.88 13.14 8.43

A 64.22 21.67 8.00 6.11

Marginal Small Medium Large

35
 Another important aspect of membership profile is the distribution of caste amongst various categories
of FPCs. Two very critical observations have been made here, one that most of the FPCs have good
representation of all the caste members and second, FPCs with homogenous social background are
better performing.

Category-wise caste profile of members in FPCs

C 31.67 37.67 30.66

B 23.44 25.83 50.73

A 13.90 27.18 58.92

SC / ST Members OBC Members General Members

3.4.3. Business Activities

From the perspective of diverse business activities to be undertaken by the FPCs, category A FPCs have
maximum diversity with seven different types of business activities/services being performed by each FPC.
Comparatively, category B FPCs have undertaken five types of business activities, while category C FPCs
have undertaken only two types of business activities. This shows that the FPCs, which are performing
better, have multiple business options and are serving their member farmers in a different manner.

Category-wise average number of business activities undertaken

7
7
6
5 5

4
3
2
2
1
-
A B C

The above mentioned characteristics are mainly based on the profile of the FPCs surveyed. There are
other parameters, which are more related to approach towards various internal and external factors, which
defines specific FPCs categories. These specific characteristics have been mentioned in the following
table.

Category A Category B Category C

Formal campaign for promoting Existing members are Largely these FPCs do not
membership. encouraged to remain member have formal campaign for
and add more members. membership promotion.
Meetings of Board of Directors Meetings of Board of Directors Many FPCs in this category do
are conducted on regular basis are conducted on regular basis not conduct regular meetings,
with active participation of with active participation of also there is relatively less
members. members. active participation of directors.

36
 Category A Category B Category C
AGM is conducted every year AGM is conducted every year, For most of the FPCs,
with good number of members however, many of the FPCs of attendance of members in AGM
participating in the meeting. this category sees less than 50 is scanty.
per cent members’ participation
in the meeting.
About 80 per cent of members in For most of the FPCs, 25 per Less than 50 per cent of
most of the FPCs of this category cent– 80 per cent members members avail services
avail services provided by the avail various services. provided by FPCs in maximum
FPC. number of FPCs of this
category.
FPCs support its members Procurement is facilitated but Lesser involvement in
in marketing and has set-up not on regular basis. facilitation of marketing and
marketing intelligence and price information dissemination.
procurement system.
This category of FPCs have Some of the FPCs have Mostly do not use any
also started creating its own created infrastructure, but infrastructure for business
infrastructure for business there are many FPCs without operation.
purposes. infrastructure.
Some of the FPCs in this FPCs are mainly involved in Most of the FPCs are not
category have started branding primary value addition of sorting involved in any kind of value
their product, in addition to value & grading. addition.
addition of grading, sorting,
processing and packaging.
These FPCs have deployed These FPCs also have paid Most of the C Category FPCs
services of accountant as well as accountants and agencies do not have their own paid
getting accounts audited through for audit, however, rarely accountants.
external agencies and results are any results are shared with
shared with shareholders. shareholders.
Good record keeping. Good record keeping. Record keeping is poor.
Mostly using at least one MIS Many of the FPCs have used Most of the FPCs do not know
software application. MIS software, but still there are of any MIS software, however
many who have not used. some of the FPCs are aware of
such application.
Overall good understanding of Average understanding Relatively poor understanding
business, wherein CEO / BoD business operations and of the business activities.
members are aware of things services to be provided to the
such as availing credit facility, member farmers.
initiating agri-input trading or
output marketing or any other
services to members.

Correlation of some of these characteristics of different categories (A, B & C) with various internal and
external factors and impact of different categories of FPCs created by each category on its respective
members / shareholders have been discussed in the following chapters. This analysis has further been
used in devising customised action plan and strategy for each category.

37
 Chapter 4

Correlation Analysis of
Different Categories

38
4. CORRELATION ANALYSIS FOR DIFFERENT CATEGORIES
4.1. Correlation Assessment
As it has been described in the previous chapter, all the FPCs have been categorised into three major
categories of A, B & C. The categorisation is mainly based on analysis of parameters and scoring, which is
the combined outcome of profile as well as output of the FPCs. This chapter basically analyse correlation
of various factors, efforts and approaches influencing the category of an FPC. Also, the correlation
between different categories and other factors will also help us in devising the suitable strategy for different
categories of FPCs.

The factors, which are related to Governance, Management, Memberships, Marketing, Business & Finance
etc. had been analysed in context of categories of FPCs for assessing the correlation.

4.2. Memberships and Governance

Since the motive of the FPCs formation is to benefit the broader spectrum of the farmers through
collectivisation, the member strength of the FPCs plays a vital role in the outcome of the same. Effective
FPCs follow various strategies to associate more members with them. Similarly, better governance, which
includes the board meeting, annual general meetings, feedback collection process etc. results in better
communication among the management personnel and leads to better strategy formulation. It also fosters
the sense of ownership and responsibility among the members. In the section below, the differentiation
of FPC categories have been done to visualise the effects of the membership strategies and governance
practices on them.

4.2.1. Membership Campaign Strength

It is observed from the chart below that the FPCs falling in the category A have stringent membership
campaign mechanism in place. In category A FPCs, 75 per cent have conducted formal membership
activities. On the other hand, only 39 per cent of the FPCs falling in the category B have conducted a
formal campaign which goes further down in the case of FPCs in category C, where only 31 per cent of the
FPCs have conducted such activities. This infers that the FPCs who have better membership strategies
falling in category A followed by the category B.

C 10% 32% 27% 23% 8%

B 2% 21% 38% 14% 25%

Membership Campaign Strength

A 12% 13% 25% 50%

No formal membership campaign or Informal efforts

Once formal membership campaign but not capable

No ongoing formal membership campaign but existing members are encouraged

Formal membership campaign but activity-wise breakup not made

Clearly articulated membership campaign with annual activities, promotional materials & incentives

39
 4.2.2. Board Meeting
The regularity of board meeting and participation of members in the board meetings are highest in the
FPCs of category A, as seen in the given chart. More than 63 per cent of the FPCs in category A have
conducted the board meetings regularly, with satisfactory participation and active members. The FPCs of
category B are little less regular compared to category A and the members are comparatively less active.
However, few of the FPCs in category C are seen as irregular in conducting the board meeting and weaker
in the members’ participation.

C 4% 10% 15% 36% 35%

B 43% 57%
Board meetings

37% 63%
A

No formal board meetings conducted

Board meetings conductied, but not regular
Meetings Conducted regularly, participation is minimal
Meetings conducted, participation is satisfactory, but few active members
Meeting conducted, participation is satisfactory, members are active

4.2.3. Annual General Meeting

All the FPCs in category A have conducted the AGM, out of which 45 per cent of the FPCs have published
the formal agenda and distributed the minutes of meetings to the members and non-members. In category
B, the share of FPCs who have conducted AGM with formal agenda is 85 per cent but the distribution of
the minutes to the attending and non-attending members is just 14 per cent out of all the FPCs. In contrast
with category A and B, only 55 per cent of the FPCs in category C have conducted AGM with formal
agenda while 1 per cent of the FPCs have distributed the minutes to the attending and non-attending
members. So far, 21 per cent of the FPCs in category C have not conducted any AGM.

C 21% 24% 26% 28% 1%

B 15% 26% 45% 14%

Annual General Meetings

A 11% 22% 22% 45%

No AGM in last two years

AGMs conducted, does not have formal agenda

AGM has published agenda, but doesn't reflect matters for discussion, minutes not distributed

AGM has formal agenda, distributed minutes to attending members, but not to non-attending members

AGM has formal agenda, distributed minutes to attending and non-attending members

40
4.2.4. Use of FPC Services by Members
In category A, the share of FPCs where more than 80 per cent of the member used at least one of the
various services provided by FPCs is 45 per cent. The share of same goes down to 26 per cent in category
B and gets furthermore down to 8 per cent in category C. This infers that the number of beneficiaries would
be highest in the category A of the FPCs as compared to category B and category C.

C 16% 26% 31% 19% 8%

Use of FPC Service by Members

B 2% 12% 24% 36% 26%

A 11% 33% 11% 45%

No member used FPC services in last year, no record maintained

< 25% of members used FPC services in the last year, no proper record to measure participation
Between 25 -50% of members used at least one FPC service in the last year
50% to 80% of members used at least one FPC service in the last year
Over 80% of members used at least one FPC service in the last year

4.3. Finance Management

The effective performance and management of FPCs results into better outcomes in the form of
improvement in the farmers revenues as well as the profitability of the FPCs. Likewise, management and
marketing, the financial and account management are equally needed, as the same lead to better planning
and utilisation of the monetary resources. It is found that the best performing FPCs perform the required
account and finance related activities and to keep all the records well.

4.3.1. Accountant in FPCs

In the category A, 45 per cent of the FPCs have the paid accountant with an accurate job description and
clear responsibilities whereas, in category B, only 19 per cent of the FPCs have paid an accountant with
an accurate job description and clear responsibilities. But none of the FPCs in category C have paid an
accountant. Also, in category A, the share of FPCs who have not paid the accountant is 22 per cent, which
goes as high as 43 per cent in category B and 88 per cent in category C.

88% 2% 6%
C 4%

B 43% 9% 5% 24% 19%

Accountant in FPCs

A
22% 11% 22% 45%

No paid accountant
Paid accountant, but no job description & no clear list of responsibilities
Paid accountant with a rudimentary job description and responsibilities
Paid accountant with accurate job description but no clear list of responsibilities
Paid accountant with an accurate job description and clear responsibilities

41
 4.3.2. External Audits
The external audits of all the FPCs in category A were done. The audits in 67 per cent of the FPCs in
category A were done by the registered external auditor and results were shared with the members. The
external audits in category B were done in 71 per cent of the FPCs, while the auditing of 35 per cent of
the FPCs were done by the registered external auditor and results were shared with the members. In the
category C, external audits were done in the 65 per cent of the FPCs, but only 31 per cent of the FPCs
have got their audits done by registered external auditor and shared the details with members.

26% 9% 9% 25% 31%

C

B 17% 12% 12% 24% 35%

External Audits

A 11% 22% 67%

No external audit done so far

Basic inspection audit completed

Audits conducted but irregularly

Audits conducted annually, but final results not shared with members

Annual audit conducted by a registered external auditor, results shared with members

4.3.3. Balance Sheet

In category A, all the FPCs have reconciled balance sheets, however, the share of FPCs in category B and
category C who have reconciled balance sheets is 98 per cent and 84 per cent respectively.

C 6% 6% 4% 49% 35%

B 2% 50% 48%
Balance Sheets

A 44% 56%

No clear idea about balance sheet and its importance

No balance sheet, no separate listings of assets, liabilities and equities

No balance sheet, but separate listings of assets, liabilities and equities, but not reconciled

Reconciled balance sheet, detailed schedule for each line item, but no amortisation, depreciation or equity payment

Reconciled balance sheet, detailed schedule for each line item, there is amortisation, depreciation & equity payment

42
4.3.4. Record Keeping
Around 56 per cent of the FPCs in category A have safe, current, legible master list of the record books in
adequate internal controls. But, the share of such FPCs is only 31 per cent in category B and 15 per cent
in category C. Inversely, the share of FPCs which do not have any kind of master list at all is 11 per cent in
category A, 10 per cent in category B and 41 per cent in category C. The observation hence concludes that
the FPCs falling in the category C have the weaker record keeping capacities as compared to the FPCs
in the category A and category B.

C 41% 10% 4% 30% 15%

B 10% 2%5% 52% 31%

Record Keeping

A 11% 11% 22% 56%

There is no master list of all record books

All record books not maintained in a safe location to reduce loss to theft or conditions
Master list of all record books, in safe location, but most records not updated or legible
Master list of all record books, they are maintained in a safe location and they are current and legible
Master list of all record books; they are safe, current and legible; and in adequate internal controls

4.3.5. Access to Credit

In category A the share of FPCs who have acquired a loan and reimbursed at least one loan on time is 44
per cent. While the share of such in category B and category C are 9 per cent and 2 per cent respectively.
Also, the share of FPCs who do not know how to avail loan is nil in category A, 5 per cent in category B and
18 per cent in category C. These facts indicate that the FPCs in the category A are well capable of availing
and repaying the loan. However, the FPCs in category C are the least capable of availing and repaying the
loan among all the FPCs assessed.

C 18% 51% 18% 11% 2%

B 5% 29% 17% 40% 9%

A
Access to Credit

34% 22% 44%

FPC doesn't know how to take loans or FPC not in stage to avail loan
FPC knows how to apply for loan but has not applied yet
FPC has applied for loan but could not get it due to lack of collateral, credit worthiness,
documentation etc
FPC has already got the loan at least once
FPC has already got the loan and repaid at least one loan in timely manner

43
 4.3.6. Profitability
The share of FPCs who are unprofitable or not able to determine their profitability is 11 per cent in category
A, 19 per cent in category B and 61 per cent in category C. Inversely, share of FPCs who are able to
demonstrate their profitability since its formation is 11 per cent in category A and 2 per cent in the category
B and nil in category C.

C 60% 19% 8% 13%

B 19% 48% 19% 12% 2%

A
Profitability

11% 22% 45% 11% 11%

Unprofitable or unable to determine if they are profitable

Able to demonstrate just one profitable year in the last three years
Able to demonstrate profitability twice in last three years
Demonstrated profitability in all the last three years
FPC has consistently demonstrated profitability since its formation

4.4. Management
Being an organisation, FPCs needs certain managerial skills and expertise to be operated as a profitable
entity. Various aspects like education and expertise of CEO, member participation in business planning,
data collection and management, awareness of schemes among others affects the overall management
of the FPCs and ultimately the outcome. In the section below the managerial capabilities of each of the
categories are discussed, which will reveal the managerial efficacy of the FPCs category-wise.

4.4.1. CEO/Manager in FPCs

Around 44 per cent of the FPCs falling in category A has paid CEO or managers with an accurate job
description separate from the board’s responsibilities & who receive feedback. In category B, the share of
the FPCs with the availability of paid CEO or manager is 19 per cent while in category C the share is 15
per cent. It is also remarkable to see that in category A, only 12 per cent of the FPCs have no paid CEO or
managers, whereas in category B the share of such FPCs goes little higher to 17 per cent and far higher
to 39 per cent in category C.

C 39% 10% 11% 25% 15%

B 17% 10% 14% 40% 19%

CEO & Managers in FPCs

A 12% 11% 11% 22% 44%

No paid CEO/Manager
Paid CEO/Manager selected by promoting institution but not consulting board, no job description
Paid CEO/Manager selected by the board, no job description separate from board’s responsibilities
Paid CEO/ manager with accurate job description, separate from board’s responsibilities
Paid CEO/ manager with accurate job description separate from the board’s responsibilities & receive feedback

44
4.4.2. Business Plan Preparation
In category A, 22 per cent of the FPCs consistently use the business plan to define the FPC action,
evaluate the progress and report to the members and board; the share of such FPCs is just 10 per cent in
category B and only 5 per cent in category C.

C 16% 12% 54% 13% 5%

B 10% 10% 33% 37% 10%

Business Plan Preparation

A 11% 23% 22% 22% 22%

FPC has no clear idea about preparation of business plan and need of it

FPC knows the importance of business plan but there is no documented business plan

There is a business plan, but it is neither current nor used by FPC

Business plan is regularly used to define FPC actions

Business plan is regularly used to define FPC actions, progress is evaluated and reported
to members and board

4.4.3. Standard Operating Procedures (SOPs)

Almost 60 per cent of the FPCs falling in category C have no Standard Operating Procedures or SOPs,
whereas category B has around 31 per cent of such FPCs and category A has no such FPCs. However,
44 per cent of the FPCs in category A have documented and accessible SOPs with sampling procedure.

4%
C 60% 21% 11% 4%
Standard Operating Procedures (SOPs)

B 31% 38% 7% 10% 14%

A 34% 22% 22% 22%

There are no SOPs

There are SOPs but they are not documented

There are documented SOPs, but does not cover all areas, not followed or not readily accessible by staff & members

There are documented & accessible SOPs with a sampling of procedures that followed accordingly

There are documented, accessible & adhered policies with routine inspection & updating of procedures

45
 4.4.4. Use of Management Information System (MIS) Software
It is noteworthy that 78 per cent of the FPCs in the category A are using at least one Management
Information System or MIS software, which is only 43 per cent in category B and only 19 per cent in
category C. Also, there are no FPCs in category A who are not aware about the advance software or MIS
system. However, there are around 17 per cent of the FPCs in category B and 38 per cent in category C,
who are not aware about the advance software or MIS system at all.

C 38% 17% 9% 17% 19%

B 17% 19% 9% 12% 43%

Use of MIS software

A 11% 11% 78%

Does not know about advance software/MIS system

Aware of such software but has not thought about using such software
Wants to use but not aware of which software could be useful
Planning to use certain software but have not yet started
Already using at least one such software

4.4.5. Awareness about Schemes

There is drastic difference in the level of awareness about schemes and capacity, to avail benefits among
the categories. Around 89 per cent of the FPCs falling in category A are aware, applied and have benefitted
from at least one scheme. However, the share of such FPCs goes down to 62 per cent in category B and
further lowers to 48 per cent in category C.

12% 14% 14% 12% 48%

C

B 5% 7% 9% 17% 62%
Awareness about Scheme

A
11% 89%

Not aware of any schemes for FPCs

Knows about some schemes, but don't know how to apply

Know how to apply, but haven't applied yet

Have applied, but not benefitted from any scheme

Have applied, benefitted from at least one scheme

46
4.5. Marketing
Traditionally, farmers are linked to commission agents who market their produce through open auctions
in the regulated agriculture markets or they sell through local aggregators and traders. With the advent of
FPCs, aggregation of the produce of member farmers and collective marketing of their produce have been
made possible. One of the most important objectives of forming an FPC is to aggregate and collectively
market the products of the farmers. Since, the main objective of the FPCs is to earn profit, they are
expected to have dedicated marketing personnel, develop infrastructure for cleaning, sorting, grading
&packaging and direct linkages with food processing industries or retail chains. Aggregation and collective
marketing involves activities like determining pricing mechanism, primary value addition, market surveys,
consumer feedback mechanism, certification and trading through commodity exchanges. The study has
assessed the activities associated with the marketing of produce of the members.

4.5.1. Marketing Services to Members

Facilitating the marketing of produce of members has emerged as one of the critical business activities
for FPCs. Better performing FPCs have gone further and procured from non-member farmers too. Thus,
providing all-around benefits to the farmer community in the region of operations. However, many FPCs
have failed, to realise this role and instead remained just input suppliers. The study tries to compare the
services being provided by identified categories of FPCs.

From the category A 56 per cent FPCs procured produce from the member farmers and also possessed
market intelligence system while only 19 per cent and 1 per cent of FPCs from category B and category
C respectively did the same.

Majority of better-performing FPCs in category A hired dedicated personnel for marketing functions, unlike
in case of category B and C wherein the marginal number of FPCs hired some dedicated personnel for
marketing functions.

C 28% 18% 47% 6% 1%

B 5% 7% 33% 36% 19%

Marketing Services to Members

A 22% 22% 56%

No role in marketing member’s produce

FPC guides members for marketing, but does not take responsibility

FPC take responsibility of sale but not on regular basis, does not refer to rates before selling

FPC procures produce from member regularly, always refers to rates

FPC procures produce from members regularly, always refers to rates, has market intelligence system

4.5.2. Use of Infrastructure

Farmers at the individual level do not possess the financial strength, to set up value addition infrastructures
like warehousing, primary processing and packaging units. Thus, they are left with no choice but to sell
47
 their produce through traditional supply chains and are unable to realise better prices for their produce.
One of the important aspects of the formation of FPCs was to organise marginal and small farmers, who
are unable to invest in agriculture, into a group for commercial interests. With pooled financial resources
and government support, they would be able to compete with larger farmers through technology and
infrastructure interventions. During the survey, information on the use of infrastructure by the members
was solicited, to determine the success of FPCs in this aspect of the agribusiness.

C 56% 26% 8% 6% 4%

B 21% 10% 21% 14% 34%

Use of Infrastructure

A
11% 22% 11% 56%

Never used/does not have any infrastructure

Rarely/once in a while used
Regularly used but less than 25% capacity utilisation
Regularly used with 25%-50% capacity utilisation
Regularly used with more than 50% capacity utilisation

Members of at least 56 per cent of the FPCs in category A were found to be using the infrastructure
regularly with more than 50 per cent capacity utilisation compared, to FPCs in other categories. In FPCs
in category B this number dropped to 34 per cent and in category C this number further dropped to 4 per
cent. Another striking difference that has been observed was that 56 per cent of the FPCs from category
C does not have any infrastructure services for its members.

4.5.3. Pricing Mechanism

The pricing mechanism for the procurement of produce from the members have a major impact on the
perception of the members on the functioning of the FPCs. A fixed pricing method is expected, to build
trust among the members. Determination of pricing method through consultation with the members infuses
transparency in the system and further builds the trust. The success of the FPCs is dependent on the
compliance of the members which is strengthened through building trust with the members. Thus, the
determination of pricing mechanism plays an important role in building long-lasting partnerships between
members and the FPC.

C 67% 9% 4% 12% 8%

B 43% 9% 5% 19% 24%

Pricing Mechanism

A 22% 11% 22% 45%

No fixed pricing method & procedure opted by FPC

FPC is planning to make a fixed pricing policy
FPC has fixed pricing mechanism, but farmers or leaders don’t know about this
Fixed method for calculatinf price, calculating together by FPC & few producer members
Fixed method for calculatinf price, calculating together by FPC & few farmer member in transparent

It has been observed that majority of FPCs (43 per cent in category B and 67 per cent in category C) were
found not to have fixed pricing or procedure. On the contrary, 78 per cent of the better-performing FPCs
48
(category A) were found to have fixed the pricing mechanism. Furthermore, 45 per cent of the FPCs in
category A determined the pricing mechanism in a transparent manner through consultation with member
farmers while this number was 24 per cent in category B and just 8 per cent in category C.

4.5.4. Value Addition

Value addition of produce may happen through cleaning, sorting, and grading which is called primary
processing. Even just packaging, branding and marketing add value, to the product. On the other hand,
secondary processing involves converting raw material into a finished product that is directly consumed
by the consumer. As the product moves through the value chain, which is the progression of product from
raw material to a finished product, the price of the product increases and the price realisation of the farmer
in the final product decreases. Therefore, it makes perfect business sense for the farmers to advance in
the value chain and take up value addition. However, farmers lack resources to take up such processing
and make matters worse by processing small quantities of produce from marginal and small land holding
farmers. This is where FPCs play an important role in pooling resources of these small and marginal
farmers while acting as a platform, to aggregate their produce and to take up value addition activities. The
government gives preference to FPCs in the implementation of its schemes as a matter of policy.

C 57% 35% 2% 4%
2%

B 14% 29% 19% 17% 21%

A
11% 22% 33% 56%
Value Addition

FPC is not involved in any type of value addition

FPC does basic grading but no processing and/or packaging

FPC does grading/processing but rudimentary or no packaging done

FPC involved in grading, packaging but no branding of their produce

FPC involved in grading, packaging , and branding of their products

It was observed from the survey that more FPCs in category ‘A’ were involved in value addition than in
either of the other two categories. In other words, 89 per cent of FPCs in category ‘A’ were involved in
value addition activities while only 38 per cent in category ‘B’ and 6 per cent in category ‘C’ were involved
in value addition activities. Thus, in terms of evolution from just aggregation, to value addition, more of the
FPCs in category ‘A’ were found to be evolved as compared to category ‘B’ and category ‘C’.

4.6. Services Provided by FPCs

FPCs registered under Companies Act, 2013 are free to take up commercial activities. They are also
protected from government interference which is not the case in other farmer organisations like cooperatives.

4.6.1. Financial Services

Financial services by FPCs may include providing help to members, to get loans from financial institutions.
These loans may be required by farmers to buy agri-inputs, financing purchase of livestock or inputs for
other agri-allied activities and related loans.

Majority of FPCs in all three categories were found to be not helpful for the members,to get loans from
financial institutions. This may be the case because providing agriculture credit, to farmers requires formal
institutional arrangement, regulatory compliances and other requirements which most of the FPCs may
not be ready for as yet. However, an information gap among the FPCs from category B and C, can be
49
 seen as 27 per cent of FPCs in category C and 17 per cent of FPCs in category B are not aware that they
can provide such services. On the other hand, majority of FPCs in each category are aware but they do
not provide such services.

C 27% 29% 35% 6%3%

B 17% 12% 54% 5% 12%

Financial Services

A 11% 45% 11% 33%

11%

FPC does not know that it can provide such service to its members
FPC does not know how to get loan for its members
FPC knows how to get loan for farmers, but has not provided any facilitation to members
FPC is trying & planning to help members in getting loan from other financial institutions
FPC has helped member farmers in getting loans for one or other services

4.6.2. Input Supply

Formation of FPCs provides an opportunity to the farmers to procure large quantities of agri-inputs at
wholesale rates and distribute these inputs at lower then market prices through the FPCs. In case of
FPCs from category A, a majority of FPCs (67 per cent) bought physical inputs and distributed, to member
farmers which is not the case for FPCs in other categories. In the category B, only 36 per cent bought
agri-inputs and distributed to the members. While the numbers for the same in category C remains at 26
per cent.

C 10% 9% 50% 26% 5%

2% 36% 36% 21%

B 5%

A 33% 67%
Input Supply

FPC does not know how to start or provide this service

FPC knows how to provide this service, but has no plan to start providing physical input to members
FPC is planning to provide physical input to members
Physical inputs bought and distributed by FPC to members
Physical inputs are prepared & distributed by FPC & then supplied with a marginal service charges

However, it was observed that a small portion FPCs (21 per cent) in category B prepared physical inputs
and distributed to members with a marginal service charge which is not the case with the best performing
FPCs. There are 5 per cent FPCs in category C, which also prepared inputs and distributed among
members.
50
4.6.3. Advisory Services
The FPCs may act as advisory bodies to member farmers issuing advice on agronomics, pest control,
plant nutrition, irrigation, and other farming technologies. Adoption of modern techniques and technologies
is expected to increase due to the implementation of schemes targeted at increasing the adoption of the
same through FPCs.

A majority of FPCs (67 per cent) in category A provides timely assistance, to the members on agronomy
while 48 per cent in category B and only 25 per cent in category C provide the same to their members.
It can be inferred from the above that the best performing FPCs from category A were better at providing
timely assistance, to the members as compared to FPCs from other categories.

C 18% 16% 31% 10% 25%

B 2% 10% 19% 21% 48%

Advisory Services

A 11% 11% 11% 67%

FPC does not aware about any such services or how to provide it to its members

FPC is aware of such servces but no such assistance provided

Assistance provided only if requested by group

Planning to provide assistance in short time/just stated on regular basis

Provides timily assistance to members / agronomy

Another important observation by the study was that majority of FPCs from category A explained to the
members how to mitigate risk through physical as well as financial measures which is in contrast with
majority of FPCs in other categories.

4.6.4. Transportation
Logistics involves transporting produce of member farmers to the market or to a buyer. Transportation is
an important concern in case of remotely located FPCs.

C 49% 14% 6% 27% 4%

B 19% 7% 12% 41% 21%

Transportation

A 33% 22% 45%

FPC does not help in transportation of member’s produce

FPC helps members in connecting with such service providers on rent/lease

FPC has its transportation vehicle, but does not take responsibility

FPC does not have owned transportation vehicle but takes responsibility of transportation
of member’s produce

FPC has its own transportation vehicle and provides it to members at minimal charges

51
 The study revealed that at least 45 per cent of the best performing FPCs in category A own their own
transport vehicle. In contrast to category A, only 21 per cent FPCs in category B and just 4 per cent
FPCs in category C own transportation vehicle and provides services at minimal charges. Thus, providing
transportation services are more widely accepted services in category A as compared to FPCs in other
categories.

4.6.5. Information Service

Information plays a crucial role in decision making. The information concerning the FPCs may include
demand of the members, market price trends, government schemes, policies and weather forecast.

C 28% 26% 14% 20% 12%

B 7% 24% 17% 26% 26%

Information Services

A 11% 22% 22% 45%

FPC does not know about service requirements of its members

FPC knows about requirements of members but does not provide any information such services

FPC knows about requirements of members and planning to provide the information of such services

FPC provides information on at least one such service

FPC provides information on more then one service

The number of FPCs providing information on more than one service required by members decreased
from category A to C through B. Most of the FPCs (45 per cent) in category A provide information on more
than one service that are required by their members. It can be inferred from the above trend that the more
of the better-performing FPCs are providing information on multiple services while FPCs, as compared to
other categories.

4.7. Impact Assessment

The study categorised the 131 FPCs survey in Maharashtra into three categorised and defined differentiating
features of the FPCs in each category. A correlation was found between the identified category and the
performance of FPCs on different parameters. Going forward the study attempts, to analyse the impact
of FPCs in different categories in order to determine in which areas FPCs from each category had more
impact on.

It was observed that a greater majority of FPCs in category A improved the prices of inputs for member
farmers compared, to other categories. At least 89 per cent of FPCs in category A, which are best-
performing FPCs according to this study, had a positive impact on the prices of inputs for the members.
Whereas 57 per cent of Category C FPCs had no change on price of inputs.

Similarly, a good majority (89 per cent) of FPCs in category A improved access to inputs for their members
while the improvement in availability of inputs was observed by 62 per cent in category B and only 44 per
cent in category C. In category C, more than 50 per cent FPCs have observed, no change for input prices
as well as availability of inputs.

52
 Impact on Input Prices Impact on Availability of Inputs

C 57% 42% 1% C 52% 44% 4%

No change No change
B 33% 67% B 33% 62% 5%
Improved Improved

Can’t say Can’t say

A 11% 89% A 11% 89%

Impact on Output Prices Impact on Output Management

C 44% 51% 5% C 42% 51% 7%

No change No change

B 10% 83% 7% B 10% 76% 14%

Improved Improved

33% 67% Can’t say 33% 67% Can’t say

A A

In case of impact on output prices and output management, FPCs in category B have performed much
better compared to category A & C FPCs, wherein 83 per cent of respondents from Category B, FPCs
observed improved output prices and 76 per cent have observed improved output management.

There have been improved on access to the subsidy for category A FPCs (78 per cent) and also category
C FPCs (52 per cent). For category B FPCs, only 36 per cent have seen improvement on this aspect. In
case of access to credit, there have been relatively a poor impact across all categories of FPCs, 56 per
cent, 60 per cent and 70 per cent, respondents do not see any change on this aspect for category A, B &
C respectively.

Impact on Access to Subsidies Impact on Access to Credit

C 1% 43% 52% 4% C 1% 70% 21% 8%

B 50% 36% 14% B 60% 31% 9%

Worsen Worsen

No change No change

Improved Improved
A 22% 78% A 56% 44%
Can’t say Can’t say

53
 Amongst all the areas, the maximum impact have been felt by the respondents in the areas of access, to
knowledge and access to infrastructure. For category A, almost all the FPCs have mentioned improved
access, to knowledge and infrastructure. In case of category C FPCs access, to knowledge and
infrastructure have also improved from 73 per cent and 59 per cent respondents respectively.

Access to Knowledge Impact on Access to Infrastructure

1%
C 23% 73% 4% C 32% 59% 8%

B 10% 83% 7% B 5% 90% 5%

Worsen
Worsen
No change
Improved
Improved
A 100% A 100%
Can’t say Can’t say

54
 Chapter 5

Recommendations and Action Plan

56
5. RECOMMENDATIONS AND STRATEGIC ACTION PLAN
Maharashtra is amongst the leading states, where promotion of FPOs in general and FPCs have
seen significant success. Certainly, the enterprising spirit and ability, to adapt to changes of farmers of
Maharashtra have played a pivotal role in this movement. In Maharashtra, there are few cases of highly
successful FPCs. However, there are also large number of FPCs, which are struggling for their existence.

As there have been substantial time since initiation of FPC formation in the state, now is time to look back
and assess, things which have worked for the FPCs and identify issues, which need to be worked upon
for better results on the ground.

In the previous chapters, information compiled from the survey of 131 FPCs have been analysed and
these FPCs have been classified into three broad categories (A, B & C). Characteristics of these FPCs
have also been described along with an analysis of various external and internal factors, influencing FPC’s
performance. In this chapter, specific recommendations have been made for each category of FPCs for
further improvement. Accordingly, a state-level Strategic Action Plan has been proposed.

5.1. Recommendations
As it has very clearly emerged from the assignment, there is the first category of FPCs which have achieved
a certain scale as a good institution and have adopted processes for governance (Category - A), the
second category of FPCs are trying to adapt, to the governance system and are trying to achieve financial
sustainability (Category - B) and there is the third category of FPCs, which are struggling at an initial level
of sustenance, making basic institution work and then strive for scaling-up businesses (Category - C).

To focus on scaling-up businesses,

Category –A: Enterprising profitability and adopting to
processes.

To work on governance systems,

Category –B: Intervening participation in decision
making and business volumes

To build on institution,
Category –C: Beginning awareness creation, member
engagement & business plan

Recommendations are also made in same order of development.

57
 Recommendations
Category – C: Developing Category – B: Category – A: Focus on scaling-
institution, homogenous Thrusting on up business, profitability and
Particular membership and thrust Governance adoption to processes
on business planning & structure,
execution decision making
and business plan
Institution zz Identifying socio-cultural zz Strengthening zz Strengthening the existing
characteristic of FPC existing system systems and processes of
members. for institutional institutional development and
zz Active membership development. increasing membership.
promotion campaign with the zz Recruitment of
clear pathway for members in technical team
terms of associated benefits. for executing
zz Making necessary provision necessary
for required manpower operations
for running the day- relating to
to day operation of the institutional
FPC,specifically appointment development.
of Manager / CEO and
Accounts Executive for
efficient management at the
initial stage.
Governance zz Setting-up an adequate governance structure, zz Strengthening the existing
which includes structure & schedules for governance structure for
conducting AGM, structure and schedules for improving efficiency and
meetings of BoDs. bringing professionalism.
zz Setting-up different management committees zz Setting-up an advisory board
under the board for adequately controlling / committee for guidance on
functions such as accounts & finance, marketing, policy and decision making.
operation etc. for taking adequate decisions. zz Adopting to IT-based solutions,
zz Setting-up system and appointment of a person app-based applications for
for record keeping, statutory and regulatory engagement and feedback
compliances mechanism for members.
zz Developing a procedure for making decision
related to policy and businesses.
zz Creating a system for ensuring active participation
of members and Directors in meetings of the
FPCs and a formal mechanism for engagement.

58
 Recommendations
Category – C: Developing Category – B: Category – A: Focus on scaling-
institution, homogenous Thrusting on up business, profitability and
Particular membership and thrust Governance adoption to processes
on business planning & structure,
execution decision making
and business plan
Operation & zz Appointment of a suitably qualified team with well- zz Use of IT tools for assessing
Management defined roles & responsibilities and proper Key demand / supply in advance for
Result Areas (KRAs) for managing the operations better planning and negotiation
of the FPC. in the market.
zz Working on creating a database of member z z Developing an investment plan
farmers for assessing actual demand for input as with Detailed Project Report
well as for the assessment of output for marketing. on the identified business
zz Identifying potential business activities for FPC, opportunity, along with a plan
starting from basic activities of aggregating for arranging required capital
demand for inputs, marketing of outputs, setting (equity and / or debt), working
up infrastructure for storage to primary value capital requirement etc.
addition and processing and preparing a business zz FPC needs to put in place
plan. risk management system
zz Setting-up SOPs for business operations, - insurance, cash handling
inventory management and record keeping. procedures, transit insurance,
zz Arranging required permissions, certificates for stock insurance, etc.
conducting an operation.
zz Targeting certification for processes and product
quality for better acceptance of products in the
market.
zz Organising training and capacity building
programmes for the staff for effectively executing
the operation.
Marketing zz Strategy for both marketing, zz Initiatives shall zz FPC can focus on developing
/ Business for input sale and output be taken-up its own brand for creating space
Development marketing need to be for developing in the market.
developed adequately. formal marketing zz The necessary network shall
zz Patronage bonus or any other arrangements be developed with potential
such mechanism should be with organised buyers from organised sector,
introduced for ensuring active buyers. processors and retailers.
participation of members in zz FPC, if suitable, shall target
FPC’s business. distant markets and export
markets for its products for
better price realisation and for
creating alternative marketing
channels.
zz Developing a mechanism
for market intelligence and
customer feedback for
responding better to the market.

59
 Recommendations
Category – C: Developing Category – B: Category – A: Focus on scaling-
institution, homogenous Thrusting on up business, profitability and
Particular membership and thrust Governance adoption to processes
on business planning & structure,
execution decision making
and business plan
Financial zz Developing a financial zz Regular zz Hiring services of professional
Management record keeping system for compliances of agency for regular audits of
documenting transactions accounts related accounts
and bringing a professional regulations.
approach to handling zz Adopting simple
accounts. accounting
zz Adopting practices of software for
transacting through formal managing
banking system with accounts
adequate records and trails. operation.
zz Hiring services of zz Hiring services
accountants for managing of a professional
day-to-day accounts and agency for
providing necessary inputs regular audits of
for statutory compliances accounts.
relating to filling of returns /
GST etc. on time.

Recommendations mentioned above are based on findings of the survey conducted for 131 FPCs and are
broad-based in nature. However, for taking-up the task of supporting these FPCs and implementation of
these recommendations, customised interventions shall be identified for each FPC based on a diagnostic
study of each of the FPC.

5.2. Strategic Action Plan

As it has been described above, Maharashtra has a very good seeding ground for new enterprises in
general and farm-based enterprises in particular. FPC is also a form of farm-based enterprise. However,
it also has other attributes of collectivisation. In that perspective, FPC is also a social enterprise. While
promoting FPCs in a different part of the country, it has been assumed that farmers will be able to run the
business collectively. However, after almost one and half decades of experimentation, it is now being felt
that farmers, in general, are not adequately skilled / trained to run the FPC business, though the FPC as
an institution still makes a feasible business case.

The above-mentioned assumption has further been proved under this study, wherein most of the
respondents representing the FPCs as Director, CEO or Manager have expressed their limitations,
specifically for required compliances and for other aspects of the business of FPC. Pragmatically, the
business of FPC is more complex than a simple commercial enterprise because the business of FPC
has got multiple aspects of engaging with members and other stakeholders. The FPC business requires
examining critical aspects which include creating value for shareholders, making profit from the business
and ensuring that products and services are provided, to the member farmers at much lower charges.
Therefore, the skill set of a Manager operating an FPC shall certainly be of higher level compared, to any
other similar enterprise being operated by an individual entrepreneur /businessman.

In Maharashtra, most of the FPCs have been promoted by the Government Agencies such as NABARD,
State Horticulture Department, projects like MACP and AIDP and central government agency like SFAC.

60
These agencies/projects promote these FPCs through local resource agency, which are mainly either
NGOs or Not-For-Profit Companies. Although, the staff of most of these developmental sector agencies do
not come from a commercial background, they perform a very good job in terms of farmers’ mobilisation and
registration of members. However, these agencies lack severely on the commercial aspect of a business,
which is compulsory for sustainability of the institution. In Maharashtra, since the last one-decade, a large
number of FPCs have been promoted by different government and corporate agencies and these FPCs
are in different stages of development.

With this background and considering the outcome of the survey of 131 FPCs in the state, it is pertinent to
develop a multipronged strategy for the state to address the issues and challenges of FPCs of different level
of maturity and performance. For resolving the multifarious challenges, it is proposed that a customised
‘FPC Incubation Centre’ (FIC) shall be set-up in Maharashtra. The proposed Incubation Centre, taking the
clue from this report, can work further on gathering insights of FPC promotion work in the state and can
develop a solution best suited for local needs. Broadly the proposed Incubation Centre shall focus on the
short-term and mid-term strategy, which is required for urgently assisting the FPCs, which are struggling
for their survival. The short-term plan shall target the FPCs, which are falling in category C of this report
and mid-term strategy shall target category B and category A FPCs.

Incubation Support

Enterprising FPCs/A
Intermediate FPCs/B
Beginner FPCs/ C
• Importance of quality.
• Formal agreements / tie-ups.
• Engagement strategy for members. • Opportunity assessment for
• Business plan preparation. • Networking with financial institutions business expansion.
• Handholding support. for raising capital. • Raising capital for infrastructure.
• Training, capacity building & • Business opportunity identification • Services expansion to members.
awareness on aspects of for scaling-up. • Help on legal matters.
institution development. • Training on compliances. • Awareness on technological
• Networking with successful • Help on legal matters. advancements.
FPCs.

Proposed FPC Incubation Centre can have the following services for FPCs

Short Term Strategy (Category C FPCs) Mid-Term Strategy (Category A & B FPCs)
Shortlisting potential FPCs for support Shortlisting FPCs venturing into next level of growth
Providing technical support for business plan Support for business planning, expansion and technical
preparation support for preparation of DPRs et.
Networking for peer learning and exposure Networking with industry, potential buyers, importers
Legal support for developing contract agreements and
Providing legal support for compliances
other documentation support
Creating network of CAs / Auditors to support Facilitating finance / capital for creating infrastructure,
the FPC value addition facilities / processing etc
Facilitating support for raising capital and
networking with the banks / NBFCs / other Peer group learning programmes and exposure visits
sources

61
 Short Term Strategy (Category C FPCs) Mid-Term Strategy (Category A & B FPCs)
Organising training & capacity building on Introducing the FPC to technologies of future and helping
regular basis in adoption
Setting-up Help-line for FPCs Help-line for FPCs

Detailed structure of proposed incubation centre can be worked out based on area coverage and targets.
Accordingly, team structure, finance, office space and infrastructure can be planned. Broadly, the scope
for proposed incubation centre can be as under

zz Institutional development support

zz Governance structure and processes
zz Business plan preparation, vetting and support for improvement
zz Technology identification and adoption
zz Organising capital, through debt / equity or working capital
zz Supporting innovation (solutions, technology, management)
zz Networking platform (peer learning, entrepreneurs, investors, business partners, expert, technical
support)

Proposed FPC Incubation Centre shall have the partnership of institutions/organisations, which have
higher emphasis on the commercial part of the business with a fair understanding of social, cultural and
developmental aspects of business.

For developing a practical approach and better engagement with the FPCs, the proposed incubation centre
shall also work closely with three-four FPCs from different categories and from different geographical
region,to develop them as Model FPCs for demonstration purpose. These FPCs, who have different
background and business models shall be helped in adopting ,to all the required practices, procedures,
staff structure and business model, which can be presented as a case study a learning platform for other
FPCs.

62
ANNEX-I

Segmentation and Scoring

Below the segmentation and scoring mechanism of each of
the parameter is provided
Parameter Highest Lowest Normalisation & conversation of Scoring and
Parameter
category value value values segmentation
1.Organisation Number 250 1 Normalised into Percentile against the 1-20 = 1
Profile of Villages highest Values 21-40=2
Covered (i.e. 250 taken as “100” and other 41-60=3
values converted into percentile 61-80=4
against 250 taking 100 as base) 81-100=5
Number of 4500 1 All values Normalised into Percentile 1-20 = 1
Members against the highest value 21-40=2
(i.e. 4500 taken as “100” and other 41-60=3
values converted into percentile 61-80=4
against 4500 taking 100 as base) 81-100=5
Growth in 4300 -9 All values Normalised into Percentile 1-20 = 1
Members against the highest value 21-40=2
Numbers (i.e. 4300 taken as “100” and other 41-60=3
(in absolute values converted into percentile 61-80=4
numbers) against 4300 taking 100 as base) 81-100=5
since
Inception
FPC age in 2772 311 All values Normalised into Percentile 1-20 = 1
days against the highest value 21-40=2
(i.e. 2772 taken as “100” and other 41-60=3
values converted into percentile 61-80=4
against 2772 taking 100 as base 81-100=5

Parameter Parameter Converting values into weighted Normalisation & Scoring and
category average conversation of values segmentation
2. Member’s Land To convert the percentage of the land After the conversation of 1-20 = 5
Profile Holding holding type into absolute numbers, the values into cumulative 21-40=2
Pattern the weighted average of percentage weighted average, 41-60=3
was taken. Values in each type of the normalisation was done. 61-80=4
land type was multiplied with certain All values Normalised 81-100=1
number* and summation was taken into Percentile against (Lesser values
The weight was as follows the highest value i.e. “7” was given more
Marginal Farmer=1 taken as “100” and other score)
Small Farmer= 1.5 values converted into
Medium=3.5 percentile against 4500
Large=7 taking 100 as base
(Marginal farmer% * 1 + Small
Farmer% * 1.5 + Medium * 3.5 +
Large * 7)
*This number indicate the average
land holding of each of this type of
farmer

63
 Parameter Normalisation & conversation of Scoring and
category values segmentation
3.Management CEO Already allotted scores were taken & Below high school = 1
Profile Education summation of score was done to get High school = 2
the score for management profile Higher Secondary = 3
Graduation = 4,
Post-Graduation = 5
Above PG = 6
CEO Already allotted scores were taken & Less than one year = 1
Experience summation of score was done to get One to three years = 2
the score for management profile three to five years = 3
Five to ten years = 4
More than ten years = 5

Normalisation
Parameter Normalisation & conversation of Scoring and
Parameters & conversation
category values segmentation
of values
4. Business Business Already allotted scores were taken and Summation of 1-20 = 1
Profile Activities done weightage was given wherever it was Scores was taken 21-40=2
by FPC found necessary All values 41-60=3
Normalised into 61-80=4
Activities Score allotment Weightage
Percentile against 81-100=5
Extension & “1” if FPC provided No Weightage the highest value
Advisory Service, “0” if FPC does (i.e. 17 taken as
not provide such activity “100” and other
values converted
Agri Service “1” if FPC provided No Weightage
into percentile
Support Service, “0” if FPC does
against 17 taking
not provide such activity
100 as base)
Agri-input “1” if FPC provided No Weightage
Sale Service, “0” if FPC does
not provide such activity
Agri-output “1” if FPC provided No weightage
Marketing Service, “0” if FPC does
not provide such activity
Infrastructure “1” if FPC provided No weightage
Rental Service, “0” if FPC does
not provide such activity
Value Addition “1” if FPC provided 4 Points as
Service, “0” if FPC does weightage
not provide such activity
Food “1” if FPC provided 5 points as
Processing Service, “0” if FPC does weightage
not provide such activity
Insurance “1” if FPC provided 3 points as
Service, “0” if FPC does weightage
not provide such activity
Credit “1” if FPC provided No Weightage
Service, “0” if FPC does
not provide such activity

64
 Parameter Scoring and
Parameters Normalisation & conversation of Values
category segmentation
5. Output Annual Turnover All values Normalised into Percentile against the 1-20 = 1
mid value 21-40=2
(i.e. 80000000 taken as “100” and other values 41-60=3
converted into percentile against 800000 taking 61-80=4
100 as base) > 80= 5
Profit All values Normalised into Percentile against the 1-20 = 1
mid value 21-40=2
(i.e. 1000000 taken as “100” and other values 41-60=3
converted into percentile against 1000000 taking 61-80=4
100 as base) >80= 5
Patronage Bonus “1” if FPCs has distributed the Patronage, “0” if 1 and 0 as
FPCs does not distributed Patronage indicated
Number of All values Normalised into Percentile against the 1-20 = 1
Farmer selling highest value 21-40=2
through FPC (i.e. 6500 taken as “100” and other values 41-60=3
converted into percentile against 100 taking 100 as 61-80=4
base) >80= 5

65
 ANNEX-II

Correlation Tables
Strength member mobilisation
Missing No formal Once formal No ongoing Formal Clearly Total
Entries membership membership formal membership articulated
campaign campaign membership campaign membership
or Informal but not campaign but activity- campaign
efforts capable but existing wise with annual
members are breakup not activities,
encouraged made promotional
materials &
incentives
A 1 1 1 0 2 4 9

Category B 0 1 9 16 6 10 42
C 0 8 26 22 18 6 80

Total 1 10 36 38 26 20 131

Membership fee share collection

Missing No Membership Membership Membership Membership Total
Entries Membership fees & fees & fees & fees &
Fees shares sold shares sold shares sold shares sold
charged inconsistent consistent, collected, consistent,
to new but no proper records records
members record developed developed
maintained but not and update
updated
A 1 0 0 0 2 6 9
Category B 0 0 4 2 4 32 42
C 0 7 16 3 15 39 80
Total 1 7 20 5 21 77 131

Board meeting
Missing No formal Board Meetings Meetings Meeting Total
Entries board meetings conducted conducted, conducted,
meetings conducted, regularly, participation participation
conducted but not participation is satisfactory, is satisfactory,
regular is minimal but few active members are
members active
A 1 0 0 0 3 5 9

Category B 0 0 0 0 18 24 42
C 0 3 8 12 29 28 80

Total 1 3 8 12 50 57 131

66
 Annual General Meeting participation
No AGM in AGM AGM AGM AGM Total
the last two every year; every year; every year; every year;
years attendance attendance attendance attendance
is below is between is 50 to 80% is more than
30% 30- 50% 80%

A 0 0 1 6 2 9
Category B 0 3 12 25 2 42
C 17 12 18 32 1 80
Total 17 15 31 63 5 131

Annual general meeting process

No AGM in AGMs AGM has AGM has AGM has Total
last two years conducted, published formal agenda, formal agenda,
does not agenda, but distributed distributed
have formal doesn’t reflect minutes to minutes to
agenda matters for attending attending and
discussion, members, but not non-attending
minutes not to non-attending members
distributed members
A 0 1 2 2 4 9
Category B 0 6 11 19 6 42
C 17 19 21 22 1 80
Total 17 26 34 43 11 131

Feedback of AGM
No AGM, No AGM AGM AGM AGM Total
no formal but informal happened, happened, happened,
or informal process for but member member given member given
process for collecting not given mandate and mandate and
collecting members mandate and feedback feedback,
member’s feedback feedback FPC actively
feedback solicits
members
feedback
A 0 0 2 3 4 9

Category B 0 3 7 24 8 42
C 19 13 19 27 2 80

Total 19 16 28 54 14 131

67
 Use of FPC service
No member < 25% of Between 50% to 80% Over 80% Total
used FPC members 25% - 50% of members of members
services in used FPC of members used at least used at least
last year, services in used at least one FPC one FPC
no record the last year, one FPC service in the service in the
maintained no proper service in the last year last year
record to last year
measure
participation

A 0 1 3 1 4 9

Category B 1 5 10 15 11 42

C 13 21 25 15 6 80

Total 14 27 38 31 21 131

Marketing services to members

No role in FPC Guides FPC take FPC procures FPC procures Total
marketing members for responsibility produce from produce from
member’s marketing, but of sale but member members
produce does not take not on regular regularly, regularly,
responsibility basis, does always refers always refers
not refer to to rates to rates,
rates before has market
selling intelligence
system

A 0 0 2 2 5 9

Category B 2 3 14 15 8 42

C 22 14 38 5 1 80

Total 24 17 54 22 14 131

Collective sales by FPC

FPC has not FPC has FPC has FPC has FPC has Total
conducted conducted conducted conducted at conducted
any collective at least one at least two least three more than
sales till now collective collective collective three
sale in last sales in last sales last collective
year year year sales last
year

A 1 0 0 5 3 9

Category B 3 12 16 3 8 42

C 32 31 12 2 3 80

Total 36 43 28 10 14 131

68
 Management of demand and supply
No pre No pre Takes order Takes orders Takes orders Total
order taking order taking in advance beforehand, do beforehand,
mechanism, mechanism, but not able analyses, but analyses
does direct does direct to analyse do not have and link
sale sale ability to link procurement
procurement as operations
per demand with demand

A 3 2 1 1 2 9

Category B 22 9 5 4 2 42

C 54 18 5 0 3 80

Total 79 29 11 5 7 131

Formal contracts to survey

No formal Informal At least At least More than Total
or informal contract with one formal two formal two formal
contract buyers but contract contracts contracts
or letter of no formal or letter of or letters of or letters of
commitment contract commitment commitment commitment
from any from buyers from buyers from buyers
buyer

A 2 3 2 0 2 9

Category B 18 8 12 2 2 42

C 57 13 6 1 3 80

Total 77 24 20 3 7 131

Quality inspection of products

No quality Minimal FPC has FPC FPC Total
inspection inspection SOP on implemented implemented
program by the FPC quality SOP on SOP on
conducted of incoming standards quality quality
by the FPC product or but not standards, standards,
before selling only if asked implemented No trainings actively
by buyers completely organised informs
but there on quality or trains
is no SOP inspections members
on quality on these
standards standards

A 0 2 3 2 2 9

Category B 3 13 1 12 13 42

C 47 21 3 6 3 80

Total 50 36 7 20 18 131

69
 Use of infrastructure
Never used/ Rarely/once Regularly Regularly Regularly Total
does not in a while used but less used with used with
have any used than 25% 25%-50% more than
infrastructure capacity capacity 50% capacity
utilisation utilisation utilisation

A 1 0 2 1 5 9

Category B 9 4 9 6 14 42

C 45 21 6 5 3 80

Total 55 25 17 12 22 131

Marketing personnel of FPC

FPC does FPC does FPC have FPC have FPC have Total
not have not have personnel personnel personnel
personnel personnel dedicated to dedicated to dedicated to
dedicated to dedicated to marketing marketing marketing
marketing marketing functions, but functions, but functions,
functions functions individuals individuals individuals
but received are not are not have
temporary trained trained adequate
support from training &
another capacities
agencies
A 5 0 0 0 4 9

Category B 21 10 5 3 3 42

C 63 13 2 2 0 80

Total 89 23 7 5 7 131

Pricing mechanism of FPC

No fixed FPC is FPC have Fixed method Fixed method Total
pricing planning to fixed pricing for calculating for calculating
method & make a fixed mechanism, price, price,
procedure pricing policy but farmers decided decided
opted by or leaders together by together by
FPC don’t know FPC & few FPC & farmer
about this producer members in
members transparent
manner

A 0 2 1 2 4 9

Category B 18 4 2 8 10 42

C 54 7 3 10 6 80

Total 72 13 6 20 20 131

70
 Pre-production market survey plan
FPC FPC know FPC is has FPC have FPC have Total
have no about this but rudimentary robust pre- robust pre-
awareness doesn’t have pre- production production
for this any plan production market survey market
market plan but survey plan
survey plan implementation and same
not done have been
properly implemented
properly
A 0 3 4 0 2 9
Category B 5 14 13 4 6 42
C 35 26 16 1 2 80
Total 40 43 33 5 10 131

Consumer feedback mechanism

No Knows the Has Has well Has well Total
awareness importance rudimentary defined defined
of of consumer consumer consumer consumer
importance feedback feedback feedback feedback
of consumer mechanism mechanism mechanism, mechanism,
feedback but has no and but feedback feedbacks are
mechanism system to feedback not taken taken regularly,
get it irregularly regularly improvement
measures are
undertaken
A 0 3 3 1 2 9
Category B 3 19 12 5 3 42
C 26 26 24 2 2 80
Total 29 48 39 8 7 131

Value addition by FPC

FPC is not FPC does FPC does FPC involved FPC involved Total
involved in basic grading grading/ in grading, in grading,
any type but no processing but packaging processing,
of value processing rudimentary or but no packaging
addition and/or no packaging branding of and branding
packaging done their produce of their
products

A 0 1 0 3 5 9
Category B 6 12 8 7 9 42
C 45 28 2 2 3 80
Total 51 41 10 12 17 131

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 Certification

FPC are not FPC aware FPC already FPC having FPC have Total
aware of of but do not applied at least one more
any kind of know how for such certification than one
certification and where to certification certification
apply for it but have not
received it
yet

A 2 4 0 2 1 9

Category B 10 11 5 7 9 42

C 35 29 7 6 3 80

Total 47 44 12 15 13 131

FPC participation in commodity exchange

FPC does FPC knows FPC in FPC already FPC actively Total
not know about process of registered on participating
about commodity registration/ commodity in trading
concept of exchange just registered exchange but activity on
commodity but do on commodity participated commodity
exchanges not know exchange irregularly exchange
how to but not
participate participated
in any trading
activity

A 3 1 3 1 0 1 9

Category B 6 7 17 8 4 0 42

C 8 24 37 9 2 0 80

Total 17 32 57 18 6 1 131

Accountant

No paid Paid Paid Paid Paid Total

accountant accountant, accountant accountant accountant
but no job with a with accurate with an
description & rudimentary job job description accurate job
no clear list of description and but no description
responsibilities responsibilities clear list of and clear
responsibilities responsibilities

A 2 1 2 0 4 9

Category B 18 4 2 10 8 42

C 70 2 3 5 0 80
Total 90 7 7 15 12 131

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 External audits
No external Basic Audits Audits Annual audit Total
audit done so inspection conducted conducted conducted by
far audit but irregularly annually, but a registered
completed final results external
not shared auditor,
with members results
shared with
members
A 0 0 1 2 6 9
Category B 7 5 5 10 15 42
C 21 7 7 20 25 80
Total 28 12 13 32 46 131

Balance sheet
No clear No balance No balance Reconciled Reconciled Total
idea about sheet, no sheet, but balance balance
balance separate separate sheet, sheet,
sheet and its listings of listings of detailed detailed
importance assets, assets, schedule for schedule for
liabilities and liabilities each line each line
equities and equities, item, but no item, there is
but not amortisation, amortisation,
reconciled depreciation depreciation
or equity & equity
payment payment

A 0 0 0 4 5 9

Category B 0 1 0 21 20 42

C 5 5 3 39 28 80

Total 5 6 3 64 53 131

Profit and Loss statement

No clear idea No accurate Accurate Record of all P&L net income Total
about P & L record of record of one revenues, is represented
statement revenues, area (record, expenses & in the balance
and its expenses and expenses, fixed costs, sheet, confirmed
importance administrative/ and but not through a
fixed costs administrative reconciled reconciliation of
costs) to bank bank statements
statements
A 0 1 0 4 4 9
Category B 0 0 1 17 24 42
C 7 3 7 33 30 80
Total 7 4 8 54 58 131

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 Profitability
Unprofitable Able to Able to Demonstrated FPC has Total
or unable to demonstrate demonstrate profitability consistently
determine just one profitability in all the last demonstrated
if they are profitable year twice in last three years profitability
profitable in the last three years since its
three years formation
A 1 2 4 1 1 9
Category B 8 20 8 5 1 42
C 49 15 6 10 0 80
Total 58 37 18 16 2 131

Working capital
Routinely Routinely Able to pay Able to pay Able to pay Total
short on short on members at members members
operating operating least half of entire entire
costs, costs, the amount amount due amount due
cannot pay cannot pay at the time to members to members
members members of collection at the time at time of
until buyer until buyer from of collection collection
has paid, has paid, members from the from the
buyer pays buyer pays members members;
later immediately FPC
established
line of credit
A 0 2 2 0 2 3 0 9
Category B 1 9 11 3 8 10 0 42
C 1 53 14 5 3 3 1 80
Total 2 64 27 8 13 16 1 131

Record keeping
There is no All record Master list Master list Master list Total
master list books not of all record of all record of all record
of all record maintained books, in safe books, books; they
books in a safe location, but they are are safe,
location to most records maintained current and
reduce loss not updated in a safe legible; and
to theft or or legible location and in adequate
conditions they are internal
current and controls
legible
A 1 0 1 2 5 9
Category B 4 1 2 22 13 42
C 33 8 3 24 12 80
Total 38 9 6 48 30 131

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 Access to credit
FPC doesn’t FPC knows FPC have FPC have FPC have Total
know how to how to apply applied for already got already got
take loans or for loan but loan but could the loan at the loan
FPC not in have not yet not get it least once and repaid
stage to avail applied due to lack at least one
loan of collateral, loan in timely
credit manner
worthiness,
documentation
etc.
A 0 3 0 2 4 9
Category B 2 12 7 17 4 42
C 14 41 14 9 2 80
Total 16 56 21 28 10 131

Mode of payment
Use cash Use largely Largely use Largely use Use all Total
payments cash but cheque cheque models of
only does Cheque payments. payment, payment
payments in Do not know knows Cash,
few cases about digital about digital Cheque,
payments payment Digital as
options but per the
does not use requirement
it
A 0 0 2 2 5 9
Category B 0 2 3 11 26 42
C 12 10 26 20 12 80
Total 12 12 31 33 43 131

CEO and roles

No paid Paid CEO/ Paid CEO/ Paid CEO/ Paid CEO/ Total
CEO/ Manager Manager manager with manager with
Manager selected by selected by accurate job accurate job
promoting the board, no description, description
institution but job description separate separate from
not consulting separate from board’s the board’s
board, no job from board’s responsibilities responsibilities
description responsibilities & receive
feedback
A 1 1 1 2 4 9
Category B 7 4 6 17 8 42
C 31 8 9 20 12 80
Total 39 13 16 39 24 131

75
 Decision making process
No clear/formal Decisions are CEO decides and Decision taken Total
decision-making being taken by then informs BoD with active
process CEO without and members participation of
informing anyone BoDs/members &
CEO with mutual
agreement
A 0 1 1 7 9
Category B 0 1 3 38 42
C 7 1 5 67 80
Total 7 3 9 112 131

Business plan preparation

Missing FPC have FPC There is a Business Business Total
Entries no clear knows the business plan is plan is
idea about importance plan, but it regularly regularly
preparation of business is neither used to used to
of business plan but current define FPC define FPC
plan and there is no nor used actions actions,
need of it documented by FPC progress is
business evaluated
plan & reported
to
members &
board

A 0 1 2 2 2 2 9

Category B 0 4 4 14 16 4 42

C 1 13 9 43 10 4 80

Total 1 18 15 59 28 10 131

SOPs
There are There are There are There are There are Total
no SOPs SOPs but documented documented documented,
they are not SOPs, but does & accessible accessible &
documented not cover all SOPs with a adhered policies
areas, not followed sampling of with routine
or not readily procedures inspection &
accessible by staff that followed updating of
& members accordingly procedures

A 0 3 2 2 2 9

Category B 13 16 3 4 6 42

C 48 17 9 3 3 80

Total 61 36 14 9 11 131

76
 Organisation communication

No organised Information Regional Formal Formal Total

channel of only representatives measures measures
communication provided to contacted in place to in place to
members & asked disseminate disseminate
who ask for it to verbally important daily info on a
disseminate information regular basis
important
information

A 0 0 1 3 5 9

Category B 1 0 10 8 23 42

C 9 3 36 12 20 80

Total 10 3 47 23 48 131

Use of software MIS

Does not Aware of Wants to use Planning to Already using Total

know about such software but not aware use certain at least one
advance but has not of which software but such software
software/MIS thought about software have not yet
system using such could be started
software useful

A 0 1 0 1 7 9

Category B 7 8 4 5 18 42

C 30 14 7 14 15 80

Total 37 23 11 20 40 131

Data collection and maintenance

FPC does Only basic Basic data Advanced Advanced Total

not have data of including land data of data or data
any data of members is holding and cropping collection
its members available Aadhaar card pattern process is
except list of details etc available, but ongoing
their names not updated

A 0 0 2 3 4 9

Category B 0 1 12 15 14 42

C 8 7 29 25 11 80

Total 8 8 43 43 29 131

77
 Awareness about schemes

Not aware of Knows Know how Have applied, Have applied, Total
any schemes about some to apply, but not benefitted
for FPCs schemes, but but haven’t benefitted from at least
don’t know applied yet from any one scheme
how to apply scheme

A 0 0 1 0 8 9

Category B 2 3 4 7 26 42

C 10 11 11 10 38 80

Total 12 14 16 17 72 131

Strategic orientation of CEO

CEO/BoD not Have Know the Has proper Have proper Total
clear about conception objectives planning in planning in
the concept of in mind but is of FPC, place but place, and
FPC not clear with but doesn’t does not executing
the definite have proper know how to plan to
objectives of planning to execute plan achieve future
the FPC proceed goals

A 0 0 3 0 6 9

Category B 0 0 12 8 22 42

C 8 7 34 15 16 80

Total 8 7 49 23 44 131

Financial services
FPC does FPC does not FPC knows FPC is trying FPC have Total
not know know how to how to get & planning to helped
that it can get loan for its loan for help members member
provide such members farmers, but in getting farmers in
service to its have not loan from getting loans
members provided any other financial for one or
facilitation to institutions other services
members

A 0 1 4 1 3 9

Category B 7 5 23 2 5 42

C 22 23 28 5 2 80

Total 29 29 55 8 10 131

78
 Input supply
FPC does not FPC knows FPC is Physical Physical Total
know how how to planning inputs inputs are
to start or provide this to provide bought and prepared &
provide this service, but physical input distributed distributed by
service have no to members by FPC to FPC & then
plan to start members supplied with
providing a marginal
physical input service
to members charge

A 0 0 3 6 0 9

Category B 1 2 15 15 9 42

C 8 7 40 21 4 80

Total 9 9 58 42 13 131

Advisory services
FPC is not FPC is aware Assistance Planning Provides Total
aware about of such provided only to provide timely
any such services if requested assistance assistance
services but no such by group in short time/ to members /
or how to assistance just started on Agronomy
provide it to provided regular basis
its members

A 1 0 1 1 6 9

Category B 1 4 8 9 20 42

C 14 13 25 8 20 80

Total 16 17 34 18 46 131

Implementation measures of crop reduction

Not aware of FPC have FPC is aware FPC have FPC is aware, Total
any physical shared have shared explained how encourages
or financial physical physical to mitigate and helps
measures measures to measures but risk through its members
on crop risk members but did not share physical and to join crop
reduction don’t know financial financial insurance
any financial measures measures schemes in
measures like every season
insurance

A 2 1 2 0 4 9

Category B 7 6 11 10 8 42

C 26 16 19 16 3 80

Total 35 23 32 26 15 131

79
 Transportation

FPC does FPC helps FPC have FPC does not FPC have Total
not help in members in its own have its own its own
transportation connecting transportation transportation transportation
of member’s with such vehicle, but vehicle vehicle and
produce service does not take but takes provides it
providers on responsibility responsibility to members
rent/lease of at minimal
transportation charges
of member’s
produce

A 3 0 0 2 4 9

Category B 8 3 5 17 9 42

C 39 11 5 22 3 80

Total 50 14 10 41 16 131

Information services

FPC does FPC knows FPC knows FPC provides FPC provides Total
not know about about information information
about service requirements requirements on at least on more than
requirements of members of members one such one service
of its but does not and planning service
members provide any to provide the
information of information of
such services such services

A 0 1 2 2 4 9

Category B 3 10 7 11 11 42

C 22 21 11 16 10 80

Total 25 32 20 29 25 131

Irrigation facilities

Bad Good Excellent Total

A 0 6 3 9

Category B 9 20 13 42

C 9 32 39 80

Total 18 58 55 131

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 Major livelihood crop production

1 2 Total

Category A 9 0 9

B 42 0 42

C 78 2 80

Total 129 2 131

Major livelihood dairy

0 2 3 4 5 6 Total

A 0 4 2 1 2 0 9

Category B 1 24 11 6 0 0 42

C 1 48 22 6 2 1 80
Total 2 76 35 13 4 1 131

Major livelihood small livestock

0 1 2 3 4 5 6 Total

A 2 0 3 1 1 0 2 9

Category B 3 0 12 14 5 3 5 42

C 0 1 23 35 10 4 7 80

Total 5 1 38 50 16 7 14 131

Major livelihood business

0 2 3 4 5 6 Total
A 2 2 1 1 2 1 9
Category B 4 1 4 10 14 9 42
C 5 2 8 21 30 14 80
Total 11 5 13 32 46 24 131

Major livelihood labour

0 1 2 3 4 5 6 Total

A 2 0 0 1 4 2 0 9

Category B 2 0 5 7 14 6 8 42

C 4 1 5 12 35 12 10 79

Total 8 1 10 20 53 20 18 130

81
 Major livelihood job

0 2 3 4 5 6 Total

A 2 0 2 0 1 4 9

Category B 5 1 3 4 14 15 42

C 5 0 2 3 27 43 80
Total 12 1 7 7 42 62 131

Road connectivity

Bad Good Excellent Total

A 0 3 6 9

Category B 1 10 31 42

C 5 19 56 80

Total 6 32 93 131

Road type
Unpaved road Seasonal road All-weather road Total
A 0 1 8 9
Category B 1 4 37 42
C 3 7 70 80
Total 4 12 115 131

Distance to nearest market

Very Far (More Far (10-25 Km) Near (Less than 10 Total
than 25 Km) Km radius)

A 2 5 2 9
Category B 14 19 9 42
C 22 37 21 80
Total 38 61 32 131

Distance to FPC office

Very Far Far (10-25 Near (Less 4 Total
(More than 25 Km) than 10 Km)
Km)
A 2 2 5 0 9
Category B 9 7 20 6 42
C 10 26 40 4 80
Total 21 35 65 10 131

82
 Electricity accessibility to FPC

Bad Good Excellent Total

A 0 5 4 9

Category B 3 12 27 42

C 4 22 54 80

Total 7 39 85 131

Impact on inputs

0 Change Improved Can’t Say Total

A 0 1 8 0 9

Category B 0 14 28 0 42

C 1 45 33 1 80

Total 1 60 69 1 131

Impact on inputs availability

0 Change Improved Can’t Say Total

A 0 1 8 0 9

Category B 0 14 28 0 42

C 1 45 33 1 80
Total 1 60 69 1 131

Impact on output prices

0 Change Improved Can’t Say Total

A 0 3 6 0 9

Category B 0 4 35 3 42

C 1 35 40 4 80

Total 1 42 81 7 131

Impact on output management

0 Change Improved Can’t Say Total

A 0 3 6 0 9

Category B 0 4 32 6 42

C 2 33 40 5 80
Total 2 40 78 11 131

83
 Impact on access to subsidies

0 Worsen Change Improved Can’t Say Total

A 0 0 2 7 0 9

Category B 0 0 21 15 6 42

C 1 1 34 41 3 80

Total 1 1 57 63 9 131

Impact on access to credit

0 Worsen Change Improved Can’t Say Total

A 0 0 5 4 0 9

Category B 0 0 25 13 4 42

C 1 1 55 17 6 80

Total 1 1 85 34 10 131

Impact on access to knowledge

0 Worsen Improved Can’t Say Total

A 0 0 9 0 9

Category B 0 4 35 3 42

C 1 18 58 3 80

Total 1 22 102 6 131

Impact on access to infrastructure

0 Worsen Change Improved Can’t Say Total

A 0 0 0 9 0 9

Category B 0 0 2 38 2 42

C 1 1 25 47 6 80
Total 1 1 27 94 8 131

Sense of membership

0 Yes Somewhat No Total

A 0 9 0 0 9

Category B 0 32 9 1 42

C 4 59 13 4 80
Total 4 100 22 5 131

84
 Reason of joining FPC
Missing On someone's Voluntarily On someone's Voluntarily Total
Entries recommendation but without recommendation and having
but without any any motive but having clear clear
motive motive in mind motive in
mind
A 0 0 0 3 6 9
Category B 0 4 5 13 20 42
C 4 4 9 43 20 80
Total 4 8 14 59 46 131

Awareness about FPC

Missing No knowledge Basic Knows about Knows how Total
Entries about FPC knowledge his rights and FPC can
functioning of benefit its
FPC members
A 0 0 2 1 6 9
Category B 0 1 14 7 20 42
C 4 5 36 10 25 80
Total 4 6 52 18 51 131

Perceived benefit of FPC

Entries It’s a fraud Clueless See no benefits Cheaper/ Total
timely inputs,
better price
for produce,
timely market
information
A 0 0 0 0 9 9
Category B 0 0 1 2 39 42
C 4 1 7 8 60 80
Total 4 1 8 10 108 131

Do you try to make new member

Missing No I want to but Yes, I've tried Yes, I've added Total
Entries have not tried but have not at least 1
yet yet added any member
members
A 0 0 1 2 6 9
Category B 0 6 6 7 23 42
C 4 7 12 18 39 80
Total 4 13 19 27 68 131

85
 Where do you see FPC after 5 Years
0 Clueless Don’t know Having vague Having clear Total
picture in mind picture in mind
A 0 0 0 2 7 9
Category B 0 2 2 22 16 42
C 5 3 5 48 19 80
Total 5 5 7 72 42 131

How can you contribute to success of FPC

Missing It’s not my Don’t By doing By doing business with Total
Values duty know business FPC, by encouraging others
with FPC to join FPC and by actively
participating in decision
making process
A 0 0 0 2 7 9
Category B 1 0 4 17 20 42
C 4 1 11 36 28 80
Total 5 1 15 55 55 131

Do you want to remain the member

Missing No with clear No without Yes without Yes with Total
Entries reason clear reason clear reason clear reason
A 0 0 0 1 8 9
Category B 1 0 0 12 29 42
C 5 1 1 31 42 80
Total 6 1 1 44 79 131

Do you think FPC provides such social benefit

0 1 2 3 4 Total
A 0 7 2 0 0 9
Category B 6 29 5 1 1 42
C 14 52 12 2 0 80
Total 20 88 19 3 1 131

Average produce farmer sold through FPC and other channels

0 0.5 Low Medium 5 10 12 15 20 25 30 40 50 60 70 80 100 Total

A 3 0 1 0 0 1 0 0 1 0 0 1 0 0 1 0 1 9

Category B 19 0 1 0 1 0 0 0 2 2 3 2 4 1 1 2 4 42

C 40 1 0 1 4 9 2 1 6 4 4 1 4 0 0 1 2 80

Total 62 1 2 1 5 10 2 1 9 6 7 4 8 1 2 3 7 131

86
 Deutsche Gesellschaft für
Internationale Zusammenarbeit
(GIZ) GmbH

A2/18 Safdarjung Enclave

New Delhi-110029 India

T: +91-11-49495353
E: [email protected]
www.giz.de/India

88