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BACKGROUND of INTUIT

Founded in the year 1983 by Scott Cook by launching Quicken Headquartered in Mountain View, California Leading provider of financial management solutions for small and medium sized business. Started operations in India in 2005 as a development center to create software.

PROJECT AGRINOVA
In 2008, Intuit assigned its Global Business Division the task of exploring indigenous businesses in India to serve the local customers. The agrinova team identified agriculture as a promising market and conducted a preliminary research in the industry.

AGRICULTURAL SECTOR IN INDIA


Contributes to 25% of GDP Accounted for 60%-70% of employment Approximately, 150 million farmers growing crops for sale rather than personal consumption. 60% of cultivated area lacking proper irrigation facilities. Could not afford HYV seeds.

AGRICULTURAL SUPPLY CHAIN


The supply chain consists of farmers, middlemen and customers. Small farmers received only 40% of the retail price of their produce, middlemen received 35% and retailers & customers received 25%. Farmers sold 65% of their produce in mandis, 30% at farm gates to distributors and 5% directly to customers.

TRANSACTIONS IN A MANDI
6300 mandis in India till 2007, out of which 98% are regulated. Average of approximately 50 agents per mandi. 5% of sales in a mandi were done through auctions Remaining 95% were done through nonauction sales.

CONSTRAINTS FACED FARMERS


WHEN TO SELL

WHERE TO SELL

WHOM TO SELL TO

CONTINUED
Along with these problems they also had the problem of finding out the fair prices of their produce. Farmers were thus exploited by the agents as they entered into unfair private agreements with whole sellers.

INTUITS IDEAS
Intuit came up with the idea of crop price information service. SMS based services likeWhat to grow? When, Where and Whom to sell?

IDEA SELECTION
The Agrinova team selected to serve the second need of when, where and whom to sell? To increase access to information and price realization two services were thought ofCrop exchange Price Discovery System Ultimately, they decided to use the Price Discovery System.

NEXT STEPS
Firstly, need to tackle the big players and competitors in the segment. Secondly, Intuit had to change the behavior of the farmers and make them believe that they received better prices due to intuits services. Thirdly, to gather reliable price data from the agents. Fourthly, they had to find out whether the agents will partner them in the long run.

Lastly, and most importantly the serious questions were still unanswered1. Would farmers pay a transaction price? 2. Would Agrinova generate profit through ads? 3. How would agrinova recruit users? 4. How much it would cost to collect data? 5. Will they be able to cover their fixed costs and earn a profit?

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