A

KACHCHA PRESENTATION ON
MBA PROJECT WORK

“ORGANIZATIONAL STRUCTURE OF FPO’S AND

MARKET POTENTIAL OF FRESH VEGETABLES IN
CHITTOOR DISTRICT. ”

Presented by Advisor
Dobbali Srujan Jagruti. D. Bhatt
Reg. No. : 2072117011 Asst. Professor
PGIABM PGIABM

Post Graduate Institute of Agri-Business Management,

J.A.U., Junagadh
1
 INTRODUCTION

➢ A majority world poor belongs to agricultural based rural households. Small

and marginal farmers constitute the largest group of cultivators in Indian
agriculture.
➢ About 85% of operational holdings are smaller than 2 ha and among these
66% are less than 1 ha.
➢ Even though they small farmers have competitive advantage over larger
producers, especially in their low cost in accessing family labour and
intensive local knowledge. there is danger that smaller farmers are squeezed
out, Because they face high unit transaction costs in almost all non labour
transactions
2
Source: Poulton et al.(2005)
➢A variety of approaches have emerged in response to problems faced by the
small and marginal farmers

➢A Producer Company(PC) is one such and relatively new legal entity of the
producers of any kind, viz., agricultural produce, forest producer, artisan
products, any other local produce where the members are producers

➢PC as a legal entity was enacted in 2003 as per sction 9A Companies Act
1956

➢Since then PC has been hailed as an organisational form that will empower
and improve the bargaining power, net income and quality of life of small
and marginal farmers in India

3
 COMPANY PROFILE
1. Name of the company Andhra Pradesh Mahila Abhivruddhi Society

2. Full postal address APMAS Plot 11 & 12, HIG, HUDA Colony, Tanesha Nagar,
Near Dream Valley, Manikonda, Hyderabad 500089
3. Email id info@apmas.org
5. Telephone no. +91 - 8413 - 403118 /120
6. Year of establishment 2001
7. Activities • Building social capital
APMAS has supported more than 2,50,000 SHGs.
• NRM and livelihood
Soil, water and energy conservation measures; ,drought and
risk mitigation; promotion of sustainable agricultural
practices
• Innovations and Pilots
Model villages; school improvement, solid waste
management; environment protection; skill development etc
4
 OBJECTIVES OF THE STUDY

1.To study the organizational structure of the farmer producer

organizations in Chittoor district

2. To study the market potential of fresh vegetables for

business institutions in Madanapally

3.To identify the specific requirements regarding vegetable

marketing mix for institution in Madanapally

4. To ascertain the constraints of farmer producer

organizations in Chittoor district

5
 SCOPE OF THE STUDY

• The study will provide the organizational guidelines for farmer

producer organizations

• The study will also give the limitations of FPO in terms of

technical constraints, labour and economic constraints and
problems related to marketing of the produce of FPO’s.

• The study will help farmer producer organization with

identification of new markets in different segments such as
hotels, restaurants, hostels and canteens.
6
 METHODOLOGY
Location, Study Area and Sampling

➢Location : Chittoor district of Andhra

Pradesh state was selected randomly.
➢APMAS has 4 FPOs in Chittoor
district so the 4 FPO’s were selected.
➢Then 10 members from each FPO
were selected randomly.

7
➢For the study of market potential and
identification of supplier characteristics
objectives, multi-stage random selection
was used
➢In the first stage, Madanapally was
selected purposively, as FPO of
Madanapally is looking foreword to
enter into fresh vegetable business
➢In second stage, 4 institutional segments
were selected such as hotels,
restaurants, hostels and canteens.
➢In the third stage, 10 institution were
selected from each segment 8
 Sample size
FPOs Members
Farmer Madanapalle 20
producer
organization Nimmanapalle 20
Ramasamudrm 20
Palamneru 20
Segments Number
Hotels 10

Institutional Restaurants 10

Business Hostels 10
Canteens 10

Total 120 9
 TYPES OF DATA

❑Type of data
Primary and Secondary both
Primary data
Primary data were collected with the help of well structured
questionnaires. Questionnaire may contain various parts as follows:
• General information about farmer members
• Constraints faced by the farmers in the organization.
• The business institutional members was interviewed regarding quantity
required and price paid and also information including order and delivery
times, mode of payments and perception of business institutions for supplier
characteristics.
Secondary data : It was collected from different sources like organization,
different websites and reports. 10
 ANALYTICAL TOOLS AND TECHNIQUE

➢Simple tabular method

➢Market potential analysis
➢Garrett’s ranking method

11
 TABULAR ANALYSIS

To analyze the organization structure of the farmer producer

organization simple tabular method was used. To analyse the
organisation structure following parameters were
• Basic profile of selected FPO’s
Number of share members Grama Rythu Samakyas associated
Number of directors Rythu samakyas associated
Authorized share capital Board of directors meeting
Equity share capital Land acreage operated
Annual general meeting Bank associated

Source: Dewangan (2018) 12

• Educational status of farmer members
• Land holding pattern of farmer members
• Irrigated area of farmer members
• Extension contact of farmers
Graphical presentation of data was done for easy analysis of the data.

13
 CALCULATION OF MARKET POTENTIAL

Total Market Potential = Potential number of buyers × Average

quantity purchased by a buyer × the price
The requirement of fresh vegetables for different institutions was asked to the
respondents.
The fresh vegetables were categorized into
Sr. No Categories Vegetables

1 leafy • Spinach, Palak, Menthi, Lettuce

and Amaranths

2 Basic •Potato, Tomato and Onion

3 other vegetables •Ridge guard, Drumstick, Brinjal,

Okra and Cabbage

Source: Srivastava (2008) 14

 GARRETT’S RANKING TECHNIQUE

The Garrett’s ranking technique was used to analyse the constraint

regarding the farmer producers organization. It is also used to rank
the supplier constraints.
Per cent position = 100 (Rij – 0.5)
Nj
Where,
Rij = Rank given for ith factor by jth individual.
Nj = Number of factors ranked by the jth individual.

Source: Savitha et al. (2011)

15
The Garrett’s table, the per cent positions was converted into scores. Thus
for each factor the scores of the various respondents was added and then
mean values was estimated. The attributes with the highest value is
considered as the most important one and the other follow in order.

Sr. No Rythu Constraints

1 Lack of awareness about group formation
2 Irregularity in conducting meetings
3 Irregular attendance in group meetings
4 Delay in payments to group members
5 Lack of awareness of the rules and conditions of group
6 Lack of maintenance of book keeping at group level
7 Lack of group harmony in group meetings
8 Difficulty in selecting group leaders
9 Problem of farmers leaving the group
10 Lack of auditing of the group records 16
Sr. No Constraints
1 Lack of group leaders attendance in the GRS meetings

2 Delay in payments to GRS members

3 Unawareness of the rules and conditions of GRS for farmer
members
4 Lack of GRS office infrastructure
5 Lack of storage area for implements and inputs
6 Lack of book keeping at GRS level
7 Lack of auditing of GRS finance
8 Lack of group harmony in GRS meetings
9 Difficulty in selecting of directors
10 Problem of groups leaving from GRS

17
Sr. No Constraints
1 Leader and Directors low attendance in the FPOs meetings
2 Delay in payments of FPO members
3 Lack of maintenance of book keeping at FPO level
4 Lack of auditing of FPO records
5 Lack of promoters funds for effective management of FPOs
6 Lack of group harmony in FPO meetings
7 Lack of storage area for implements and inputs at FPO level
8 Lack of expertise of professional manager for managing of
FPOs
9 Lack of pesticides and seeds in FPO business
10 Problem of GRS leaving from FPOs

18
19
20
Fig. 4.1. Formation of FPOs
21
 Board of
directors

Chairman

CEO

Manager Manager Manager

(Marketing) (Production) (Finance)

Service provider
(Rythu mitras)

Farmer Farmer Farmer Farmer

shareholder shareholder shareholder shareholder

Fig. 4.2 Organizational structure of FPO

 Table 4.1 The Comparative Study of four FPO's in detail.
Maryadaramana Nimannapalli Ramasamudram
Name particulars Koundinya (PLN)
(MPL) (NPL) (RSM)
Date of registration 05.1.2018 06.03.2018 21.04.2018 10.01.2018

U01820AP2018 UO1100AP201 U01820AP2018P U01100AP201

Corporate Id
PTC107411 8PTC107759 TC107856 8PTC107442
Authorised
15 15 20 15
capital(Rs. in lakh)
Equity Share
3 5 6 4
capital (Rs. in lakh)
No of Shareholders 1029 1056 4000 755
GRS Associated 6 5 15 7
Number of RS 96 70 105 90
Number of BoD 10 10 15 10
th
11 of every 25 of every 20 of every
BoD meeting 15 of every month
month month month
AGB meeting May April March April
Land (in acres) 1029 2915 4500 3000
Saptagiri gramina
Bank Syndicate bank Indian bank Canara bank 23
bank
Fig. 4.3 Educational status (n=80)
24
Fig. 4.4 Social category percentage (n=80)
25
Fig. 4.5 Land holdings (n=80)
26
Fig.4.6 Extension contact (n=80)

27
28
 Table 4.2 Segment wise market potential for fresh
vegetables (n=40)

Quantity required
Total Total
(kg/day) Per cent
Segments quantity business
contribution
Other (kg/ day) (Rs./day)
Leafy Basic
vegetables
Restaurants 585.20 699.60 825.00 2109.80 39520.80 23.85
Hotels 672.00 840.00 948.50 2460.50 46067.00 27.80
Canteen 476.80 534.40 582.40 1593.60 29584.00 17.87
Hostels 612.00 963.00 1089.00 2664.00 50472.00 30.48
Total 2346.00 3037.00 3444.90 8827.90 165643.80 100.00

29
 RESTAURANTS
Exotic
Basic 39%
33%

Leafy
28%

Fig. 4.7 Consumption of fresh vegetables by

restaurants(n= 10)
30
Fig. 4.8 Consumption of fresh vegetables by
hotels (n=10)

31
 CANTEENS
Basic Exotic
33% 37%

Leafy
30%

Fig 4.9 Consumption of fresh vegetables by canteens

(n=10)

32
Fig. 4.10 Consumption of fresh vegetables by hostels
(n=10)

33
34
 7:30- 8:30- 9:30- 8:30- 9:30- 10:30-
8:30pm 9:30pm 10:30pm 9:30am 10:30am 11:30am
Restaurants 2 3 4 Restaurants 5 3 1
Per cent 22.22 33.33 44.44 Per cent 55.55 33.33 11.11

Fig. 4.11 Order and delivery times of restaurant(n=9)

35
 4-6pm 6-8pm 8-10pm 6-7am 7-8am 8-9am
Hostels 3 2 1 Hostels 1 4 1
Per centage 50 33.33 16.66 Per centage 16.66 66.66 16.66

Fig 4.12 Order and delivery times of hostels (n=6)

36
 5-6pm 6-8pm 8-10pm 6-7am 7-8am 8-9am

Hotels 4 2 1 Hotels 1 5 1

Per centage 57.14 28.57 14.28 Per centage 14.28 71.42 14.28

Fig. 4.13 Order and delivery times of hotels (n=7)

37
Fig. 4.14 Mode of payments followed by business
institutions (n=40)
38
 Supplier Characteristics Ranking
Consistent
Quality

Meet sudden
Transparency
demands

Supply on time Supply on credit

Supplier
Reputation

39
40
 Table 4.3 Constraints faced by the farmers in Rythu
Sangam(RS) group of Madanapalle mandal (n=20)
Sr. No Constraints Mean values Rank
1 Lack of awareness about group formation 11.50 8
2 Irregularity in conducting of meetings 15.82 2

Irregularity of farmers members attendance for group

3 13.13 4
meetings

4 Delay in payments of group members 17.03 1

5 Lack of awareness of the rules and conditions of group 13.91 3
6 Lack of maintenance book keeping at group level 12.17 5
7 Lack of group harmony in group meetings 11.67 7
8 Difficulty in selecting group leaders 11.75 6
9 Problem of farmers leaving the group 9.00 9
10 Lack of auditing of the group records 8.48 10

41
Table 4.4 Constraints faced by the farmers in Gram Rythu
Sangam (GRS) group of Madanapalle mandal (n=20)
Sr. No Constraints Mean values Ranks
Group leaders low attendance in the GRS
1 9.91 9
meetings
2 Delay in payments of GRS members 11.76 7
unawareness of the rules and conditions of GRS
3 12.02 6
for farmer members
4 Lack of GRS offices for effective meeting services 15.93 2
5 Lack of storage area for implements and inputs 16.36 1
6 Lack of book keeping at GRS level 12.25 5
7 Lack of auditing of GRS finance 12.67 4
8 Lack of group harmony in GRS meetings 11.48 8
9 Difficulty in selecting of directors 12.81 3
10 Problem of groups leaving from GRS 9.27 10

42
Table 4.5 Constraints faced by the farmers in FPO of Madanapalle
mandal (n=20)
Sr. No Constraints Mean values Rank
1 leader and Directors low attendance in the FPOs meetings 10.91 8
2 Delay in payments of FPO members 15.18 2
3 Lack of maintenance of book keeping at FPO level 12.87 6
4 Lack of auditing of FPO records 15.41 1
5 Lack of promoters funds for effective management of FPOs 13.41 5
6 Lack of group harmony in FPO meetings 13.67 3
7 Lack of storage area for implements and inputs at FPO level 13.48 4

Lack of expertise of professional manager for managing of

8 10.81 9
FPOs

9 Lack of pesticides and seeds in FPO business 12.22 7

10 Problem of GRS leaving from FPOs 6.50 10

43
 Table 4.6 Constraints faced by the farmers in Rythu Sangam
(RS) group of Nimmanpalle mandal (n=20)
Sr. No Constraints Mean values Ranks
1 Lack of awareness about group formation 11.61 7
2 Irregularity in conducting of meetings 13.21 4

Irregularity of farmers members attendance for group

3 17.98 1
meetings

4 Delay in payments of group members 16.56 2

5 Lack of awareness of the rules and conditions of group 12.61 5
6 Lack of maintenance book keeping at group level 7.67 10
7 Lack of group harmony in group meetings 10.32 8
8 Difficulty in selecting group leaders 12.43 6
9 Problem of farmers leaving the group 14.15 3
10 Lack of auditing of the group records 7.92 9
44
 Table 4.7 Constraints faced by the farmers in Gram Rythu
Sangam (GRS) group of Nimmanpalle mandal (n=20)

Sr. No Constraints Mean values Ranks

1 Group leaders low attendance for the GRS meetings 13.43 4
2 Delay in payments of GRS members 17.27 1
unawareness of the rules and conditions of GRS for
3 9.36 10
farmer members
4 Lack of GRS offices for effective meeting services 15.06 3
5 Lack of storage area for implements and inputs 15.33 2
6 Lack of book keeping at GRS level 9.78 9
7 Lack of auditing of GRS finance 10.03 8
8 Lack of group harmony in GRS meetings 10.11 7
9 Difficulty in selecting of directors 11.33 6
10 Problem of groups leaving from GRS 12.75 5

45
 Table 4.8 Constraints faced by the farmers in FPO group of
Nimmanpalle mandal (n=20)
Sr. No Constraints Mean values Ranks
Leader and Directors low attendance for the FPOs
1 11.96 7
meetings
2 Delay in payments of FPO members 16.16 1
3 Lack of maintenance of book keeping at FPO level 14.23 4
4 Lack of auditing of FPO records 8.03 10
Lack of promoters funds for effective management of
5 9.90 9
FPOs
6 Lack of group harmony in FPO meetings 10.37 8
Lack of storage area for implements and inputs at FPO
7 12.83 5
level
Lack of expertise of professional manager for managing
8 14.47 2
of FPOs
9 Lack of pesticides and seeds in FPO business 14.30 3
10 Problem of GRS leaving from FPOs 12.21 6
46
 Table 4.9 Constraints faced by the farmers in Rythu Sangam
(RS) group of Ramasamudram mandal (n=20)
Sr. No Constraints Mean values Ranks
1 Lack of awareness about group formation 11.00 7
2 Irregularity in conducting of meetings 12.65 5

Irregularity of farmers members attendance for group

3 17.85 1
meetings

4 Delay in payments of group members 17.61 2

5 Lack of awareness of the rules and conditions of group 11.41 6
6 Lack of maintenance book keeping at group level 9.67 9
7 Lack of group harmony in group meetings 7.75 10
8 Difficulty in selecting group leaders 13.11 3
9 Problem of farmers leaving the group 10.45 8
10 Lack of auditing of the group records 12.98 4
47
 Table 4.10 Constraints faced by the farmers in Gram Rythu
Sangam (GRS) group of Ramasamudram mandal (n=20)

Sr. No Constraints Mean value Ranks

1 Group leaders low attendance for the GRS meetings 9.08 9
2 Delay in payments of GRS members 12.88 5
unawareness of the rules and conditions of GRS for farmer
3 13.06 4
members
4 Lack of GRS offices for effective meeting services 17.50 1
5 Lack of storage area for implements and inputs 17.36 2
6 Lack of book keeping at GRS level 10.10 8
7 Lack of auditing of GRS finance 10.30 7
8 Lack of group harmony in GRS meetings 15.58 3
9 Difficulty in selecting of directors 11.05 6
10 Problem of groups leaving from GRS 7.56 10
48
Table 4.11 Constraints faced by the farmers in FPO group of
Ramasamudram mandal (n=20)
Sr. No Constraints Mean value Ranks
Leader and Directors low attendance for the FPOs
1 10.31 7
meetings
2 Delay in payments of FPO members 17.21 2
3 Lack of maintenance of book keeping at FPO level 9.32 8
4 Lack of auditing of FPO records 7.97 9
Lack of promoters funds for effective management of
5 12.35 6
FPOs
6 Lack of group harmony in FPO meetings 12.95 5
Lack of storage area for implements and inputs at FPO
7 17.78 1
level
Lack of expertise of professional manager for managing
8 15.50 3
of FPOs
9 Lack of pesticides and seeds in FPO business 14.52 4
10 Problem of GRS leaving from FPOs 6.56 10
49
 Table 4.12 Constraints faced by the farmers in Rythu Sangam
(RS) group of Palamneru mandal (n=20)

Sr. No Constraints Mean values Ranks

1 Lack of awareness about group formation 15.35 3
2 Irregularity in conducting of meetings 16.73 2
Irregularity of farmers members attendance for group
3 17.33 1
meetings
4 Delay in payments of group members 12.30 6
5 Lack of awareness of the rules and conditions of group 12.47 5
6 Lack of maintenance book keeping at group level 10.56 7
7 Lack of group harmony in group meetings 9.26 9
8 Difficulty in selecting group leaders 9.61 8
9 Problem of farmers leaving the group 13.60 4
10 Lack of auditing of the group records 7.26 10
50
 Table 4.13 Constraints faced by the farmers in Gram
Rythu Sangam (GRS) group of Palamneru mandal (n=20)
Sr. No Constraints Mean values Ranks
1 Group leaders low attendance in the GRS meetings 16.02 2
2 Delay in payments of GRS members 16.06 1

unawareness of the rules and conditions of GRS for

3 14.63 3
farmer members

4 Lack of GRS offices for effective meeting services 12.85 5

5 Lack of storage area for implements and inputs 12.70 6
6 Lack of book keeping at GRS level 11.65 7
7 Lack of auditing of GRS finance 14.22 4
8 Lack of group harmony in GRS meetings 10.87 8
9 Difficulty in selecting of directors 7.98 9
10 Problem of groups leaving from GRS 7.48 10

51
 Table 4.14 Constraints faced by the farmers in FPO group of
Palamneru mandal (n=20)
Sr. No Constraints Mean value Ranks
Leader and Directors low attendance in the FPOs
1 8.93 10
meetings
2 Delay in payments of FPO members 12.13 5
3 Lack of maintenance of book keeping at FPO level 8.97 9
4 Lack of auditing of FPO records 9.37 8
Lack of promoters funds for effective management of
5 12.10 6
FPOs
6 Lack of group harmony in FPO meetings 11.47 7
Lack of storage area for implements and inputs at FPO
7 14.66 3
level
Lack of expertise of professional manager for managing
8 14.63 4
of FPOs
9 Lack of pesticides and seeds in FPO business 15.81 2
10 Problem of GRS leaving from FPOs 16.38 1
52
Table 4.15 Constraints faced by the farmers in Rythu Sangam
(RS) group of four mandal FPO's (n=80)
Sr. No. Constraints Mean values Ranks
1 Lack of Awareness about group formation 49.4625 5
2 Irregularity in conducting of meetings 58.425 3

Irregularity of Farmers members attendance for group

3 66.3125 1
meetings

4 Delay in payments of group members 63.5125 2

5 Lack of awareness of the rules and conditions of group 50.4125 4
6 Lack of Maintainance book keeping at group level 40.0875 8
7 Lack of group harmony in group meetings 39.0125 9
8 Difficulty in Selecting group leaders 46.9125 7
9 Problem of farmers leaving the group 47.2 6
10 Lack of auditing of the group records 36.6625 10

53
 Table 4.16 Constraints faced by the farmers in Gram Rythu
Sangam (GRS) group of four mandal FPO's (n=80)

Sr. No Constraints Mean values Ranks

1 Group leaders low attendance in the GRS meetings 48.4625 5
2 Delay in payments of GRS members 57.9875 3
unawareness of the rules and conditions of GRS for farmer
3 49.0875 4
members
4 Lack of GRS offices for effective meeting services 61.35 2
5 Lack of storage area for implements and inputs 61.7625 1
6 Lack of book keeping at GRS level 43.7875 8
7 Lack of auditing of GRS finance 47.2375 7
8 Lack of group harmony in GRS meetings 48.0625 6
9 Difficulty in Selecting of directors 43.1875 9
10 Problem of groups leaving from GRS 37.075 10

54
Table 4.17 Constraints faced by the farmers in FPO group of
four FPOs (n=80)
Sr.No Constraints Mean value Ranks
Leader and Directors low attendance in the FPOs
1 42.125 8
meetings
2 Delay in payments of FPO members 60.7 1
3 Lack of Maintenance of book keeping at FPO level 45.4125 7
4 Lack of auditing of FPO records 40.8 9
Lack of promoters funds for effective management of
5 47.7625 6
FPOs
6 Lack of group harmony in FPO meetings 48.475 5
Lack of storage area for implements and inputs at FPO
7 58.775 2
level
Lack of expertise of professional manager for managing
8 56.45 4
of FPOs
9 Lack of pesticides and seeds in FPO business 56.8625 3
10 Problem of GRS leaving from FPOs 40.6375 10
55
56
• The study concluded that the three tier system of FPO is giving its full strength
to spread the technology, inputs and machinery at accessible range for the rural
farmers. Powers and duties of directors, leaders and farmer shareholders giving
responsibilities to every individual to play their role for the overall development
of the organisational objectives along with individual shareholders development.
• It observed from the study that larger per cent of respondents were literate and
completed high school, so that the communication benefits to organizations
might be easy.
• The study also showed that the participants of organizations belongs to BC
social category and nearly 34 per cent of people have 2-5 ac of land. The
extension contact of farmers is also good as 33 per cent of people contact
whenever possible and only 19 per cent of people has never contacted extension
agent.
• The study also revealed that there is high market potential in hostel segment
because of their larger presence in the study area but only 60 per cent have
suppliers. There is large untapped market potential not only in hostels but also in
hotels and canteens. As the requirements may be low but an effective market
strategy can be helpful for both business and customers.

57
• The study also shows that the major problems encountered in the organisation
of four FPO at Rythu Sangam level were delay in payment of members,
irregularities of conducting meetings and farmers attendance in the meetings
• At Gram Rythu Sangam level, they face majorly lack of storage facilities for
implements and inputs, lack of GRS office for effective meeting service and
delay in payments of GRS members.
• At FPO level, farmers face delay in payments of FPO members.
 Specifically Madanapalle FPO is facing lack of records auditing.
 Nimmanpalle faces lack of expertise of professional managers.
 Ramasamudram faces lack of storage for implements and inputs
 Palamneru facing the problems of GRS leaving the FPO.

58
SUGGESTIONS

• The FPOs running under APMASS NGO were with spectacular track record. They were

building great network on ground with farmers, between the farmers and with other inputs

business institutions so that everyone gets benefited with the FPO concept but they were

little pushed in case of facilities, expertise knowledge and marketing aspects. So APMASS

organization should provide good facilities like offices, storage area for implements.

• The Madanapalle FPO should also look into the great market potential for fresh vegetables in

different segments of institutional business specifically hostels segments, which is with

highest market potential compared to others institutions. An efficient marketing strategy can

help the FPO to tap this potential. By this farmers can sell their produce locally and can serve

better for their customers as well.

59
THANK YOU

60