Technology for diary farming

Technology for diary farming

Akahsganga clocked Rs. 7.5 crore in revenues last year by bringing in efficiency to the diary collection process

S. MEERA

Milk collection centres are a lifeline for small and medium farmers with cattle to be able to supplement their incomes from the money they earn by selling milk to dairy cooperatives and private players. Traditionally, the measuring can was used to assess quantity. Quality testing, that is, measuring the fat content in the milk, was done after all the milk had been collected in a day and the farmer had no way to assess the veracity of the results.

Sulax Shah, was an electronics engineer working in a private company in Ahmedabad in the 1990s, developing green solutions. A chance travel to a village brought him in close quarters to a collection centre where he saw the need for technological intervention to improve the process of milk collection to ensure accuracy and transparency and improve hygiene.

“I noticed that the measuring cups produced mixed results and a lot of spilling happened, leading to issues of hygiene and wastage,” says Shah. He felt that an electronic weighing machine in a calibrated vessel would simplify the process.

Building a prototype

Shah spent time with the administrator at the centre to understand the logistics and work out a solution. He was especially particular that the testing for quality should be in the presence of the farmer to ensure transparency.

He also realised that the scope could be expanded to make one integrated system for billing and payments as well. An in-built printer would enable printing out the details simultaneously, thus preventing any fudging of records later.

Enthused by the response from the centres he discussed the details with; he spent two years developing the prototype in two years and found a willing volunteer in a village called Koba in Gujarat. Shah stayed back and fine-tuned the system as the collection progressed.

“One farmer claimed the system was erratic. But when tested, I couldn’t detect any problem. Then we found out that after calibrating his milk can, that farmer had tampered with his vessel. The weighing machine had helped catch it,” recollects Shah with pride.

Starting slow

Shah began with around five orders from villages near Koba and his brother assisted Shah in developing the products. His brother-in-law, who was running a business with five others, saw the working of the system and roped in his partners to fund the venture. Thus, Shri Kamadhenu Electronics, with its flagship brand, Akashganga, came into being in the mid 1990s. However, despite village-to-village marketing, the product did not find many buyers. “It was frustrating, but we did not lose confidence,” remembers Shah, the company’s founder-CEO. This quest took the company to a village near Anand, where the Amul Cooperative is located and here, it found the first official customer. This also gave it the courage to follow a direct approach and soon, Akashganga procured eight orders of 50 units each in the next couple of months.  Today, the Vallabh Vidyanagar (Gujarat)-based company has its products installed across Gujarat, Maharashtra, Nepal, Bihar, Uttar Pradesh, Sikkim, Tamil Nadu and Jharkhand. “We do not have a distribution network till date as our past experience has not been encouraging. We sell directly,” explains Shah. The company received  Rs. 18 lakh from Mumbai-based Aavishkaar in 2003 and in 2011, it received Rs. 1.5 crore (in two tranches) from Washington-based Grassroots Business Funds, which was used for expansion.

Currently, Akashganga employs 50 people and a majority are in the field installing, delivering and maintaining its systems. The challenge is delivering services across rural India. “Manufacturing, customising based on local needs and even supplying to remote parts is easy. But with poor infrastructure, finding people who will be able to offer services in the remote parts of the country is our greatest challenge,” admits Shah. The product itself has been upgraded to integrate with the developments in the electronics world such as including the latest chip, GPRS and data transfer systems in addition to integrating financial and accounting features and developments in the dairy industry. Shah continues to head research and development.

The recent surge in markets has led to a growth of 15 per cent-20 per cent year-on-year, with more than 4,500 installations across geographies. “India has 1,40,000 collection points just for the cooperative societies. There are private players as well, who are not on our radar,” Shah explains, outlining the potential for his product. The biggest competition is a public sector company, Rajasthan Electronics, apart from a few other players. “Where we differ is that we offer a range of features whereas the others specialise in one or two features,” says Shah.

Envisioning a future

Akashganga, which clocked Rs. 7.5 crore last year, is targeting Rs. 25 crore in the next three to four years. It is looking for funds to expand its team to reach more geographies.

Meanwhile, it is also working on additional features in its products – to develop a rugged solution for milk adulteration, currently not available in the market.

For market expansion, it is currently working with an NGO in south-India and, if this model is successful, then it may take this route to spread out further.

“Milk is a perishable product where speed is critical. Akashganga ensures that,” points out Shah. Significantly, it has also led to more farmers signing up to sell milk from their farms to the centres due to fairer, better payments.


Snapshot

AKASHGANGA (Shri Kamadhenu Electronics)

Founder: Sulax Shah

Year: 1996

State: Gujarat

Investors: Aavishkaar, Grassroots Business Fund

Focus: IT-based solution for efficient assessment of farm milk


An Aavishkaar case study in the regions where Akashganga was used in collection centres showed that 73 percent of dairy farmers, on average, increased the number of animals owned. Many of these people did not own any animals prior to the installation of this computerised milk collection system, but felt that after the installation, there was much more transparency in the operations of the cooperative and hence purchased cows. Here are some statistics following the installation of Akashganga at dairy centres:

42 per cent less time spent in wait. The average was 25 minutes, which went down to nine minutes.

There was an 88 per cent increase in the amount of milk sold to a dairy collection centre, due to the increase in animals owned by dairy farmers.

Year end bonus to members of the cooperative increased from 3.4 per cent to 5.2 per cent

Overall, the biggest impact seen is an increase in trust between dairy farmers and the dairy collection cooperatives


Concept in brief :

The urge to do something useful for society and a chance encounter with the inefficient methods of milk collection in rural India led Sulax Shah to develop a system that would ensure accurate measurement of the milk being collected and a milk analyser for transparent measurement of its fat content. These two ensured effective collection with no loss to either or malpractices. In addition, by integrating features for financial administration of a dairy centre, Akashganga, the dairy product from Shri Kamadhenu, has smoothened business operations as well. Funding from Aavishkaar in 2003 and Grassroots Business Fund in 2011 gave the company the bandwidth to expand markets. It is now looking for a third round to expand its team and spread its reach further.


Knowledge Partner:

Altacit Global is a boutique legal firm specialising in Intellectual Property and Corporate Legal Matters. Altacit Global has partnered with The Smart CEO, to present a series of articles on Impact Ventures. Please visit www.altacit.com for more details.

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