25 September 2019

How does an online supermarket in India impact farmers?

Big Basket, a CDC investee business, is India’s largest online grocery, delivering over 5 million orders per month to customers in 25 cities across India. Big Basket’s business model is tailored to serve the needs of India’s growing urban consumers as well as its rural farmer suppliers. The business is also a major local job creator with 8,000 jobs.

This Insight study, How does an online supermarket in India impact farmers?, explores the impact of Big Basket’s ‘farm-to-fork’ value chain model on its fruit and vegetable farmer suppliers, focusing on their agriculture practices, productivity, pricing and access to markets. The study was conducted by Sattva Consulting in partnership with CDC Group and Big Basket. Through interviews and focus groups with over 400 farmers across six states combined with other data sources, our research explores how Big Basket serves the needs of rural farmers and provides opportunities to improve their livelihoods.

Key insights from our study include:

  • Big Basket reaches a substantial number of smallholder farmers through its supply chain, although its farmers’ landholdings are typically larger than the national average. Half (51 per cent) of Big Basket’s farmer suppliers are smallholder farmers with less than 2 hectares (5 acres) of land, compared with 86 per cent of farmers throughout India in this category.
  • 83 per cent of farmers report that Big Basket gives them the best price for their produce, through an innovative and transparent pricing system. On average, the prices Big Basket offers to farmers are 10–14 per cent higher than the local market average.
  • Big Basket helps farmers to access information, adopt better practices and improve productivity. Farmers report that they regularly interact with Big Basket’s agronomist and benefit from the support received.
  • Big Basket farmers are very satisfied with the business. Almost all (98 per cent) want to continue supplying to Big Basket and 96 per cent would recommend the company to other farmers.

 

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