INCORPORATING SMALLHOLDER FRUIT AND VEGETABLE FARMERS INTO ORGANIZED RETAIL VALUE CHAINS

Abstract

The rapid development of the organized retail food sector (modern format supermarkets, hypermarkets and specialty stores) is a significant indicator of the economic and cultural revolution that India is currently undergoing. This development combined with the potential for India to become an important exporter of fruit and vegetables poses significant growth opportunities for small-scale farmers and the rural economy. In 2001, the latest year for which data is available, there were approximately 25.4 million Indian fruit and vegetable farmers. Some 70 percent of these farmed plots of less than one hectare (2.5 acres). It requires an average of about 150 small-scale farmers to service a supermarket produce department year-round. Much of the current literature on the growth of the organized retail sector in developing economies focus on the difficulties that small-scale farmers encounter in attempting to sell to the supermarket sector; although there are also a number of cases where this has been possible. The following case study illustrates the successful incorporation of small-scale Indian fruit and vegetable farmers into organized retail supply chains.