ABSTRACT

This chapter focuses on the analysis of alternative models of direct procurement of fresh vegetables. There are many contracts with different terms and conditions operating simultaneously based on the varying bargaining powers of the contracting parties. The chapter examines the relative efficiency of vegetable procurement contracts of Mother Dairy (MD) and Reliance Fresh and the traditional channels of marketing of products and validates the impact through field observations. It discusses one feasible option for increasing efficiency in the supply chains is setting up organized retail chains. According to the Indian Council for Research on International Economic Relations (ICREAR) report, the annual growth rate of organized retail in food and grocery is estimated at 16 per cent during 2004-7. MD under the National Dairy Development Board (NDDB) was started in 1985 as an organized retail chain of fruits and vegetables in India. The standard deviation (SD) and Coefficient of Variation (CV) are used as measure of price variations.