Bengaluru-based company aims to educate farmers about the benefits of organic farming; wants to bring organic produce to every household.
For 35-year-old Uma Prasad, organic farming is not something new. Her family has been into the farming business for generations now in Chikkaballapur near Bengaluru.
But the farmer suicides due to their inability to repay their debt, was something difficult to digest for Uma.
She says her father and grandfather, who were into organic farming, had not taken any loan from moneylenders or banks. Their lands were fertile, and even when there was no rain, the land had enough moisture to hold water, making it easy to grow a variety of crops.
Believing it to be a viable source of income and growth, Uma started selling vegetables and grains from her farm in Yelahanka near Bengaluru.
“What surprised me was my products started selling in two hours, and the success and acceptance was an added impetus. It gave me the idea of selling it on a larger scale,” says Uma.
She decided to start Grain Stories in December 2015 in Bengaluru with an aim take organic farming to other farmers across the country and to convey its benefits.
Uma says she faced many challenges initially. It was difficult to work with farmer groups and it was also not easy to make the farmers stick to organic farming, as they did not get good revenues in the initial days.
“We had to provide them with strong backup, motivate them and make up for their loss. We have lost many farmers due to this, but we are still trying,” she says.
To convert a regular farming land to an organic one,it takes about five years, says Uma. The team at Grain Stories encourages the farmers and trains them about soil rotation to eliminate the chemical content in the soil. They also advice farmers to rear animals such sheep, goats and cows to get animal manure, which helps inimproving the quality of soil.
The farmers are initially encouraged to grow vegetables and green leaves before growing commercial crops asthey get harvested quickly without getting in contact with the chemicals in the soil immediately.
Grain Stories currently has over 1,000 farmers in about 10,000 acres of land under them.
Spreading the word
Grain Stories is currently working with farmer groups in Karnataka, Andhra Pradesh and the North East states. It trains them to switch to organic farming methods, thus completely eradicating the use of chemicals.
The team works on a contract farming model and signs a contract with the farmers for the required produce.
“We buy the products and pay the farmers immediately on a cash and carry basis. We also provide them contacts to sell their goods at a better price. In case of leftover produce, we connect them to other farmer groups or organic direct selling companies who market directly,” says Uma.
This ensures the farmers get good revenues and assurance for their products. Also, the products procured by Grain Stories are packaged and sold at organised retail stores for which the farmers again get a margin depending on the crop output.On an average, an organic farmer gets around Rs 10 more than the conventional farmers for the same crop.
A team of 70, including the founder,trains farmers in the process of manure making. The farmers are also educated about soil conservation and bio-diversity to ensure they practice the right farming method and it also helps them get certified by the control union.
Grain Stories has also tied up with seedbanks, which educates the farmers on seed storage techniques and how to use them in a natural way.
Grain Stories offers various product categories like millets, cereals and dals. The team has also created a unique combination of processed muesli (millets with omega seeds, pumpkin seeds, watermelon seeds) and has flakes of millet, corn and wheat.
It also offers ready-to-cook products such as khichadi mix, kheer mix and has snacks like corn puffs, millet puffs and ragi choco puffs and some regular staples as well.
Grain Stories has a warehouse in Peenya in Bengaluru and has its own in-house lab, which tests the farm produce before procuring it.
These tests are done to ensure the products are completely organic and rule out the use of preservatives and chemicals during cultivation. Only after the tests are in place, the products are introduced to the market.
Market and growth
Uma says that the organic market today is seeing an increasing demand as people are shifting to organic produce due to many health-related issues. India is seeing an increase of 15-20 percent in the consumption of organic foods every year.
As per a study conducted by Assocham and TechSci Research, the organic market is estimated at $500 million currently, is estimated to jump to $1.36 billion by 2020.
Today, Grain Stories claims to be present in more than 600 physical retail outlets across India. It does not have stores of its own, but is sold in most organic outlets across India. In Bengaluru alone it sells in around 250 outlets.The products are also available on Amazon.
Grain Stories has its own distribution network in major cities like Bengaluru, Hyderabad, Chennai, Kochi, Mumbai, Delhi, Kolkata, Ahmedabad and Pune. It also works with retail outlets on a margin of around 20 percent, based on the maximum retail price (MRP) fixed for the products.
“As a producer, we will hardly get five to eight percent profit margin. Rest will go to the production costs,” says Uma.
A half kg packet of dal of Grain Stories is priced at Rs 30 and the processed products costs nearly Rs 300.
Competitors and plans ahead
Grain Stories competes with Pronature and 24mantra, and Uma says the company is able to earn revenues equally as others and that its customer base has increased considerably over the years.
The company was not profitable till the last few months mainly due to high working capital and other management costs. The startup broke even in the last three months, with about Rs 30 lakh month-on-month revenue.
Bootstrapped so far, the company raised a seed funding from a US-based company in 2016, and the money was primarily used for branding and packaging. The company is looking for more investments in the future as it plans to expand its presence and export its products.