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17 JULY, 2017

Without a doubt, agriculture, and its allied sectors, is the largest livelihood provider in India. It also contributes a significant figure to the Gross Domestic Product (GDP). In fact, the GDP of agriculture and allied sectors in India was recorded at US$ 244.74 billion in FY16. According to the Economic Survey of 2016-17, the growth rate for the agriculture and allied sectors is estimated to be 4.1 percent for 2016-17.

India ranks second worldwide in farm output. Which means, there couldn’t be a better time for you to find your foothold in the business and make the most of it. Considering agriculture is such a huge industry in India, the opportunity to grow your business is tremendous. Because of the significant role the agriculture sector plays in country's economy, the government ensure that they go all the way to subsidize seedlings, fertilizers, and farming implements and machinery for farmers and also encourage entrepreneurs to go into farming. This means that several business opportunities in the agriculture industry stand at benefitting from it.

Considering you have worked through all the necessary steps to start your agriculture business and have put your business in motion, here are a few pointers that could help you grow your business and make it a profitable one.

Identify and manage Risks!

Agribusiness encompasses a host of sectors, from Production to manufacturing and distribution. This falls prey to a considerable turbulences with even a small fluctuation in the market. As a business, it is your duty to be prepared for the risks and adopt as much as you can. Growing your business and sustaining it will only be fruitful, if the risks are managed properly. Although you cannot always be ready for the unpredictable, you can always predict the most common risks and get your solutions in place. Here are some of the risks you have to take into consideration:

Competitive industry - The industry is competitive, and to be at par or ahead of the competition, you need to know about your competition. Keep a thorough check on what your competitors are doing.

Consumer's tastes - Consumer's tastes keep changing and it is your duty to provide them with products and services matching their needs and not get monotonous with your product. Apart from the technological advancements, be sure to keep your products fresh with attractive packaging, and appropriate marketing strategies.

Change is good, be ready for it - Agribusiness is unique because of its heavy dependence on the seasons. Your business strategies should also change and adapt to the changing seasons. One good way to keep track of the changes is by distinguishing short, mid-term, and long-term changes. This will help you have a specific strategy for each of the change.

Disruption to the supply chain - This can happen at any point of time and it is very difficult to be prepared for it. But try and have an alternate supply facility for the urgent deliveries, whilst you are bringing the chain back on track.

Financial risk due to recession, credit, or economic conditions - Price fluctuations, demand-supply cycle, govt. regulations and many such factors take a toll on your business activities. Make sure you try to cover as much ground as possible in ensuring that such unprecedented situations do not hamper your business. One way to do that is by taking small steps. However, big your year might be, make sure you take careful steps in growing your business. The last thing you want is investing a lot of money and effort just to be hit by one of such situations with no backup plan in place.


It doesn’t matter which agricultural field you have chosen to carry out your business in; it’s essential to have the right team in place. If your company deals with post produce activities, then you need a team to work out of an office. If your company deals with on-farm advancements, then you need people to work out of an office and people to visit the farms to keep track of the progress. Whatever the job role, make sure you hire employees who have good knowledge in the field of agriculture. Being a field that leaves very little opportunity to commit an error, it’s for the betterment of the company to have a group of individuals who know exactly what they are dealing with. Here are the teams you may want to employ in your company:

1) Research team– These guys are your eyes in the market. With the right team of researchers, you can get information on advancements in the field of agriculture, the trends that are shaping the business, the probability of where your business stands in the current market and more. They will also help you use this information to leverage your business growth.

2) Production & Manufacturing team – If your business is into selling goods and not services, then you need a team of professionals who will build your product to the right specifications. It is important that your manufacturing team is well-versed with the specifications of the product in order to steer clear from any production errors. It’ll also help if they have expertise to suggest changes to the product when necessary.

3) Legal Team – It’s easy to get pulled into legal issues when the government is so deeply involved in agricultural activities and practices. These can be health, environment and production issues. Risk management decisions have to be made constantly. There are conceptually four risk management issues, that one has to address. These are:

1. Risks that could result in small damage and would likely occur occasionally.
2. Risks that could result in small damage but would likely occur frequently.
3. Risks that could result in severe damage and would likely occur occasionally.
4. Risks that could result in severe damage and would likely occur frequently.

Hence, make sure you hire an excellent team of legal experts who know how to tackle problems efficiently without putting your company at risk.

4) Marketing Team – These guys are the link between your company and your audience. Most agricultural businesses cater to B2B clients, but there are companies that deal with B2C consumers as well. In either case, it’s important to market your business or service in a way that your brand is the first to come into their mind, when they want to avail that product/service. Your marketing team needs to be knowledgeable enough to stay up-to-date with changing marketing trends, track competitor's progress and come up with innovative solutions to get your brand to be noticed in the market.

5) Digital Team – You may wonder why there is a separate section for digital, and that it hasn’t been put under the marketing team. Well, this is because digital mediums are evolving even faster than we can imagine. In order to stay relevant with your consumer/client, you need to be active online. Hire a team of developers who can build you a website and a team of social media managers who will make sure you stay active and available for your consumers/clients on social platforms like Facebook, Twitter, LinkedIn and more.


How effectively your product/service can assist the farmer, is a factor that will help your business grow by leaps and bounds. By treating them solely as manual labour, you are not giving them the chance to learn and become better in their craft. Here are a few tips that will help you in the cause:

• Educate the farmer about your product/service so they know how to make the most of it.
• Introduce them to technology so they can easily connect with you for assistance.
• Help them understand how to use that technology, e.g. – Mobile phone or Internet.
• Educate them on farming matters.
• Get their inputs when it comes to product innovation.
• Listen to their problems and help them resolve it.

These are just a few ways in which you can help the farmer evolve from being just a helping hand on the farm.


There is nothing better than making your product/service easily available to your client/customer. Make sure you have employed the right channels to distribute your goods/services. This could either be done through setting up franchises around the country where people can directly purchase/avail your goods/services. If you are in the manufacturing business, you can go digital and join hands with the best e-commerce portal to ship your product or, find the right local vendors to distribute the goods for you.


Growth is impossible without a constant flow of funds. In order to sustain good cash flow, you need to look beyond putting money out of your own pocket. Your business cannot entirely depend on funding from you and your partners to support its activities. This is where you need to look at ways of accessing a line of credit, overdraft protection, bonding or bank loans to expand your activities and grow your business. With the right banking partner, like Kotak Mahindra, you can avail plans that will support your business ideas and help you grow into a thriving one. Talk to the relationship manager at Kotak Mahindra and get connected to a host of options for your business. 

Check out more articles on how to start, run and grow your business.

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Disclaimer: This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from the Bank. The Bank, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.