New Delhi: One of the leading suppliers of packaging equipment in India, Packolabel Systems Pvt. Ltd, plans to buy and then lease refrigerated trucks to farmer groups and wholesale markets as it seeks to cash in on the growing demand for storage and cold-chain facilities in rural areas.
“Most of the big retail players also do not have enough packaging houses as of now and, so, are not able to get full value from the contract farming agreements,” says Neelkant Bakshi, managing director, Packolabel.
“They will need at least two years to set up such infrastructure and in the meantime we can develop the business.”
The Noida-based company, which has supplied packaging equipment to retailers such as Reliance Industries Ltd’s Reliance Fresh, Field Fresh and the Adani Group sees an opportunity in the surging demand for packaged vegetables.
According to Bakshi, Packolabel plans to buy around 150 such trucks in the initial phase and employ them in seven states, including Punjab, Haryana, Tamil Nadu, Andhra and Karnataka.
A report submitted by the standing committee on agriculture to Parliament in 2004 reported that post-harvest losses in India are over Rs50,000 crore annually.
The main reason for such wastage is said to be the lack of cold-chain facilities in the country.
“There is an inefficiency in the supply chain as of now. By grading and sorting, companies that take to contract farming will get a better value from their agreement,” says Deepankar Sanwalka, of consultants KPMG, who is an expert on the retail sector.
The trucks being employed by Packolabel will have a cold-storage section as well as equipment for grading, sorting and packaging. The farmers can bring their produce to a collection centre and sort and classify them using the equipments. The packaged fruit and vegetables can then be stored in the cold-storage section, which will be transported to the nearest cold storage. “The farmers can save more than 30% of their produce,” Bakshi says.
The company, which had revenues of around Rs173 crore last fiscal, says it hopes to ride the retail wave and for starters triple its business in the coming year.
“Our business is bound to expand with every client who sets up another retail outlet,” adds Bakshi.