At Neebal Technologies which is focused on helping fertilizer companies beat the heat from the current DBT scheme of our government, we have closely studies the current challenges and this is what we have to say about it:
The current state of the Indian Fertilizer Industry
Before the current scheme came into effect, fertilizer companies were enjoying the subsidy payments from the government as soon as their goods reached the distributors. Now, they only get paid when the farmer buys it from the retailers and the sale is punched into a POS system.
Now imagine if you are running a multi-million dollar fertilizer company which gets paid only if the farmer buys it’s product. That is a huge shock to the system which was used to getting paid immediately. If government subsidies don’t come in as they amount to on an average 70% of the turnover of any fertilizer company. That’s millions of dollars stuck for days, maybe months.
At Neebal, we designed Subsidex to automatically read data from the DBT portal to monitor the digital movement of goods and provide various actions to ensure that subsidies are brought in faster from the government.
Digitization of the Indian Fertilizer Industry
You must be thinking how will the government know whether I am a farmer and what and when I buy?
The answer is that there is a mechanism that the government has put into action, starting with Aadhaar.
To ensure that the government can digitally track the movement of goods from the company to the distributor, then to the retailer, and finally sold to the farmer, the government has created a database of registered distributors, retailers, and farmers using Aadhaar, KCC etc.
Each receiver of goods needs to acknowledge the receipt of goods digitally to build their stock for sales and all sales needs to happen via government-approved POS machines. All this information on the digital movement of goods gets updated on the NIC portal.
What Subsidex does and how it helps
Subsidex downloads all this information and sends alerts/notifications to all the stakeholders to ensure that while we adhere to the process as directed by the government authorities, there are no delays in moving the goods digitally.
For instance, for a large fertilizer company (with revenue of over $ 1.1 billion every year), we deployed Subsidex to achieve 2 simple goals:
Move stock from distributor to retailer faster digitally (1st and 2nd point acknowledgements)
Stop hoarding of stock at distributor and retailer level (ensure faster turnaround time on sales, hence faster subsidy)
Subsidex has been able to bring down their delay in acknowledgement from an average of 50 days to down to as low as 1 day and in worst-case scenarios, it still saves over 15 days compared to the current scenario.
One of our client's monthly subsidy is about $100 million and with Subsidex,
We brought this amount earlier and helped them earn an additional interest of almost $1 million per month
We saved loss of subsidy which could have occurred when the acknowledgement didn’t get digitally punched in before the set deadline
We sent automated alerts for sales to ensure there are no dealers or retailers who are hoarding stock to delay subsidy payments
Our insights into movement of goods, subsidy prediction, top retailers, top distributors, and market share and exposure have helped the company to strategize and improve their cash flows to sustain hundreds of jobs and envision growth.
The additional $1 million per month should be ample to execute short-term and long-term plans.
Automation, if used wisely, can lead to a much more efficient organization. It has enabled us to upskill the current workforce into doing what we humans do best; Think, Do, Learn, Improve and Repeat.
About the Author
Saumil, Neebal’s Client Engagement Manager writes to showcase the impact Neebal has created for their customers by adhering to their ethos of ‘Be the Doctor’. Saumil loves advocating and practising ‘consultative sales’ and believes in empathizing with the customer as the best way to find a solution for them. Reach out to Saumil at email@example.com.