How the FPO Sales Dashboard Will Benefit the FPO CEO?
Farmer Producer Organizations (FPOs) primarily earn revenues from input and output businesses. The FPO Directors have spent years, often decades, alongside other FPO shareholding members. Many would have imagined FPO Directors, and the CEO have a grasp of the figures to drive the FPO towards profitability. We have discussed the rationale for having an 'FPO Sales Dashboard' in 4 sections:
1. Overview
An FPO Sales Dashboard aims to provide the CEO with projected revenue and profit for input and output businesses, two primary revenue streams of any FPO. The dashboard also provides the CEO with a ready-to-use template to turn that projection into reality.
FPO profit margins hover between 5 to 10 percent in the first three years, amounting from a few tens to hundreds of thousands of rupees. That small profit margin leaves the CEOs a little room to decide on the transactions based on guestimate.
2. Why does every FPO need a sales dashboard
Let us share a story of FPOs we have been working with.?
FPOSoft is a web and mobile application to generate FPO business plans. FPOSoft has helped about 35 FPOs from Maharashtra, Odisha, Rajasthan, and Telangana to get their business plans.?
Using FPOSoft, the CEO and Accountant gather farmer data through a baseline survey. The baseline survey recorded responses from the farmers in five areas:
In almost all these FPOs, most farmers didn't quote the exact quantity of input supplies (such as seed, fertilizer, pesticide, and hours of farm equipment usage) or marketable surplus.?
The farmers gave figures like 5, 10, 15 kg, quintal, or hours in their response. The projected revenues and profits can vary by 10 to 20 percent, enough to make or break a financial year of the FPO.
The story tells us we tend to forget what we have done a few months ago. It's no wonder the CEO doesn't have a way to use the data to take business data either.
Every business needs to generate its list of prospects. Similarly, the FPO also has its list of the farmers. The CEO can use the member list to convert input and output business prospects.
3. Information in the FPO Sales Dashboard
The dashboard meets two goals. First, it provides the CEO with more precise data. Second, the dashboard provides the CEO with a list of the prospects.
The dashboard can provide information on five areas:
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a) Demand
b) Customers
c) Finances
d) Revenue
e) Fulfilment
We have outlined each area below.
a) Demand: It shall provide information on the quantity required to fulfill the input business and procurement target for the output business.
b) Customers: The dashboard shall provide the number of customers for the input business. The Dashboard can present a number of customers, derived from the baseline survey, transactions done in the previous season, or a combination of both.
c) Finances: FPO needs a cash advance to commit to the transaction. The FPO shall make a cash advance to a seed, fertilizer, and pesticide supplier. A wholesale buyer can also make a cash advance to the FPO to purchase the produce. The CEO shall be able to get such information in the 'Finances' section of the dashboard.
d) Revenue: This section provides projected and actual revenue. It can present the information by revenue streams - input and output business.
e) Fulfillment: Sales is about fulfillment. CEO keeps track of the input supplies delivered to the farmers in the fulfillment section. The section will also inform the CEO with the procurement made for trading of produce.
4. How it will help the FPO CEO
FPOs tend to regularize its revenue streams in the first three years.?
Most of the FPOs in plain areas with 500 to 1,000 shareholding members have the potential to generate Rs. 80 to 100 lakhs in this initiation period.
Sales Dashboard equips the CEO with information to convert the potential into reality.
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