Digitalization: The Key Enabler for Inclusive Growth in Post-Covid Agriculture

Digitalization: The Key Enabler for Inclusive Growth in Post-Covid Agriculture

Insights Rashid Reza

The Covid-19 pandemic has forever changed business operations. The ongoing pandemic resulted in the loss of countless lives and stifling economic growth, yet agriculture in Bangladesh has been resilient—showing promises and opportunities for growth. While main growth drivers of Bangladesh GDP, industry, and service sector slumped, agriculture experienced a growth rate of 4.59% in FY 2020, an increase of 0.67% from the previous fiscal year. [1]

Identifying inefficiencies in the Agri value chain

Businesses that embraced digital technology have been reaping benefits during Covid pandemic. For Example, Chaldal, an online grocery delivery platform processed around 5,000 orders per day, and single order baskets almost tripled from BDT 1,300 to BDT 3,750. [2] Similarly, mobile financial service (MFS) providers such as bKash registered a growth of 23.6% in active customers. [3] The numbers demonstrate that in the post-Covid economy, digital technologies are not supporting tools for businesses rather an enabler for spurring growth and innovation.

Therefore, embracing digital technologies can revolutionize agriculture, a sector often associated with archaic business practices and an opaque value chain. For instance, policymakers and nongovernmental organizations associates growth in agriculture with combating food shortages and ensuring food security while the growth means increased profit and revenue for private Agri enterprises and corporations. Yet, the common denominators such as smallholders and Agri SMEs are often overlooked in the value chain, resulting in inefficient value chain and marginalization. Digitalization can introduce transparency and traceability in the value chain that benefits all stakeholders and entities.

How do digital technologies ensure food security while promoting inclusion?

Digitalization enables policymakers, donors, and non-governmental organizations to identify attractive value chains for sustainable growth, improving yields and nutrition indicators. For example, Krishi Utsho (KU), a social enterprise under Care Bangladesh, deployed AI-powered CRM to serve 200+ Agri input shops and 4,500 farmers. [4] The CRM developed by LightCastle Partners enabled KU to raise farmers’ income by 29%. Furthermore, 1 in 4 customers (26%) served by the system is a woman; promoting inclusion.

Fig. KU Key Matrices

How digitalization optimizes sales and identifies growth opportunities?

Digitalization allows Agri enterprises and corporations to identify growth opportunities, increase sales through cross-selling and partnership opportunities for expansions. For instance, Syngenta Foundation for Sustainable Agriculture (SFSA) partnered with LightCastle Partners, successfully digitalized their Farmers’ Hub model to optimize sales and identify growth opportunities.

eFarmers’ Hub is currently operating in six markets across Asia and Africa serving more than 600+ Agri entrepreneurs and 150,000+ smallholders. The platform raises the baseline for Agri SMEs and smallholders as well as increases sales for SFSA—smallholders’ income raised by 34% while post-harvest losses declined by 3-8%. [5]

Commercialized as Soluta-Ag, a joint venture of Syngenta Foundation for Sustainable Agriculture and LightCastle Partners, the platform offers the following benefits for the stakeholders in the distribution channel:

  • Smallholders and Agri Entrepreneurs: The platform facilitates access to markets by fostering partnerships and access to finance by recording transactions and income-generating activities.
  • Distributors: Soluta-Ag empowers distributors with data-driven insights to identify gaps in the market, growth hot spots, and in-season adjustments for inventory and stock management.
  • Agri Enterprises and Corporations: Industry leaders and senior management can get real-time operational insights from the platform to drive commercial growth through advanced analytics.
  • Policy Makers and Development Partners: Advanced analytics of Soluta-Ag equips policymakers and development partners with necessary tools for monitoring and channeling impact funds to attractive agribusiness ventures and foster collaboration for sustainable development. 
Soluta-ag Dashboard
Fig. Soluta-ag Dashboard

Today’s agricultural business landscape is more dynamic, but digitalization and data-driven insights can equip agriculture players with the necessary tools to unleash growth and foster inclusion. While the adoption journey marred with challenges, the benefits are clear: a catalyst for collaboration, empowerment, and inclusion. Digital technologies and advanced analytics can elevate agribusinesses from the red ocean to the blue ocean with untapped resources within the agriculture value chain.

Abdullah Reza, Digital Product Manager, at LightCastle Partners, has prepared the write-up. For further clarifications, contact here: info@lightcastlebd.com

References

  • 1. Gross Domestic Product (GDP) of Bangladesh 2019-2020 (Final) –  Bangladesh Bureau of Statistics
  • 2. COVID-19 Impact: Industries Experiencing Growth Due to the Pandemic – LightCastle Partners
  • 3. When Loss Brings Strength for bKash, The Business Standard
  • 4. AI Powered CRM for Agri Input Outlets – LightCastle Partners
  • 5. eFarmersHub: Digitizing Agribusiness Operations – LightCastle Partners
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