pipeline · Health

Increase production efficiency of tea factory and strengthen marketing strategy

Prithvinagar Small Farmer Agriculture Cooperative (PSFAC) is located approximately 10 km South of Bhadrapur close to the border with India. It focuses on the processing and marketing of tea produced by the members. Besides tea processing and marketing the cooperative is also involved in the business of savings and credit services to its members.The cooperative was established in 1995 in response to promote the production of tea by smallholder farmers, as the land in the area is very suitable for tea production. The cooperative started with only 25 members and 1250 NPR shared capital. Now, the cooperative has 2146 members and shared capital of 18.9 million NPR. Until 1999 the cooperative only collected tea leaves from its members and sold it unprocessed to a private tea factory. However, the prices offered by this factory where relatively low and there was no timely payment. Therefore, the cooperative created in 2009 the ambition to invest in its own processing factory. The large tea factory was built with government funding support. Total investment was 80 million NPR, of which 30 million government grant, 20 million loan SKBB (5% interest) and 30 million share capital of the members. Tea processing is new for PSFAC. So far the business has not created significant profit (0 in the 2016-17 fiscal year). PSFAC believes it can increase profit if it can optimize the efficiency of the factory and strengthen its capacity in marketing of the processed tea. By the end of 2018, through the collaboration with Agriterra, the cooperative strives to have its profitability of the tea factory increased with 5%. The partnership will work on constraints that were limiting Prithivinagar to scale up the processing activities and provide maximum returns to their members. On this basis, one of the main activities will be to develop a production plan and integrate it with the marketing plan. The activities will also include strengthening their supply and establishing linkages with different marketing channels to ensure maximum sales. To realize the improve marketing, Prithvinagar will recruit a marketing manager, who develops a marketing plan for the cooperative. Similarly, a student intern will do market research in close coordination with marketing manager to develop an effective marketing plan. For improvement in production activities, a consultant from Indian tea board will assist the cooperative in making an effective production plan. Provide better returns to tea member farmers by increasing efficiency of tea factory and improving marketing channels.