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cold storage business in india

This presentation slide will give you the knowledge about cold storage in India,cost of cold storage,future of cold storage,opportunity to do business of cold storage in India.potential of India to do business of cold storage.

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cold storage business in india

  1. 1. PRESENTATION ON “DISTRIBUTION CHANNEL ON COLD STORAGE FOR PERISHABLE GOODS” Presenter Name Abhi shah Kushal shah Urvi shah
  2. 2. • content  What is Distribution channel, why we choose cold storage ?  Why cold storage is necessary in todays scenario?  Wastage  Transportation modes  Economic & political  Technology use for different cold storage  Cost of cold storage  Future Aspects  Resources
  3. 3. What is Distribution channel, why we choose cold storage ?
  4. 4. • Distribution channel: A channel of distribution is a “set of interdependent organizations involved in the process of making a product or service available for use or consumption by consumer or business user”-Philip Kotler • Why cold storage? o In these present of high population growth rates, food supply has become diminutive. For filling this gap between demand & supply, there is a need to conserve the food supply in order to meet vegetables as these are more perishable. o All fruits & vegetables require specialized post harvest treatment appropriate temperature & relative humidity for their storage. o Establishment of cold storage provides refrigerated storage & preservation facilities for several fruits vegetables & flowers. o Because of technology advancements & logistic strategies the cold storage of perishable items has become an important stages in the distribution between manufacturers/ processors & retail location.
  5. 5. • Out of the 3443 cold storage units in India, 2975 are in private sector, 303 are in co operative sector and the rest are in public sector. • India’s vast produce rot due to lack of cold storage resulting in increased cost of the same produce as they die before they could even enter the market.
  6. 6. • Why cold storage is necessary in todays scenario? • India is the world’s largest producer of many fresh fruits and vegetables, milk, major spices, fresh meat, few fibrous crops such as jute, several staples such as millets, castor oil seed etc. and ranked amongst the world’s five largest producers of over 80% agricultural produce items, including many cash crops such as coffee and cotton. • For Example: agricultural sector get helps from; • NABARD provides refinance support to various eligible financing banks for financing cold storages under its normal refinance programme, the guideline for which are issued from time to time. • Government of India has sanctioned a capital investment subsidy scheme for construction/ modernization/ expansion of cold storages and storages for horticultural produce. • (NABARD) has been made a nodal agency for promoting the activity through credit delivery system. It has been planned to create an additional capacity of 12 lakh tonnes of new units and rehabilitation of 8 lakh tonnes of closed units under the scheme.
  7. 7. • Example of Amul industry
  8. 8. • Wastage • The cold storage system will greatly help in reducing the wastage of perishable goods. Generally the perishable goods wastage is more due its nature of short life and lack of storing facilities. Therefore the cold storage has a greater role in reduction of wastage. • Though India has lot many positives in the vegetable production and marketing sector, it has several disadvantages too. • The country lacks an efficient supply chain for the distribution of the fruits and vegetables and cold storage being the central point. Cold storage helps in increasing the consumption life and processing helps in preservation of fruits and vegetables which can be consumed during off season. • Poor marketing infrastructure • Insufficient cold storage capacity
  9. 9. • Unavailability of cold storages in close proximity to farms • Poor transportation infrastructure • Lack of quality consciousness & awareness, this results in instability in prices, farmers not getting remunerative prices, rural impoverishment resulting in farmers frustration &suicides.
  10. 10. • Status of Cold storage and its potential in India  The estimated annual production of fruits and vegetables in the country is about 130 million tonnes.  This accounts for 18% of our agricultural output.  Due to diverse agro climatic conditions and better availability of package of practices, the production is gradually rising.  Although, there is a vast scope for increasing the production, the lack of cold storage and cold chain facilities are becoming major bottlenecks in tapping the potential.  Present availability of cold storage capacity is only 103.5 lakh tonnes, out of which units having about 8 lakh tonnes capacity are non functional.  Although 90% of these units are made to store only potato even then it does not meet the requirement of the single crop, the production of which is about 300 lakh tonnes.
  11. 11. • Commodity wise distribution of cold storage capacity Commodity Units Capacity (lakh tonnes) Potato 2,012 92.82 Fruits & Vegetables 198 1.07 Meat 23 0.09 Fish 360 0.73 Meat & Fish 30 0.15 Milk & Dairy Products 272 0.68 Others 101 0.36
  12. 12. • TRANSPORTATION MODES
  13. 13. • Rail Nation’s largest carrier, cost-effective for shipping bulk products, piggyback • Truck Flexible in routing & time schedules, efficient for short-hauls of high value goods • Water Low cost for shipping bulky, low-value goods, slowest form • Pipeline Ship petroleum, natural gas, and chemicals from sources to markets • Air High cost, ideal when speed is needed or to ship high-value, low-bulk items
  14. 14. • ECONOMIC & POLITICAL
  15. 15. • Cold storage units can be used to store either a single commodity or multiple commodities. • Depending upon the entrepreneur's financial health; it can be planned to store the produce entirely owned by him or on rental basis or in combination of the two. • NABARD usually encourages cold storages where 70% of the capacity is available to farmers for storage on rentals. • Financial viability of a unit depends upon the intended pattern of use and rental rate prevalent in an area. However, units entirely to be used by the owners are also considered for sanction. • Considering 70:30 utilization of the capacity for rentals and own use, a 5000 MT capacity unit is considered as viable with the assumptions. • To set up a 5000 MT capacity cold storage unit although one acre of land may be adequate, it is always better to have two acres of land to take care of future expansions and waste management.
  16. 16. Political aspects: • Govt. of India promoting cold storage warehouse investments by providing subsidies up to 50% to 75% on Investment. • The nationalized banks of India are also proving loans for cold storage projects. • In the recent time cabinet also approved the amount of 6000 crore rupees for mega food processing projects. • The country requires 3.5 crore tonne capacity cold storage facilities and if somebody is looking for starting a business this is a right time.
  17. 17. • Technology use for different cold storage
  18. 18. • A cold storage unit incorporates a refrigeration system to maintain the desired room environment for the commodities to be stored. A refrigeration system works on two principles: • 1. Vapour absorption system (VAS), and 2. Vapour compression system (VCS) • VAS, although comparatively costlier, is quite economical in operation and adequately compensates the higher initial investment. • Wherever possible such a system should be selected to conserve on energy and operational cost. • However, it has its own limitations when temperature requirement is below 100C and many of the fruits and vegetables except seeds, mango, etc. require lower than 100C for long storage. • VCS is comparatively cheaper than VAS. • There are three types of VCS systems available depending upon the cooling arrangements in the storage rooms i.e., diffuser type, bunker type and fin coil type.
  19. 19. • Diffuser type is comparatively costlier and is selected only when the storage room heights are low. The operational cost of such units are also higher. • Bunker type is the cheapest and is preferred when storage room heights normally exceeds 11.5 m. Its operational cost is also low. • Fin coil type, although about 5% costlier than the bunker type, is very energy efficient with low operational cost and higher space availability for storage of produce. • Such system is used for units with room heights of 5.4m onwards. A comparison of electrical loads & energy savings, refrigerant requirement and space savings.
  20. 20. • Cost of cold storage • The following physical provisions with their costs are considered for a cold storage unit: • Land • Site development including levelling, fencing, road, drainage, etc. • Civil structures including main cold storage building, rack provisions, drying shed, machinery room, store for consumables, generator room, office, security cabin, etc. • Insulation of main cold store building • Machinery for cooling, air movement, loading, grading and weighing • Electric supply arrangement including installation of transformer and deposits for requisite connection • Standby electric supply arrangement/ DG set
  21. 21. • Water supply arrangement and treatment plant, if required • Pollution control and waste disposal equipment • Miscellaneous fixed assets including office equipment and furniture • Preliminary and preoperative expenses • Contingency
  22. 22. Estimated Capital Outlay (Rs.in lakh) Land and land development 50.00 Plant & machinery 148.00 Technical 2.00 Pre-operative expenses 17.00 Margin money 12.00 Building and civil works 85.00 Utilities 23.00 Misc. fixed assets 20.00 Contingencies 13.00 Total 380.00
  23. 23. • Future aspects
  24. 24. • Resources • Intranet site: www.google.co.in www.trade.gov • reading material: marketing management by Philip koteler • related resources: From class sessions & material provided by professors.

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This presentation slide will give you the knowledge about cold storage in India,cost of cold storage,future of cold storage,opportunity to do business of cold storage in India.potential of India to do business of cold storage.

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