One of the meanings of Sustainability is it ‘being a method of harvesting or using a resource so that the resource is not depleted or permanently damaged’. In this context, a sustainable business model has to consider the sustainability of all stakeholders in its business both internal and external. A sustainable business model has to factor the sustainability of its supply chain that starts with the production in farmlands in the case of agricultural produce.
Digital technologies are heralding new means of engagement with multiple stakeholders. Digital technologies as a tool have been used predominantly to deliver market information, create awareness or for capacity building activities. On the other side, information from farmers usually relates to yields generated in fields. There often exist a lot of intermediaries at every level in the agri-supply chain, where digital technological interventions can play a disruptive role and bring much needed value addition in this domain.
It’s a prime case for digital technologies especially the distributed ledger technology to disrupt this value chain and bring in much needed transparency and traceability to the entire supply chain. It’s an age-old problem where the producer is at a disadvantage as explained by John F Kennedy “The farmer is the only man in our economy who buys everything at retail, sells everything at wholesale and pays the freight both ways”.
The agri-value chain consists of more than 500+ million producers catering to over 7+ billion people with a total value of over 3 trillion USD in yearly transactions. In this mix, the intermediaries control the chain with barriers around communication, marketing and finance and creating silos between producers and consumers. Due to this, USDA estimates that for every $1 spent by consumers on agricultural value chain only $0.085 goes to the farmer on top of it roughly 33% of the produce is lost or wasted.
In this context, Producers Market a startup organization that is developing a regional and global marketplace and consumer brand based on distributed ledger technology is digitizing and decentralizing the current, archaic system of agri-value chain by linking the producers with wholesale buyers and consumers directly. The integration of smart contracts will build transparency and traceability of transactions and also empower the producers and align shared value interests of supporting ecosystem and community resilience.
A Sustainable business would have to ensure that the resource (in this case producers) are not depleted, which was being witnessed in the case of early models where the producers (farmers) were not getting their fair share of revenue. With the implementation of distributed ledgers and smart contracts, the producers are empowered to participate in the agri-value chain and have a share in revenues from the value addition activities along the value chain. This enables the producers to become economically empowered and also create a Sustainable Business model where all stakeholders are duly recognized and value shared equitably. Sustainable business is about equitable distribution of revenues, where all the stakeholders in business are valued.
We must work together to ensure the equitable distribution of wealth, opportunity and power in our societyNelson Mandela