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Hatsun Agro to convert Rural Dairy Logistics to Retail Centers

May 22, 2008


Retail in Rural IndiaHatsun Agro Products, a leading Milk & Dairy products company is venturing into Rural retail segment. Currently, the company has 5,000 rural logistics centers for milk collection and related activities. However, the management of the company feels that, there is a cumulative spare capacity of 400,000 sft lying idle which it can uses for Rural Retail foray using existing manpower. According to the company, the setup cost itself will be 20% of the business expense and hence Hatsun Retail will have Zero Expense.

Hatsun plans to sell ready made garments, textiles and household utensils. The company can operate these centers with very minimum overheads to provide household goods at low margins to the farming community. This is a fantastic move by Hatsun, though margins will be low. However, just like how the Government proposed lower tariffs for telecom in Rural areas, it may come out with a scheme to encourage retailing in rural India couple of years from now.

Hatsun sells milk under the popular brands of Arokya and Komatha. Leading ice-cream brand Arun also belongs to Hatsun.

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