Thursday, 01 April 2021 16:51

Advantages of Contract farming for the Rising Agropreneur

Advantages of  Contract farming for the Rising Agropreneur

For small farmers, taking the leap to start contract farming come with many advantages. Firstly, the nature of the pre-agreed contract protects agropreneurs from loss of profit in the future. This means that if the open market price goes down – due to cases such as oversupply - this would not impact the take-home income from the chilies sold. At GrasiCili, this arrangement has worked largely because the extra profits from whenever the market price is high, are strategically funneled into the participants’ collective funds. Thus in seasons of low market price, these funds will later be paid out to the participants to match the pre-agreed sale price. This modern business model is agreed by participants and minimizes risks of failing.

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  • Best Practices Type: Infographics
  • Industry: Agriculture
  • Company Name: GrasiCili
  • Geographical: Selangor
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