Role of AI in the Inventory Management of Agri-Fresh Produce at HOPCOMS

Introduction

Fruits and vegetables are loaded with nutrients, minerals, vitamins, carbohydrates, proteins and other health benefits contributing to the trend of leading a healthy lifestyle (Halder & Pati, (2011). Regardless of the increasing production and demand, the wastage caused in the commodities cannot be ignored. It is necessary to focus on different factors which affect the quality and freshness in fruits and vegetables. The presence of a large number of intermediaries and inefficient infrastructural facilities are to be concerned (Sandeep Sachdeva, 2013). One of the main characteristics of the perishable commodity is the ‘life span’. Fruits and vegetables are restricted to limited shelf life and are expected to be consumed and traded within a particular period. Bhat et al., (2017) & Negi, (2014) highlights the characteristics of perishable commodities which includes temperature, moisture, and the environment. Fruits and Vegetables must be conserved accordingly, depending upon their characteristics to avoid any kind of wastage. To attain efficiency in time-dependent commodities it is significant to provide cold chain facilities to preserve the quality and freshness. Whilst, it is vital to provide cold chain facilities it is competence to follow ‘direct marketing’ in selling fruits and vegetables to consumer.

Time dependence in fruits and vegetables stipulated the need for an organized marketing system with efficient supply chain management in the process of reaching high-quality commodities to the customers. Therefore, the rise in demand for fruits and vegetable made way for new players in the Fruits and Vegetables market. To save the farmers from the hands of the middlemen, cooperative societies and private players came to the rescue. Karnataka one among the progressive states of India introduced HOPCOMS, a cooperative society under the guidance M. H. Marigowda intending to provide maximum share in consumer price for the farmers via promoting direct marketing (Chandrashekar, 2018). However, with the introduction of private players in the market, HOPCOMS needs to be flexible to the changing environment and upgrade itself to withstand the competition to retain the members in the society (Bharadwaj, 2015). Failing to use the potentiality efficiently, HOPCOMS was established with the need to being in a stronger management through a clear vision in the society (Kolady, Krishnamoorthy, & Narayanan, n.d. (2008).

The supply chain for the cooperative society of HOPCOMS which in turn acting as an intermediary to reach the commodity to the end users involves producer-farmers, retailers and customers. The society calls for high-quality fruits and vegetables from the producer-farmers wherein the retailers grade and sort the fruits and vegetables. The retailers are expected to sell the commodities procured from the procurement centers, to save themselves from penalty. Here, the penalty is subjected to a percentage loss of salary. As an effect, the retailers sell the left over commodities to bulk buyers such as hospitals, hotels, restaurants etc. However, due to limited cold storage facilities the retailer is given an exemption up to 3% (HOPCOMS, 2018).

Inventory management is vital for maintaining the efficiency of the supply chain management. Fruits and vegetables being perishable in nature should involve inventory management to avoid wastage and loss in terms of over stocking and stock out situations. The present study focuses on bringing in inventory management at HOPCOMS, a cooperative society. According to Sabir & Farooquie, (2017)& Sabir, (2016)managing and ordering inventory with a definite shelf life is a challenge for the retailers. Improper ordering decisions might result in stock out or overstock situation where the probability of wastage might increase. Whist, the retailers concentrate on stocking the commodities to satisfy the customers forgets to understand the actual demand for the particular commodity. Bhat et al., (2017) emphasize the perishable nature in fruits and vegetables which demands for effective inventory management as the customer choose to buy fresh and superiority commodities.