China: Pagoda Orchard founds Industry Network Joint Venture

Recently, e-commerce platforms selling fresh produce have been faced with problems. After great success in the past two years, many now have to shut down or adjust their businesses. Instead of giving up the e-commerce fresh produce market, it may be better to just quit fresh produce, as fruit, in particular, is a very difficult product to work with, as it is not standardized, so it is hard to develop an e-commerce fresh produce platform.

Because the Chinese fruit production is not standardized, customer experiences differ greatly. For example, the same kind of fruit can be sweet today, and sour tomorrow. The size, taste and quality are all unstable, which is also the reason that the Chinese fruit industry has been lacking key brands. Fruit standardization is a problem for the entire fruit industry that urgently needs to be resolved.

Fruit standardization: an industry network is the key
Good fruit starts with planting. The same goes for fruit standardization. From the planting on, everything has to be standardized by using technology, so that it becomes a smart process. "Smart Fruit Technology" was born from this idea. Smart Fruit Technology is a joint venture between the leading fruit retailer Pagoda Orchard, Guangxi Talent Cloud Technology Co., Ltd. and Excellent Fruit Brand Management Co., Ltd. It is an industry network model.

Talent Cloud's agricultural data collection network and service platform (Talent Cloud Smart Agricultural Platform) already offers its service in over 20 provinces and cities, on more than 500 production sites. By founding Smart Fruit Technology, Talent Cloud's Grape Manager has gone through several transformations, upgrading its service from one product category to multiple categories. Compared to traditional agricultural production that is too dependent on experience and manpower, Smart Fruit Technology changes the production process from human focused to data focused. Its standard model has agricultural knowledge and the best production practice, so farmers can use this network for smart directions on their production process.

This cooperation brings three aspects together: internet, big data technology and agricultural technology. It offers four different standardized production factors, "weather, soil, farming tasks and physiology" for different kinds of fruit nationwide, which will accurately predict the product's production volume and quality. It will also summarize data from every production round to standardize the production flow. Simultaneously, with the help of the Smart Fruit Technology network, the farmer will also get relevant data on the current status of different products, so he can make adjustments if necessary. Using this smart technology can standardize the production of many fruit products.

Pagoda Orchard: a production and sales network
The merger and acquisition of fresh produce e-commerce platforms last year was an indication for the Pagoda Orchard's industry network strategy. As the founder of a fruit retail chain, what differentiates its network from others is that its strategy is the complete opposite. In 2013, Pagoda Orchard determined its strategy - to open offline store and to offer online service. Nowadays, many online companies are opening offline as well, an area Pagoda Orchard has already consolidated. Now Pagoda Orchard is developing its online business.

With its production network on one side, and its sales network on the other, Pagoda Orchard aims to use its industry network to connect production and distribution, in the short term to create a link between production and sales, and in the long term to realize a beneficial collaboration in the fruit supply chain. Smart Fruit Technology uses the internet to improve the traditional industry. By taking this big step, apart from upgrading the product quality and standardization, it will also improve the efficiency in the fruit supply chain.

At the opening ceremony for Smart Fruit Technology, Yu Huiyong, chairman of Pagoda Orchard, states: "The standardization of the fruit industry consists of three main parts: sales, purchases and planting, which will all be remodeled. Only when that is done can the entire industry can be improved. To solve the problems of consistent product quality and stable supply, standardizing the plantation sources will be one of the necessary steps to take."

Wang Xiaodong, chairman of Smart Fruit Technology, explains that Smart Fruit Technology is already offering its services on many production sites in Guangxi, Xinjiang and Chongqing. It is estimated that within 2-3 years, they can offer services for ten different kinds of fruits, covering a production area of 100,000 hectares (1 million mu). Simultaneously, Smart Fruit Technology will connect with other fruit trade platforms to realize a collaboration of the industry resources. They will also realize production and marketing integration for different channels, such as connecting farmers with the market, and offering financial insurance and rural capital, to create an efficient cooperation in the entire supply chain.