From Field to Fingertips: How InstaAgro leads the Transformation of Brazil's Agricultural Supply Chain

Date:07-08-2024

On Brazil's vast agricultural landscape, an innovative agri-input e-commerce platform called InstaAgro quietly transforms the traditional agricultural supply chain. 

As the first Brazilian company authorized to sell pesticides online, InstaAgro brings unprecedented convenience to small and medium-sized farmers and weekend farm owners in Brazil with its unique business model and extensive logistics network.

Recently, AgroPages interviewed Daniel Bachner, the CEO of InstaAgro. This interview delved into InstaAgro's founding background, business model, regulatory compliance, and other aspects, showcasing how this young company has carved out a new space in Brazil's agri-input e-commerce market through technological innovation and government cooperation. 

From the company's rapid growth to its future international development plans, InstaAgro's story not only reflects the digital transformation trend in Brazilian agriculture but also provides us with a unique perspective on the changes in the Brazilian agricultural market. Moreover, it offers a new model reference for companies expanding into the Brazilian market.

Interviewee: Daniel Bachner, the CEO of InstaAgro

AgroPages: Please introduce InstaAgro, including the founders' background, company history, business model, etc. 

  

Daniel Bachner: InstaAgro is a pioneering company dedicated to serving small and medium-sized growers and hobby and weekend farmers. Our mission is to create an "Amazon-like" platform tailored for this audience, providing access to high-quality products and cutting-edge technologies at competitive prices, with the capability to deliver small volumes across all states and cities in Brazil.

Founded in late 2019, InstaAgro's journey began with significant challenges. One of our primary hurdles was developing a specialized logistics service capable of delivering small volumes of products throughout Brazil at competitive prices. Additionally, we faced the challenge of creating new regulations for selling crop protection products through our e-commerce platform. This involved establishing a robust compliance process to ensure safe and legal sales to growers.

InstaAgro has overcome these challenges through relentless innovation and collaboration. Today, we are proud to have more than 35,000 customers and offer over 2,200 products. Our advanced systems, platforms, and automation enable us to deliver products to 5,189 cities across all states in Brazil. This remarkable achievement is a testament to our commitment to providing exceptional service and accessibility to growers nationwide.  

AgroPages: What are the recent overall trends in Brazil's agri-input e-commerce market? What market share does e-commerce hold in agri-input sales compared to traditional sales channels? 

  

Daniel Bachner: In Brazil's agri-input market, recent trends have been marked by a significant increase in the adoption of digital technologies to enhance production and yields. The new generation of agribusiness professionals is more inclined towards embracing these technologies, making digital solutions an integral part of the industry. The shift to digital channels, accelerated by the pandemic, has now become a defining trend for the future of agribusiness.

InstaAgro's innovative e-commerce platform plays a pivotal role in this transformation. By providing access to products and technologies in remote cities often underserved by traditional industry distribution systems, we are addressing a critical need for growers. Traditional sales channels primarily cater to high volumes for large farmers and provide warehousing services for commodities. However, they are less efficient in delivering medium and small volumes to farmers.

E-commerce is rapidly emerging as a vital component of the agri-input market, though precise market share data has yet to be available due to its exponential growth. As the market expands, data on e-commerce's market share will soon become available, further highlighting its significance in the industry.

AgroPages: InstaAgro was the first company authorized to sell pesticides online in Brazil. How did the company collaborate with the government to promote relevant regulations? What do you consider the biggest challenge in this process? 

  

Daniel Bachner: InstaAgro's collaboration with the government to establish regulations for online pesticide sales in Brazil was groundbreaking. Recognizing the need for regulation due to rampant illegal sales on existing marketplaces, InstaAgro took the initiative to request authorization for e-commerce sales of crop protection products. Working closely with the Ministry of Agriculture (MAPA), we identified the critical need for comprehensive regulations to ensure safe and legal sales. This effort culminated in the Regulation of Resolution SAA No. 59 of 12/21/2018. https://www.defesa.agricultura.sp.gov.br/legislacoes/resolucao-saa-59-de-21-12-2018,1227.html

Together with MAPA, we developed and implemented stringent compliance processes and rules to safeguard the interests of growers and the industry. This collaboration resulted in a robust regulatory framework that enabled InstaAgro to launch and promote online sales with complete adherence to safety protocols. These included secure sales transactions, proper collection procedures, farmer qualification checks, accurate prescriptions, and reliable logistic services for crop protection.

An essential aspect of maintaining these standards is the quarterly audit process conducted by MAPA. This regular audit ensures that InstaAgro consistently complies with all regulatory requirements and continues providing our customers safe, legal, and high-quality services.

The biggest challenge in this process was navigating the complexities of establishing new regulations in an environment plagued by illegal activities. However, we successfully addressed these challenges through our collaborative efforts with MAPA and implementing the Regulation of Resolution SAA No. 59 of 12/21/2018. We set a precedent for safe and regulated online pesticide sales in Brazil. 

 

AgroPages: InstaAgro's platform offers various products, including pesticides, seeds, fertilizers, and other agricultural inputs. How does the company ensure the qualifications of suppliers on the platform and the quality and service of various products? What unique practices does InstaAgro employ to ensure safety and compliance in selling and distributing particular agricultural inputs like pesticides online? 

  

Daniel Bachner: InstaAgro's platform features a curated portfolio that collaborates closely with a select group of top-tier suppliers to uphold stringent quality standards. Every product undergoes a rigorous screening process upon entry into our platform, reflecting our dedication to maintaining high supplier standards.

Our commitment to collaboration and excellence drives us to understand and address the specific needs of our customers. We carefully select partners who offer high-quality products and provide competitive pricing and comprehensive technical support.

To ensure our customers benefit from diverse options, we foster healthy competition among suppliers, avoiding favoritism or exclusivity. This approach promotes a competitive marketplace that empowers customers with multiple choices.

InstaAgro implements a robust compliance framework designed to safeguard the safety and quality of our products. Our comprehensive system ensures secure sales transactions, proper collection procedures, rigorous verification of farmer qualifications, and meticulous prescription accuracy. Moreover, our dependable logistics services ensure the safe distribution of crop protection products. These measures underscore our unwavering commitment to safety, compliance, and delivering exceptional service in the online sale and distribution of agricultural inputs.

AgroPages: InstaAgro's logistics system covers 5,189 Brazilian cities, which is rare in agrochemical distribution. Could you share how InstaAgro built such an extensive logistics network? 

  

Daniel Bachner: InstaAgro's logistics system covers 5,189 cities across Brazil, and is a remarkable achievement in the agrochemical distribution sector. This extensive network was built through strategic collaboration and innovative approaches.

Traditional agrochemical distribution systems were designed for high-volume transfers from industry to distributors, with large distances covered by industry-paid freight and smaller distances handled by distribution-paid freight. However, InstaAgro faced the challenge of delivering small volumes, such as a single liter of product, directly to farms over vast distances, with farmers bearing the freight cost.

To address this, InstaAgro had to provide low freight prices with high-quality services. The rapid growth of digital sales presented an opportunity as new logistics players entered the market, focusing on small volumes. InstaAgro leveraged this trend by designing and implementing a strategy matching the correct product portfolio with each region’s logistics partners. 

By collaborating with experts in transporting crop protection products, biologicals, fertilizers, and seeds, InstaAgro ensures end-to-end monitoring and quality assurance for growers. This collaborative approach and strategic partnerships have enabled InstaAgro to build a robust and extensive logistics network, setting a new standard in agrochemical distribution.

Every single bullet indicates one sales from

InstaAgro to the final customer

AgroPages: Regarding customer service, what scale/type of customers does InstaAgro currently focus on? In what main aspects can the company address these users' pain points? 

 

Daniel Bachner: Thanks to our extensive product portfolio, InstaAgro is dedicated to providing exceptional customer service, focusing primarily on small to medium-sized growers, business service providers, weekend farmers, condominiums, and industries. Our commitment to collaboration and customer-centric solutions sets us apart in addressing these diverse customer segments' unique needs.

We offer online support services by fully qualified agronomists ready to answer questions and assist. This ensures our customers receive expert advice and solutions tailored to their needs. When they require specialized technical assistance for particular products, we facilitate direct connections between growers and industry experts, ensuring comprehensive support.

InstaAgro's customer-focused approach addresses several key pain points:

Expert Support: Our agronomists provide reliable and accurate information, helping customers make informed product use and crop management decisions. 

Technical Assistance: By connecting growers directly with industry experts, we ensure quick and effective resolution of technical issues. 

Diverse Portfolio: Our range of products caters to various customer needs, from small-scale farmers to large industries, providing solutions for different agricultural challenges.

Through these collaborative efforts and a strong emphasis on customer satisfaction, InstaAgro continues to build lasting relationships and support the success of our customers in the agricultural sector.

AgroPages: We have noticed that InstaAgro has been proliferating in recent quarters. What do you consider to be the key factors driving this rapid growth? How sustainable is this growth? 

 

Daniel Bachner: InstaAgro's rapid growth in recent quarters can be attributed to several key factors, with a strong emphasis on strategic segmentation and customer-focused initiatives. By defining distinct strategies for our various business segments—e-commerce, marketplace, biologicals, and crop protection—we have been able to tailor our investments and initiatives to accelerate growth effectively.

This strategic segmentation has allowed us to build internal capabilities that enhance growth and efficiency. For instance, we have dedicated teams focusing on different marketing channels and platforms. One team specializes in digital marketing through Google Ads, Facebook, Instagram, TikTok, and WhatsApp, continuously working to improve our platform and reach. Meanwhile, another team is dedicated to marketplace advertising, campaigns, and promotions, targeting specific product portfolios.

Our approach also includes specialized initiatives for introducing and selling biological products and crop protection solutions in Brazil. Focusing on these distinct areas ensures that each segment receives the attention and resources needed to thrive.

The potential for continued growth is immense, and we see significant opportunities ahead. Our collaborative efforts and customer-centric strategies not only drive current success but also lay a strong foundation for sustainable growth in the coming years. By maintaining this focus, InstaAgro is well-positioned to continue its upward trajectory and meet the evolving needs of our customers. 

AgroPages: Looking ahead to the next five years, what significant changes do you anticipate in Brazil's agricultural e-commerce industry? How will this impact different players in Brazil's agricultural supply chain, including farmers, manufacturers, and retailers? 

  

Daniel Bachner: Brazil's agricultural e-commerce industry is poised to bring transformative changes in the next five years, emphasizing transparency, technology, and customer-focused solutions. This shift will significantly impact all players in the agricultural supply chain, including farmers, manufacturers, and retailers.

The e-commerce industry will enhance price transparency, making it easier for growers to access competitive rates. It will introduce to new technologies and provide farmers with valuable product information, best practices, and educational resources. This focus on the end customer will help eliminate inefficiencies in the traditional distribution model, increasing access to innovative products and technologies.

Manufacturers and retailers will benefit from reduced service and logistics costs, allowing them to concentrate on value-added activities. By streamlining the supply chain, e-commerce will enable these players to focus on product development, customer service, and market expansion, ultimately enhancing their business operations.

For farmers, shifting to e-commerce will result in better access to high-quality products and services at fair prices. This will help reduce production costs, improve efficiency, and increase yields. The overall impact will be a more efficient and responsive agricultural supply chain, with each player benefiting from improved practices, reduced costs, and enhanced access to market innovations.

By fostering collaboration and maintaining a customer-centric approach, Brazil's agricultural e-commerce industry will drive significant advancements, ensuring sustainable growth and success for all stakeholders in the supply chain.

AgroPages: As an innovative agricultural e-commerce company, what international development plans does InstaAgro have for the future? Have you considered collaborating with Chinese agricultural companies to jointly develop the Brazilian market?

Daniel Bachner: As an innovative agricultural e-commerce company, InstaAgro is committed to expanding its international reach and addressing existing gaps in the Brazilian market. We see significant opportunities to introduce new products to Brazil through direct import, eliminating unnecessary costs and focusing on maximum benefit to Brazilian growers.

We recognize the potential of collaborating with Chinese agricultural companies, which offer a high-quality portfolio of products at competitive prices that are currently unavailable in our market. We have developed a new strategy to capitalize on this opportunity and allocated dedicated teams and resources to foster partnerships with Chinese agricultural firms.

This collaboration will create a wealth of opportunities for both Brazil and China. By working together, we can bring innovative solutions to the Brazilian agricultural sector, enhance product availability, and reduce costs for growers. Our focus on innovation, collaboration, and customer-centric strategies will ensure mutually beneficial partnerships, driving growth and success for all involved. 

Procurement agent contact information: yangyang@instaagro.com