Agriculture has long been a cornerstone of life for many Sri Lankans, with approximately 28% of the population engaged in agricultural activities. However, despite this significant involvement, the sector’s contribution to Sri Lanka’s GDP has remained stagnant at around 7% for decades. This disparity warrants careful examination, particularly given Sri Lanka’s tropical climate and fertile soil, which offer ample potential for diverse crop cultivation unaffected by seasonal changes.
“There are fundamental issues confronting the agriculture sector and preventing it from realizing exciting opportunities and possibilities for farming communities and the whole economy. ” explains, Priyanga Dematawa Chief Operating Officer of DIMO Agribusinesses the agriculture arm of DIMO.
Low productivity and less profitability emerge as main barriers to the agriculture sector’s growth. Productivity issues primarily stem from inefficiencies in farmer operations at the field level, necessitating increased mechanization and technological adoption. Addressing these challenges requires a collaborative effort between government and private sector stakeholders, focusing on overcoming financial barriers hindering technology adoption among growers. Furthermore, uncertain policy frameworks impede private sector investment in agriculture, further constraining sectoral growth.
Profitability challenges extend throughout the agriculture value chain, particularly in the business segment catering to local and export markets. High Cost of Production (COP) driven by low productivity exacerbates these issues, constricting profit margins for farmers. Embracing data-driven scientific agriculture is essential for optimizing crop selection and varieties to enhance profitability in both local and export markets. Additionally, expanding the cultivation of export-oriented and import-substitution crops is pivotal for sectoral expansion. Beyond productivity enhancements, sustained modernization through value addition, diversification, and commercialization is crucial for fostering sectoral sustainability and combating poverty as a country.
DIMO Capitalizing
DIMO Agribusinesses has a vision to revolutionize agriculture, empowering both producers and consumers through strategic initiatives across the entire agriculture value chain. “Committed to transforming Sri Lanka’s traditional, low-tech and low-value agriculture, into a modern, high-tech and high-value industry, the company focuses on management best practices, technological innovation and groundbreaking solutions. Our visionary approach encompasses every stage of the agriculture value chain, ensuring procedural transparency and delivering high-quality products and services to consumers, thereby giving DIMO a strong foothold in the agriculture industry,” says Dematawa.
He explains that DIMO Agribusinesses’ extensive out-grower network lies at the heart of its operations, viewing farmers as invaluable partners who play an important role in their processed agriculture food segment. With over 1,000 primary producers in its network, DIMO plans to expand this to 10,000 in the next five years.
Research and development (R&D) form another cornerstone of the DIMO Agribusinesses strategy. They invest in cutting-edge R&D initiatives, focusing on agricultural research, product development, and process enhancements. “By staying ahead of the curve, we aim to share knowledge and technologies that empower farming communities,” Dematawa says.
From consultancy to education and training, DIMO offers a comprehensive suite of services that embrace next-generation agriculture. Additionally, their foray into agro-tourism highlights their commitment to showcasing their involvement in next-generation agriculture to a broader audience.
Agri-technology plays a significant role in driving productivity and sustainability. Through smart farming solutions, they equip farmers with the latest technologies and training to maximize their harvests. Their agri-tech teams provide solutions like micro-irrigation systems and protected house solutions, optimizing resource utilization.
DIMO remains at the forefront of innovation in agri-implements, providing affordable machinery to boost productivity and empower farmers. From primary land preparation to harvesting, their range of equipment and implements cater to diverse agricultural needs.
DIMO Agribusinesses’ dedication to farmer agriculture production processes extends to providing access to inputs, knowledge, and technical skills essential for enhancing productivity with its agriculture techno parks serving as hubs for intensive crop cultivation and technological innovation, driving industry advancement.
In its commitment to sustainability, DIMO prioritizes improving soil health and promoting a healthier lifestyle and through guidance in crop nutrition, crop protection, and seeds and planting material supplies, it empowers local farming communities while offering one-on-one extension services to ensure best practices are followed.
Growth Strategy
DIMO has emerged as a leading player in the agricultural sector because of its strategic approach to horizontal and vertical growth and impact.
Commencing operations in 2017 as an agriculture input supplier, DIMO Agribusinesses progressively diversified its offerings to include agrochemicals, plant nutrients, seeds, and agricultural technology solutions including micro-irrigation facilities, protected greenhouses and processed agricultural foods.
In 2019, DIMO Agribusinesses further solidified its position by acquiring majority shares in Plantchem Pvt Ltd and Plantseeds Pvt Ltd, renowned for their high-quality agrochemicals and plant seeds. Notably, the company has attained market leadership in seed paddy and watermelon through its seed arm, Plantseeds Pvt Ltd.
Expanding its horizons, DIMO Agribusinesses ventured into the food processing industry in 2022 as a significant milestone in its master plan. It features acquiring two companies specializing in virgin coconut oil production and value-added fruits and establishing “CocoFresh,” a coconut milk processing entity in Anamaduwa. The company is poised for global expansion with its value-added food products under the “MIDITER” brand while catering to local modern trade under the “FLAVA” brand.
Additionally, DIMO Agribusinesses has diversified its operations into coconut shell charcoal production at “DIMO CocoCarb,” capitalizing on Sri Lanka’s coconut industry. The company also serves farmers with affordable and quality water solutions through its alkaline pipes manufacturing entity in Nikaweratiya. Moreover, its foray into the agriculture service industry with “FLAVA by DIMO” in Dambulla aims to expand into agro-tourism in a unique way of implementation.
“By venturing into new market segments and offering diverse product and service categories, we have strengthened our position across the agriculture value chain,” Dematawa explains.
Recognizing the importance of market analysis and diversification, the company mitigates risks associated with market uncertainties. Embracing new customer segments and revenue streams, especially in the aftermath of the COVID-19 pandemic, underscores its commitment to sustainable growth and innovation. DIMO Agribusinesses remains dedicated to satisfying customer needs and ensuring market standing through continuous expansion and innovation.
Sharing insights into the vertical growth strategies of DIMO Agribusinesses, Dematawa points out that the focus is on both the back-end and front-end processes. “Recognizing the pivotal roles of farmers and customers, the company’s policies are tailored to ensure the sustainability of farmers’ livelihoods and deliver high-quality products to consumers through transparent and quality-assured manufacturing practices,” he says. Through trusted partnerships and structured buying-back agreements, DIMO fosters strong bonds with farmers, while ensuring adherence to quality standards through continuous field visits and expert guidance. Customer reach is primarily facilitated through a well-established dealer network across the island, supplemented by direct sales channels such as the “FLAVA by DIMO” active marketing hub and experiencing deck in Dambulla.
Efficiency and effectiveness are paramount in DIMO Agribusinesses’ manufacturing processes, with the team constantly refining operations to meet market demands and maintain quality assurance. Embracing advanced technologies is a cornerstone of their approach to mitigate current challenges and enhance productivity.
Regardless of the platform, the company is dedicated to providing quality products and services, backed by exemplary after-sales support. Rigorous planning ensures control over the supply chain, optimizing value chain operations to gain a competitive edge. Furthermore, DIMO Agribusinesses significantly emphasizes developing its human resources and aligning employee skills and knowledge with the company’s standards and values.
The Big Picture
The primary challenge for small-scale farmers is maximizing productivity from limited access to mechanization and advanced technology due to financial constraints. DIMO Agribusinesses is addressing this issue by planning to intervene with micro-financing facilities through its out-grower subscription model. This initiative aims to uplift farmers’ livelihoods and enhance agriculture productivity by providing collaborative micro-financing for advanced technologies such as micro-irrigation systems, protected houses, and agriculture input ranges.
In light of the imminent impact of climate change on agriculture, expanding the Agri-tech division is a critical objective. Recognizing small-scale farmers as vulnerable to environmental changes, DIMO Agribusinesses endeavours to protect them by reducing production costs through agriculture technology advancements and minimizing resource exploitation by introducing products like Penergetic, Limus-treated Urea, and NEB root exudates, along with slow-releasing granular fertilizers, enhances soil viability and improves yields.
Addressing seed paddy wastage, Plantchem Pvt Ltd has introduced polymer-coated seed treatment technology to reduce seed usage per acre and prolong germination norms. Furthermore, DIMO Agribusinesses collaborates with the Department of Agriculture Sri Lanka to produce locally and import high-quality hybrid seeds, ensuring higher yield levels for farmers. The introduction of agriculture drone technology facilitates efficient fertilizer application and seed paddy broadcasting, saving time and costs for farmers.
“DIMO Agribusinesses plans to explore alternative farmer income streams alongside agricultural practices, including agro-tourism initiatives to sustain farmer livelihoods,” Dematawa says. Leveraging resources such as farmer out-grower networks, agro-technology parks, and agri-experience centres, the cluster aims to contribute to increased employment opportunities in agriculture, thereby enhancing food security nationwide.
Long Vision
Dematawa concludes by expanding on the long-term vision for DIMO Agribusinesses and the facets that will help the company find success.
The establishment of a distinctive brand identity serves as a cornerstone, nurturing customer loyalty and trust, thereby rendering customer-centric growth more enduring amidst market dynamics. Moreover, personalized customer experiences and loyalty offerings wield substantial influence in cementing brand establishment vis-à-vis competitors.
Dynamic risk management practices emerge as pivotal tools in adeptly navigating market fluctuations, necessitating ongoing brainstorming to unveil effective risk mitigation strategies through meticulous assessment of the organizational landscape. The prioritization of environmental and social sustainability across all operational facets cultivates brand loyalty and underpins sustained business triumph.
Adapting to fluctuations in market trends and harnessing data-driven methodologies for market development and penetration are indispensable for maintaining competitiveness. The timely deployment of data analytics-driven product innovations facilitates the extension of brand and product lines, thereby captivating new customer segments and revenue streams. Furthermore, embracing advanced technologies assumes paramount significance in the pursuit of sustainable business growth, mandating comprehensive employee training to augment brand image and reputation.
Effective financial planning and control are linchpins in safeguarding organizational resources and perpetuating operational acumen. Diversifying business operations beyond conventional product or service paradigms entails venturing into novel local and international market platforms. Despite the inherent challenges in introducing products to diverse cultures and ethnicities, diversifying revenue streams across varied market segments remains imperative for long-term business sustainability. Moreover, forging strategic partnerships, both domestically and internationally, engenders mutual benefits conducive to market expansion and amplifies brand reputation.
“We are bringing all these facets together to drive greater impact and help transform agriculture into a sustainable, equitable growth engine of the economy while fuelling dreams and aspirations of the nation,” Dematawa says.