Entrepreneurship, Costing, Subsidy Schemes and Customer Service
What the exam tests here
Whether you can price a job honestly, estimate quantities, guide a farmer through the subsidy process and keep the customer after the sale.
Core rules
- Cost build-up: material + labour + transport + overheads + margin. Never quote from material cost alone.
- Quantity estimate: lateral length = area ÷ row spacing; emitters = lateral length ÷ emitter spacing; daily volume (m³) = area (ha) × depth (mm) × 10.
- Indicative installed cost in Maharashtra is roughly ₹50,000–1,00,000 per hectare for drip and ₹25,000–45,000 for sprinkler, varying with spacing, crop and head unit; always price from a current quotation.
- Subsidy under PMKSY "Per Drop More Crop" is shared between centre and state; small and marginal farmers get a higher rate than others, and Maharashtra adds a state top-up. Rates are revised by government resolution, so quote only the current one.
- Documents usually required: 7/12 extract or land record, Aadhaar, bank details, quotation from a registered supplier, design, invoice, geo-tagged photographs, installation certificate and inspection report; payment arrives by DBT.
- After-sales: written warranty, stated service response time, and follow-up visits after the first week and after the first harvest.
Worked example
Material ₹60,000 + labour ₹6,000 + transport ₹2,000 = ₹68,000. Overhead at 10% = ₹6,800, giving ₹74,800. Margin at 12% = ₹8,976, so quote ₹83,776, rounded to ₹83,800. If the subsidy is 55% of a normative cost of ₹70,000, the farmer receives ₹38,500 regardless of your quoted price - explain this clearly so the farmer does not expect 55% of ₹83,800.
Traps that cost marks
- Promising subsidy on the full quoted amount.
- Skipping the design or inspection report, which stalls the claim.
- Quoting a price that ignores transport to a remote site.
Quick recall
Material plus labour plus overhead plus margin; subsidy is calculated on normative cost.