Editor's Choice, February 2013: Agribusiness and smallholders: solutions to nurture
When planting, farmers select the strongest seeds. So companies should select the strongest solutions in their engagement with smallholders, aiming to produce high yields and cope with adverse environments.
This is the message from this month’s Editor’s Choice, Growing Business with Smallholders, written by Endeva and Joyn-Coop. A scan of challenges agri-businesses face in engaging with smallholders leads into 5 main types of solutions:
- Research and innovation, e.g. SMS-based services; micro-insurance
- Upgrade smallholder production factors, e.g. facilitate access to phones, fertiliser or credit
- Inform, train and consult to transfer knowledge, e.g. market information, crop management or literacy training
- Agree on and enforce rules, e.g. agreements on standards and minimum purchases.
- Strengthen links within the value chain, e.g. improved logistics and distribution systems.
I had not viewed our BIF and IAP agribusiness projects with this categorisation before. Certainly they can be divided that way, though as ever boundaries blur in practice: innovative SMS and picture based services are being rolled out by mKRISHI in India; farmer access to fertiliser is being expanded by Cropserve in Zambia; knowledge transfer if being promoted by IDE Farm Agents in Mozambique; food standards are being strengthened by Nali Chilli Sauce; while strengthening the value chain is the focus of Guinness in Nigeria.
I like the categorisation because it recognises that farmers are not just producers in a value chain (selling produce) or just consumers (buying inputs). They are both. This distinction is fundamental to other inclusive businesses but problematic in agribusiness. If there is anything missing it is perhaps an overall headline about enabling farmers to access markets and value addition, which is certainly the headline in the BIF and IAP portfolios, as market access in turn unlocks finance, inputs, investment, and incentives to oil the various elements in the chain.
For a business already active, it doesn’t matter where you get categorised, but an open-minded entrepreneur facilitator or consultant will no doubt find it useful to scan across the categories for inspiration.
The report provides short but good case studies for each of these solutions and more, which ground it in reality and compensate for the number of pages (84). Cases go from the African Cashew Initiative to Yayasan:Yayasan Tumbuh Mandiri in India, with plenty more from the well-known names ( Cargill, Jain, Kraft , Olam, Unilever) along with a few more homegrown initiatives.
It’s ambitious in seeking to cover the spectrum of challenges, solutions and countries, so most readers are likely to scan quickly for good ideas then dip deeper into sections most relevant to them. But the authors approach helps draw you in, converting the standard approach of good analysis (mapping challenges, solutions, and good practice) into an agricultural framework.: discover (the opportunities), assess, (the challenges) plant (solutions), nurture (relationships), and harvest (results My copy even came by post with a seed and potting tablet to nurture, and remind me of this cycle.
The section on nurturing relationships with farmers, businesses and others in the environment is particularly important reminder of the processes involved in pursuing any of the solutions. As BIF and IAP projects working with smallholders also demonstrate, the innovation requires in these approaches is not just in the technology or finance, but the new relationships that are built to make the value chain work.
Growing Business with Smallholders. A Guide to Inclusive Agribusiness (November 2012) is published by GIZ. It is written by Christina Gradl, Christina Kükenshöner, Juliane Schmidt, Christiane Ströh de Martínez.
Each monthly Editor's Choice can be viewed here.