SMALLHOLDER FARMERS AND BUSINESS
This report shows how pioneer companies and organizations have sustainably increased the income and livelihoods of millions of smallholder farmers around the world, by sourcing produce from them or selling products to them.
The study, prepared with the support of the Swiss Agency for Development and Cooperation, Danone Ecosystem Fund, responsAbility Investments AG and C&A Foundation, emphasizes smallholder farmers’ role as active partners rather than aid recipients.
By rigorously comparing the performance of 15 successful organizations worldwide, the study pins down some 13 deep, if not counter-intuitive insights on creating more wealth along the value chain, running cost-efficient operations and sharing value back with farmers sustainability.
For instance, contrary to the belief that only larger farms can be attractive business partners, the study demonstrates that some companies manage to increase their margins significantly when they start working with smaller farmers, along with diversifying their supply sources – a long-term competitive advantage.
Another chapter highlights how investing into farmers’ productivity, notably by transferring new technologies, can result in farmers’ doubling their net incomes in a year. Such investments may therefore be way more powerful than interventions that seek to redistribute wealth along the value chain (e.g. by removing middle men or providing higher prices to farmers).
The study also explains why farmers show so little interest in buying insurances against adverse events, even though they are often coined as ‘extremely risk averse’. And it gives insights on how to ensure farmers get insured nevertheless.
Lastly, the report details how to better execute smallholder farmers’ programs at lower costs. It closes by questioning the ability of cooperatives to bring more and better financial benefits to farmers.
Articles and blogs:
"Small Farmers and Business" - Asian Development Blog (Feb, 2016)
"Smallholder Farmers and Big Business: 5 insights from the field" - Next Billion.net (Dec, 2015)
"It makes business sense to work with and for smallholder farmers..." - The Practitioner Hub for Inclusive Business (Nov, 2015)
"How business can help smallholders?" - The guardian (Nov, 2015)
"Lesson learnt from 15 pioneer organizations working with 2 million small-scale farmers in over 15 commodities" - LinkedIn blog (Oct, 2015)
"Helping smallholder farmers achieve higher incomes to grow and thrive" - Business Fights Poverty (Oct, 2015)
"Best practices to transform lives, increase yields and make money" - The Practitioner Hub for Inclusive Business (Oct, 2015)