I’m part of the BIF team in Imani Malawi. I have a particular interest in value chain assessment, market development and environmental sustainability in Malawi. I therefore jumped at the chance to get involved in a BIF cost-sharing project involving these interests - the MicroVentures Programme; part of the work of Microloan Foundation here in Malawi. A summary of the MicroVentures project can be found on http://businessinnovationfacility.org/page/microventures-malawi.
My work in the project involved conducting a value chain assessment of Irish potatoes, tomatoes and onions in the MicroVentures focal area of Mzimba District in Northern Malawi. This assessment, with a strong market focus, was the first step towards designing an innovative market linkages model for farmers receiving loans for agri-business from Microloan Foundation. The assessment was critical because I strongly believe that before a programme can be designed the implementing context must be thoroughly understood. The assessment is available to download on http://businessinnovationfacility.org/forum/topics/value-chain-anal.... What I enjoyed most about this piece of work was the opportunity to get right down to the producer level and really understand what was going on in the critical trading centres. Most value chain work I have undertaken has been at the national level and often localised and unique supply and demand patterns can be obscured.
The MicroVentures programme aims to go beyond micro-lending mechanisms to support individual borrowers, and look at the markets where those borrowers sell their products. Many of you will be familiar with the same problem in other countries: how can small producers access the market, or rather the markets beyond the first trader or nearest town? It could be said that there is a hierarchy of markets, with the very first trader in the chain being the first tier, and markets further afield becoming increasingly difficult to access. MicroVentures aims to work directly with smallholders but also the traders and supermarkets. It is a common misunderstanding that greater returns can be delivered to the producer by cutting out the informal middlemen, however this report has found that the trading system is vital for connecting the fragmented producers and holds most of the ‘power’ in the value chain. It is clear that the model for the market linkage must in this context look to incorporate and reform the trading system, rather than bypass it, in order to be viable and effective.
How can we improve the supply chain leading to high value products? It’s an increasingly enticing question as internal markets change with more value-added products in supermarkets, restaurants/hotels, and so on. The crucial factor for these three commodities is understanding the specifications of the market and ensuring the mechanisms are in place to deliver according to these demands.
I would welcome your thoughts – I know Andrew K in Zambia will recognise many of these challenges as well as the huge potential for new market development, but who else has done something similar? What successes have been seen? Let me know –Georgina
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