In the wise words of Winston Churchill, ‘If you mean to profit, learn to please’. Essentially, learn your market, know your product and ensure your consumers get value for their money. This is the baseline of a strong, profitable agricultural business – your quality and your consumers’ satisfaction.
Agribusiness revenue accumulates to more than double the investments made, making it one of the most profitable businesses to venture into. Both investors and farmers are assured great returns if their market is satisfied.
Smart business is dependent on a number of things. For one, scale matters. The size of income is dependent on the extent of land cultivated, the quality of soil, access to irrigation and nearness to the market. Agribusiness is not a solo operation. You can have one of two strengths: farming or marketing. As a farmer, you would seek contract farming that would essentially take care of any market risk. In turn, gaining this contract would enable you to earn more by devoting yourself to quality as well as productivity. Moreover, acquiring crop insurance can mitigate weather risks.
The right marketers would have well-analysed research indicating specific retailers to get involved with. Of note, retailers are preferable to wholesalers because the latter have standardized prices throughout the year. In order to ensure rightful investment returns and claim the title of a smart agripreneur, we take a step back and pay attention to the goal – making large, if not sufficient profits.
One business that aids smallholder farmers is Selina Wamucii – a mobile-driven business founded in 2015 that has capitalised on the large agricultural population in Kenya. Their aim is to inspire smallholder farmers by buying and grading produce from them then selling it to buyers and distributors globally. Selina Wamucii technology is independent of the internet and can be used on any mobile phone. Farmers dial a USSD code on their phones – similar to what they would do when buying data bundles – and send in their general information such as location, produce type, projected volumes and availability dates. The information is entered into a map maintained by Selina Wamucii. When they receive orders from their international clients or exporters, they coordinate fulfillment by purchasing produce from the farmers in their system. Once signed up, farmers also benefit from training on Good Agricultural Practices and access to extension services.
Selina Wamucii has achieved notable success in exporting quality produce from smallholder farmers to countries across Africa, Europe, Asia and the Middle East. They currently have over 3,000 smallholder farmers registered. Their platform significantly reduces inefficiencies in the export value chain, allowing farmers to make more and importers to reap the benefits of improved value for money. In May 2018, they won a $100,000 grant from Expo Live, a global innovation programme run by Expo 2020 Dubai.
So, which are you – farmer, marketer or both? What are your tips to thriving in agribusiness?
