For projects that work with private sector partners, we often work at the value chain level to promote trade between groups of producers needing new or improved trade and companies needing more or improved supplyWhen working in value chains, it is important to understand the actors and how the create assets for your work or challenges. Who are your key partners? What are their goals and constraints? Who do we need to recruit as a partner? Who is neutral that just needs to be informed? Who is a blocker that needs to be managed?There are many different entry points – starting with farmers and looking for a buyer. Starting a with new intermediary. Starting with a lead firm. In the cases of working with a business partner, a good first step is to really understand what the product opportunity is. What are the requirements – cost, quality, etc – that the farmers need to meet to be successful? Is the farmer story important to the product proposition?Next is understanding the capacity gap between the current farming and processing performance and what would be needed to be successful. What investments are needed? Is this a reasonable and achievable gap? How can the partners work together on this?Next is the structure of the trading relationships. It is not just about a sourcing opportunity – but an inclusive, durable, and fair one. Looking to the business model principles, are there needs and opportunities around collaboration? Market linkages? Transparency and risk sharing? What services are needed by the farmers and the intermediary?A typical weak point in inclusive business models is the “specialized intermediary” – the business that is sourcing from small scale producers and having to meet the souring requirements of modern fast moving supply chains. Understanding whether the requirements can be met, and whether the basica business model -- including he costs of services to promote and sustainable inclusive – can be carried by the value proposition is critical.Finally to increase impact and reduce risk means investment at the household level. A single value chain should be one of a number fo strategies…
NEED SLIDE: Objective_ buildsustainabletradingrelationships. How: Discover, design do. (use photo)
descriptions and outcomes.
LINKING WORLDS: EXISTING FRAMEWORKSSource: Seville, Don. Sustainable Food Lab for Linking World Conference.
“OUR GOAL is not to link the poorest farmers to the most demand market but to invest in moving farmers up and to make markets more accessible? Can we help companies Can we help farmers source down a level? move up a level? Can benefits trickle down? 1-2% are the commercial farmers (2% of farmers account for 50% of maize sales) Can they compete with 3-15% are regularly selling into markets commercial? Can we integrate VC with food 20-30% are occasionally connected to security and local markets? markets and are food buyersLow barrier cash crops, transition 40-50% are subsistence strategies, basic agronomic producers, buy in food, improvements? get most cash from off farm work.Source: Seville, Don. Sustainable Food Lab for Linking World Conference.
ELEMENTS FOR INCLUSIVE BUSINESS MODELS Capable farmers Willing buyers (skills, capacity & (private sector organization) policies) Enabling environment (public / donor policies) NEW BUSINESS MODELS FOR SUSTAINED TRADING RELATIONSHIPSAdapted from www.regoverningmarkets.org by CIAT
THIS TOOLKIT IS DESIGNED TO help a group of market chain actors and stakeholders:Discover opportunities Implement, validate Produce results that arefor innovation. and evaluate equitable, viable, feasible interventions that are , durable and inclusive. inclusive of small- holders. Facilitate a systematic learning process.
the market on critical the existing the change the innovation test, adjust, i and measurechain points in business strategy prototype mprove the results and the chain model interventions impacts
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