Writing A Descriptive Job Description
Title of the Job
· Be as specific as possible (if feasible, avoid non-descript titles such as “associate”)
· Be sure to include job’s level/grade, if applicable (junior, senior, etc.)
· Use gender-neutral language (“fire fighter” not “fireman”)
Identifying Information
· Company Name & Function or Department
· Location
· To whom the job reports
· Salary range (optional)
General Purpose (Job Summary)
· A brief overview of the job (3-5 sentences); why the job exists, what the work involves, responsibilities, tools used, amount of autonomy
*Helpful Hint: this is usually easiest to do last, but should always be presented early in the finished product)
Core Duties & Responsibilities
· In order of importance, list the essential duties of the job (typically 8-10)
· “Core duties & responsibilities” are those that must be performed in order to accomplish successful job performance
· Include general work activities and responsibilities (use tasks sparingly for purposes of clarification)
· Provide some indication of the amount of autonomy and judgment that must be exercised as part of the job
· Provide some indication of the complexity of the job
· Avoid functions that only happen irregularly (e.g., “takes over for manager if he/she is absent)
· Be sure to include any physical requirements, such as weight to be lifted, etc. (if applicable)
· Often the phrase “other additional duties, as requested by the supervisor” is used to avoid the situation of people saying “that’s not in my ob description…”
*Helpful Hint 1: Some considerations as to whether something is “core” or essential:
- Does the position exist to perform the function?
- Is the time spent in performing the function significant?
- If the function is not performed, are there serious consequences for the company?
- Have past or present employees actually performed the function as part of the job?
Work Role Interactions
· Indicate (by job title) with whom the position would have regular (day-to-day) contact, excluding immediate supervisors & mangers) – this should include stakeholders both inside & outside the org.
· The nature of the contact (role interaction) should be very clear from the previous section, if not provide more detail
KSAOs (Job Specification)
· List the essential knowledge, skills, abilities, and other characteristics (e.g., work styles such as dependability) that are needed for successful job performance
*Helpful Hint: Provide a brief description of the KSAOs when necessary; not everyone knows what “teamwork skills” or “a customer-focus” means
Quantitative Dimensions (Optional)
· Describe the job in terms of financial accountability/results (operating budget, authorization limits, sales volume, etc.)
Experience, Education, Training, & Misc. Requirements
· Indicate minimum work experience (both type and length)
· Indicate educational requirement (degree and specialization, if possible)
· Describe any special certification or other ...
Micro-Scholarship, What it is, How can it help me.pdf
Writing A Descriptive Job DescriptionTitle of the Job· Be as s.docx
1. Writing A Descriptive Job Description
Title of the Job
· Be as specific as possible (if feasible, avoid non-descript titles
such as “associate”)
· Be sure to include job’s level/grade, if applicable (junior,
senior, etc.)
· Use gender-neutral language (“fire fighter” not “fireman”)
Identifying Information
· Company Name & Function or Department
· Location
· To whom the job reports
· Salary range (optional)
General Purpose (Job Summary)
· A brief overview of the job (3-5 sentences); why the job
exists, what the work involves, responsibilities, tools used,
amount of autonomy
*Helpful Hint: this is usually easiest to do last, but should
always be presented early in the finished product)
Core Duties & Responsibilities
· In order of importance, list the essential duties of the job
(typically 8-10)
· “Core duties & responsibilities” are those that must be
performed in order to accomplish successful job performance
· Include general work activities and responsibilities (use tasks
sparingly for purposes of clarification)
· Provide some indication of the amount of autonomy and
judgment that must be exercised as part of the job
· Provide some indication of the complexity of the job
· Avoid functions that only happen irregularly (e.g., “takes over
for manager if he/she is absent)
· Be sure to include any physical requirements, such as weight
2. to be lifted, etc. (if applicable)
· Often the phrase “other additional duties, as requested by the
supervisor” is used to avoid the situation of people saying
“that’s not in my ob description…”
*Helpful Hint 1: Some considerations as to whether something
is “core” or essential:
- Does the position exist to perform the function?
- Is the time spent in performing the function significant?
- If the function is not performed, are there serious
consequences for the company?
- Have past or present employees actually performed the
function as part of the job?
Work Role Interactions
· Indicate (by job title) with whom the position would have
regular (day-to-day) contact, excluding immediate supervisors
& mangers) – this should include stakeholders both inside &
outside the org.
· The nature of the contact (role interaction) should be very
clear from the previous section, if not provide more detail
KSAOs (Job Specification)
· List the essential knowledge, skills, abilities, and other
characteristics (e.g., work styles such as dependability) that are
needed for successful job performance
*Helpful Hint: Provide a brief description of the KSAOs when
necessary; not everyone knows what “teamwork skills” or “a
customer-focus” means
Quantitative Dimensions (Optional)
· Describe the job in terms of financial accountability/results
(operating budget, authorization limits, sales volume, etc.)
Experience, Education, Training, & Misc. Requirements
· Indicate minimum work experience (both type and length)
· Indicate educational requirement (degree and specialization, if
3. possible)
· Describe any special certification or other training that is
necessary (CPA, CPR, EMT license, etc.)
Contact Information
· Where/who/how to send resume or apply
· Specify how further contact will occur (“don’t call us, we’ll
call you” – but in a more tactful way that indicates a general
process)
S w
905M56
CARE KENYA: MAKING SOCIAL ENTERPRISE
SUSTAINABLE
Tom Ewart prepared this case under the supervision of
Professor Tima Bansal solely to provide material for
class discussion. The authors do not intend to illustrate either
effective or ineffective handling of a managerial
situation. The authors may have disguised certain names and
other identifying information to protect
confidentiality.
Ivey Management Services prohibits any form of reproduction,
storage or transmittal without its written
permission. This material is not covered under authorization
5. farmers from
falling back into poverty.
KENYA, KIBWEZI AND POVERTY
Although Kenya had the largest economy in East Africa, 55.4
per cent (17.1
million people) of the population lived below the extreme
poverty line (US$1 per
day) in 2001, up from 48.8 per cent in 1990. There were large
income disparities
between the country’s richest and poorest residents, and
between rural and urban
areas (see Exhibit 1). Life expectancy at birth was 45 years, the
adult literacy rate
For the exclusive use of f. zaghabah, 2020.
This document is authorized for use only by fouad zaghabah in
TGM 487 Global Entrepreneurship (SP20) taught by Eva
Vazquez, Arizona State University from Jan 2020 to Jul 2020.
Page 2 9B05M056
was 84 per cent and gross domestic product (GDP) per head at
purchasing power
parity was US$1,020 per year. Kenya ranked 148th on the
United Nations 2002
Human Development Index. By contrast, Canada ranked fourth
with a life
expectancy of more than 79 years, a 99 per cent adult literacy
6. rate and a GDP of
US$29,480 per year.
Kibwezi was nearly three hours by road to the southeast of
Nairobi. The Kibwezi
region was particularly poor and vulnerable to economic and
climate fluctuations.
More than 70 per cent of the region’s 900,000 residents did not
have secure access
to food, compared to the national average of 56 per cent. Most
people relied on
assistance from government and development agencies. While
many aspired for
more, they lacked the economic means to climb out of poverty.
Kibwezi could not
attract major investments because of its lack of access roads,
electricity and other
infrastructure; low literacy rates; low access to rural services,
such as banking and
health; and poor rainfall patterns typical of arid and semi-arid
areas.
AGRICULTURE SECTOR
The agriculture sector contributed 25 per cent to Kenyan GDP
in 2003, and related
agricultural services contributed another 25 per cent. More than
17 per cent of the
labor force in the formal sector was employed in agriculture;
however this figure
understated the real value of agriculture in Kenya. More than
75 per cent of the
total Kenyan labor force worked in the informal economy,
outside of legal,
regulatory and tax regimes. The Kenyan informal economy was
7. almost totally
based on agriculture.
Most of the rural poor were smallholder farmers, who depended
on subsistence
agriculture and, failing that, on food safety nets. They had a
poor resource base,
were isolated due to poor infrastructure and had poor access to
markets,
technology, information, capital, and private and public sector
services. As a
result, the rural poor rarely participated in the formal economy.
When Kenya gained independence from Great Britain in 1963,
horticulture (the
production of fruits, vegetables and flowers) represented 0.3 per
cent of the
country’s total export value.1 By 2003, this number had reached
26 per cent.2 This
success has been attributed to Kenya’s comparative advantage
in its year-round
equatorial climate, competitive cost of labor, proximity to
export markets in the
European Union (EU) and Middle East, strong private sector,
access to good air
cargo facilities and simple export documentation procedures.3
The recent growth
1Neil McCulloch and Masako Ota, Export Horticulture and
Poverty in Kenya, ISD Working Paper 174,
Institute of Development Studies, University of Sussex,
Brighton, U.K., 2002.
2Economist Intelligence Unit, Kenya Country Profile 2004, The
Economist Intelligence Unit, London, U.K.,
2004, p.68.
8. 3U. Feldt, Sector Study of Horticultural Export Sector in
Kenya, FKAB Feldt Consulting for USAID, 2001.
For the exclusive use of f. zaghabah, 2020.
This document is authorized for use only by fouad zaghabah in
TGM 487 Global Entrepreneurship (SP20) taught by Eva
Vazquez, Arizona State University from Jan 2020 to Jul 2020.
Page 3 9B05M056
was driven by U.K. supermarket chains, which purchased 53 per
cent of Kenya’s
fruits and vegetables.
However, the Kenyan horticultural sector was facing
considerable changes. First,
the global trend towards market liberalization had increased
competition for trade
and finance. Second, the U.K. supermarkets –– which had
driven much of the
sector’s growth –– were demanding large investments in pre-
packaging facilities
and labeling programs. Third, rigid international accreditation
standards and codes
of practice (such as EurepGAP and Good Agricultural Practices)
were threatening
to increase farmers’ costs. These included sanitary and
phytosanitary standards,4
maximum residue levels for pesticides, product labeling to track
products from
exporters to farmers, and higher environmental and ethical
9. standards.
As a result of these changes, exporters were contracting from
large farmers rather
than smallholders, who lacked the technical expertise and
investment capital to
meet these international standards. Smallholder farmers
declined further into
poverty because they were forced to sell to more accessible, less
lucrative markets.
Consequently, in recent years, the rural poor had started to
migrate to urban areas
where they often lived in slums.
MUTULU MUTHOKA — A SMALLHOLDER FARMER
Mutulu Muthoka (see Exhibit 2) was one of REAP’s most
enterprising smallholder
farmers. He worked in the Kwakyai Rural Sacco, a collective of
more than 300
smallholders, 15 kilometres outside of Kibwezi. Mutulu lived
with his wife and
children in a small house made of intertwined branches and
mud. His two acres of
land produced sufficient food to feed his family.
Before REAP, Mutulu planted two crops of maize every year
during the two rainy
seasons. He harvested and dried the maize to feed his family.
When he was not
working the fields, there was little to do. When the rains did
not come, he relied
on assistance from the government and non-governmental
organizations (NGOs).
10. In a good harvest, Mutulu was able to sell his surplus maize at
the local market.
With the proceeds, he was able to improve the efficiency of the
farm. Before
REAP, Mutulu was saving to buy a pump that would allow him
to lease land near
a perennial water source and produce three to four crops of
maize every year. He
hoped to grow different crops and sell them in different
markets. Mutulu’s only
sales channel was through brokers, who took advantage of him
because he had no
information on market prices, nor any alternative options. He
did not trust his
brokers, and yet had to rely on them because of his inconsistent
product quality.
Despite his entrepreneurial zeal, Mutulu made less than US$2
per day.
4The prefix phyto means “plant-based.” These standards were
designed to protect the health of humans,
plants and animals.
For the exclusive use of f. zaghabah, 2020.
This document is authorized for use only by fouad zaghabah in
TGM 487 Global Entrepreneurship (SP20) taught by Eva
Vazquez, Arizona State University from Jan 2020 to Jul 2020.
Page 4 9B05M056
His wife collected water, prepared food and raised the children.
11. The children
tended the family’s small animal stock, which consisted of a
dozen or so goats and
chickens. In 2003, primary school fees were eliminated, and
since then, Mutulu’s
children attended primary school when they were not helping
with the harvest.
CARE INTERNATIONAL
CARE International (CARE) was a non-political, non-religious,
global network of
humanitarian organizations committed to fighting poverty. It
was founded in 1946,
in the wake of the Second World War.
In 2005, the CARE network included 12 lead members ––
including Canada ––
and country offices in more than 60 developing countries.
CARE’s mission was to
serve individuals and families in the poorest communities in the
world, promoting
innovative solutions and lasting change by strengthening
capacity for self-help,
providing economic opportunity, delivering relief in
emergencies, influencing
policy decisions at all levels and addressing discrimination in
all its forms. The
CARE network employed more than 12,000 people, and
managed 800 programs
that assisted more than 45 million people every year.
CARE Canada operated projects in 48 countries and was the
lead member
responsible for coordinating CARE’s work in Cameroon,
12. Colombia, Cuba, East
Timor, Indonesia, Jamaica, Kenya, the Russian Federation,
Zambia and
Zimbabwe. It had a budget of Cdn$179 million in 2003, most of
which came from
federal governments; multilateral institutions, such as the World
Bank, the United
Nations and the International Fund for Agriculture and
Development (IFAD); and
from other CARE lead country members. Since 1968, CARE had
managed
development and humanitarian projects in Kenya in the areas of
primary health
care, HIV/AIDS, small economic activity development,
reproductive health, and
agriculture and emergency response.
CARE Kenya
In 2004, CARE Kenya employed approximately 300 people and
had a budget of
nearly US$14 million. The agency attracted socially minded
employees, who were
often educated in social sciences. CARE staff had a reputation
for excellent
community engagement and mobilization. CARE staff was paid
on a nonprofit
compensation model, which rewarded process rather than profit
–– staff was paid
for fulfilling the mandate for aid, not trade.
For the exclusive use of f. zaghabah, 2020.
13. This document is authorized for use only by fouad zaghabah in
TGM 487 Global Entrepreneurship (SP20) taught by Eva
Vazquez, Arizona State University from Jan 2020 to Jul 2020.
Page 5 9B05M056
George Odo
George Odo (see Exhibit 2) was the senior manager in charge of
CARE Kenya’s
commercial sector development projects. He hadn’t always
worked in the
development sector. After his education in finance and
accounting, he had worked
in the private sector and as a financial accountant for the Office
of the President.
George’s grandfather was a subsistence farmer, who had been
determined to
educate his children and allow them to escape the poverty of
smallholder farming.
In 1999, while consulting for a large, commercial export farm,
George began to
question conventional wisdom that only large farms could
compete for foreign
contracts. George joined CARE Kenya in 2000 to manage the
REAP project, and
had strong opinions about development:
The best way to help smallholders achieve their development
agenda is to help them get access to markets because doing so
14. will
increase their incomes, which then impacts their lives.
Development Strategy
CARE’s development strategy had evolved over time. In what
CARE called the
First Wave of international development, CARE and its
overseas volunteers
undertook small-scale projects, such as building schools. These
projects were
largely funded by individual charitable donations. While they
were often very
successful, they were not sufficient to address the multitude and
magnitude of
problems of the world’s poor. As well, direct subsidies could
make recipients
dependent on development agencies.
The Second Wave consisted of large-scale, poverty-reduction
projects funded by
governmental and multilateral organizations. These projects
provided much
needed infrastructure, for example large irrigation systems, and
had significant
macroeconomic impact. However, grants (as the principal form
of financing) did
not often lead to self-sustaining delivery models, and they were
susceptible to
bureaucratic barriers and shifting donor priorities.
The micro-finance revolution began what CARE called the
Third Wave, a market-
based approach to development. Micro-financing proved that
15. poverty-eradication
projects could be sustainable and could operate on commercial
principles. Micro-
financing involved lending small amounts of money, typically
to small groups of
poor entrepreneurs –– a market that the large financial
institutions deemed too
risky. Lending to groups, often women, lowered the default
ratio. Beyond micro-
financing, the Third Wave sought to address structural problems
that suffocated
entrepreneurship in economically developing countries. These
barriers to
entrepreneurship included no access to credit, burdensome
regulatory
For the exclusive use of f. zaghabah, 2020.
This document is authorized for use only by fouad zaghabah in
TGM 487 Global Entrepreneurship (SP20) taught by Eva
Vazquez, Arizona State University from Jan 2020 to Jul 2020.
Page 6 9B05M056
environments and negative market conditions (such as local
monopolies). These
barriers inhibited poor residents from entering the formal
economy, which reduced
tax revenues and weakened the government, giving rise to what
CARE called the
“missing middle” –– a relative absence of the small- and
medium-sized enterprises
16. that often fuel economic growth through innovation and high
rates of employment.
THE RURAL ENTERPRISE AND AGRIBUSINESS
PROMOTION (REAP) PROJECT
Through education and through infrastructure development,
CARE’s agricultural
projects in Kenya had previously helped smallholders improve
crop yield and
efficiency by addressing the mix of inputs into their
horticultural processes.
George explained:
This was a good development model, but not a good commercial
one because it would have collapsed when donor preferences
shifted and the project had to close.
In the late 1990’s, approaches to rural development began to
change.
Development agencies, such as CARE, were unused to
philosophies like “markets”
or the “private sector.” However, CARE began to analyse the
markets for cash
crops to determine why subsistence farmers were not able to
take advantage of
them. It concluded that numerous structural barriers impeded
farmers from
entering the formal economy and selling their goods.
In late 1999, with funding from the International Fund for
Agricultural
Development (IFAD), CARE USA, and the Canadian
17. International Development
Agency (CIDA), CARE started REAP –– a market-driven
horticultural project
targeting smallholder irrigation farmers living below the
poverty line in Kibwezi,
Kenya. The project intended to answer the question: can a
market-driven,
smallholder agriculture model be commercially viable (i.e. not
be subsidized by
CARE) and demonstrate development impact (i.e. increase
farmers’ incomes)?
CARE took a multi-step approach. First, CARE established a
small consultancy,
which it called the Central Management Unit (CMU). The CMU
engaged the
farming communities and learned that private sector exporters
were often
frustrated working with smallholders because of the poor and
inconsistent quality
of their products. The CMU gave farmers credit to lease blocks
of land of at least
30 acres, close to water and that had not been primarily used for
agriculture. Then
the CMU assigned groups of 20 to 30 farmers to parcels of land,
called Production
Units (PUs). Farmers then paid for the legal incorporation of the
PUs and obtained
share certificates as either limited liability corporations or co-
operatives. It was
important to legally recognize the PUs in order to give the
private sector
confidence in doing business with them, as the PUs would be
subject to a legal and
For the exclusive use of f. zaghabah, 2020.
18. This document is authorized for use only by fouad zaghabah in
TGM 487 Global Entrepreneurship (SP20) taught by Eva
Vazquez, Arizona State University from Jan 2020 to Jul 2020.
Page 7 9B05M056
regulatory framework. The farmers had owned their land before,
but had never
shared ownership of a company.
Next, CARE negotiated contracts with private sector exporters
that sold primarily
to U.K. markets. The contracts specified the buyers’
expectations for type, quality
and quantity of produce needed. Subsequently, CARE prepared
production and
business plans with the farmers to show them the link between
their production
and the market. Farmers’ profits were based on their ability to
grow quality
produce as specified in the contract and control their costs, of
which a large portion
went to REAP through loans for labor, seeds, fertilizer and
chemicals.
CARE’s CMU offered farmers micro-credit and working capital
loans for inputs,
term financing for irrigation equipment, market access and
technical training in
agronomy. The farmers paid a fee of 10 per cent of their gross
profit for these
19. support services. The CMU provided farmers with inputs within
two weeks of
ordering, and paid them every month, once paperwork had been
signed in Nairobi.
George had expected that the interest from the loans and the
management fees
would cover the expenses of the CMU and, thus, the REAP
project. CARE had
planned that once REAP was profitable, it would be left to
operate as a self-
sustaining unit.
Private Sector Exporters
CARE had arranged for the smallholders to sell their produce to
five horticulture
exporters, all privately owned, in Kenya: East African Growers,
Vegpro Kenya
Ltd., Kenya Horticultural Exporters, Frigoken and Mbogatuu.
East African
Growers was the dominant player in the industry with annual
sales of
approximately US$50 million. Vegpro Kenya Ltd. had sales of
approximately
US$40 million. Kenya Horticultural Exporters and Frigoken
were similar in size to
Vegpro Kenya Ltd. Mbogatuu was the smallest company of the
five.
The major exporters often procured their produce from two
sources: large-scale
commercial farms that they owned and operated, and out-
growers (independent
contractors), many of whom were smallholders. The large
20. commercial farms had
extensive agronomic expertise. They focused their operations on
high-margin
products, such as cut flowers, in specific geographies, which
created gaps in the
supply of certain products, such as baby corn, okra, ravaya and
karella. These gaps
were filled by out-growers. Many smallholders operated in
locations that favored
some crops, resulting in high yields. Despite this
interdependence, the out-growers
did not generally have reliable relationships with the exporters.
Buyers would
often show up sporadically and buy only the crop they wanted
and negotiate low
prices.
For the exclusive use of f. zaghabah, 2020.
This document is authorized for use only by fouad zaghabah in
TGM 487 Global Entrepreneurship (SP20) taught by Eva
Vazquez, Arizona State University from Jan 2020 to Jul 2020.
Page 8 9B05M056
Competition was tight among the exporters because there was
very little upward
movement in prices and yet costs increased every year. The
exporters constantly
struggled to achieve high yields and hold costs flat on their
large-scale commercial
21. farms and through the out-growers.
Export companies began competing for the privilege of working
with CARE on
the REAP project because farmers who worked with CARE had
better quality
produce and were more reliable than those who didn’t. REAP’s
biggest private-
sector partner was Vegpro Kenya Ltd.
Vegpro Kenya Ltd.
Vegpro Kenya Ltd. (Vegpro) was founded in 1979 and had since
grown into one
of the largest horticultural buying and growing companies in
Eastern Africa.
Vegpro grew 80 per cent of its production on its large, wholly
owned, commercial
farms and sourced the rest from smallholders. Vegpro relied on
smallholders for
specialized crops, but demanded that they be of consistent high
quality and
available in sufficient quantities through the year. The company
had sales of
US$40 million in 2003, selling primarily to supermarkets in the
United Kingdom.
From 2003 to 2004, Vegpro had contracts with REAP
smallholders worth more
than KSh63 million (Kenyan Schillings).5
Much of Vegpro’s growth was attributed to its ability to meet
changing customer
needs, including the increasing demand for more value-added
products, such as
pre-packaged vegetables. Vegpro worked closely with customers
22. to develop new
products and presentation formats that suited their needs.
Vegpro had dedicated agronomic personnel in production units
and in a central
technical department. They oversaw product testing, grower
audits, EurepGAP
accreditation, pest management and environmental management
programs.
Without these technical experts, contracts with the demanding
European markets
would have been lost.
Vegpro processed all products in modern, air-conditioned
facilities located in the
cargo area of Jomo Kenyatta International Airport in Nairobi.
Without the
facilities, Vegpro would not have been able to maintain a
continuous cool chain to
control the quality of the delivered product. Every day, more
than 60 tonnes of pre-
packaged and prepared vegetables were flown to European
markets.
Vegpro valued staff welfare and environmental protection. It
worked with the
Ethical Trading Initiative to ensure staff welfare standards, and
developed
environmental codes of conduct. The company provided all staff
with free
5 US$1 = KSh79
For the exclusive use of f. zaghabah, 2020.
23. This document is authorized for use only by fouad zaghabah in
TGM 487 Global Entrepreneurship (SP20) taught by Eva
Vazquez, Arizona State University from Jan 2020 to Jul 2020.
Page 9 9B05M056
transport, basic medical treatment and free lunches, and
environmental
management plans were in place for each production site.
By 2002, REAP’s smallholders produced approximately 50 per
cent of Vegpro’s
Asian vegetables, although this quantity made up less than five
per cent of
Vegpro’s total sales.
REAP’S SUCCESSES AND CHALLENGES
The REAP project had been a success but had also faced
challenges. On the
upside, REAP demonstrated that very poor farmers, organized
as limited liability
companies, could enter the supply chain; establish contracts
with, and gain credit
from, the private sector; and that they could build their
agronomic and managerial
capacities to grow sophisticated vegetables, all of which pointed
to successful
economic development. By 2003, 137 participating households
earned an average
of US$100 per month, and 413 households earned US$40 per
24. month, up from
US$12 per month before REAP. Farmers could afford to school
their children,
buy medicines and re-invest in personal assets, thereby breaking
the cycle of
extreme poverty.
However, REAP had failed to be commercially viable. It had
been unable to
choose the right clients and staff, or to modify its bureaucratic
systems to be more
like a business and less like a non-governmental organization
(NGO). A business
entity could focus operations on efficiency rather than just
effectiveness.
From the smallholders’ perspective, REAP was successful
because it increased
farmers’ earnings by linking them to markets that they would
otherwise have been
unable to access. Mutulu expressed his gains in spiritual and
physical terms:
“When REAP started we thought mana [meaning help from
above] had come.” He
stood up with a chuckle and displayed his impressive round gut.
“And look at my
belly now!”
On the downside, while most of the PUs were making money,
the CMU had never
been profitable. The CMU costs were subsidized by donor
funding, which would
eventually come to an end. The CMU needed to be financially
sustainable for it to
continue providing services to the farmers. Some smallholders
were not showing
25. up for work, and there was occasional infighting. Contracts with
exporters were
not always fulfilled. For example, from October 2002 to
September 2003, REAP
farmers supplied only 30 per cent to 40 per cent of their
contracted volumes. The
CMU’s losses were absorbed by REAP through debt for which
CARE was liable.
REAP faced challenging performance-related issues when
farmers didn’t meet
their targets. Some farmers faced various barriers to being
successful
For the exclusive use of f. zaghabah, 2020.
This document is authorized for use only by fouad zaghabah in
TGM 487 Global Entrepreneurship (SP20) taught by Eva
Vazquez, Arizona State University from Jan 2020 to Jul 2020.
Page 10 9B05M056
entrepreneurs. While the competitive horticulture industry
would have cut them
out of the game, REAP could not easily abandon its clients.
CARE had a propensity for funding projects through grants. As
such, REAP’s
relatively loose lending criteria had resulted in loans that
exceeded their clients’
ability to repay. Not only did over-lending increase CMU’s bad
debts, it also
26. lowered farmer productivity.
Two upcoming issues especially concerned George. First, he
knew that in its
current structure, REAP would require continuous external
fundraising and that
donors would become increasingly difficult to secure. As such,
CARE’s
involvement in REAP would have to be scaled back in the near
future. Second,
George recognized that EurepGAP agricultural standards would
be extended and
intensified at the end of 2005. While the large export companies
were already
certified, no smallholder would be able to afford costly
integrated pest
management and tracking systems. For REAP to continue
beyond 2005 in its
current structure, it would need a huge injection of capital.
IMPROVING REAP
George Odo was determined to solve these problems and make
REAP sustainable.
We are continuously meeting in CARE, including annual review
forums for projects. Through these meetings, it was becoming
clear
that REAP had problems. Against our donor contracts, we were
achieving our targets. But against our market contracts, our
performance was below par.
George started by analysing REAP’s financial statements and
27. projections. Most of
the PUs were profitable after their first year of operation.
Exhibit 3 shows the
Profit and Loss Statement for the Wololo Wa Thange PU.
However, the CMU had
lost KSh12.5 million in 2002 and was only projected to make its
first, modest
profit of just over KSh1 million in 2006 (see Exhibit 4).
Stepping back, George wondered if a completely different
approach would be
necessary to make REAP commercially viable, without
compromising its
development agenda. He was confident that a market-based
approach to
development was necessary in order to address the severe
poverty problem in rural
Kenya.
For the exclusive use of f. zaghabah, 2020.
This document is authorized for use only by fouad zaghabah in
TGM 487 Global Entrepreneurship (SP20) taught by Eva
Vazquez, Arizona State University from Jan 2020 to Jul 2020.
Page 11 9B05M056
Exhibit 1
INCOME DISTRIBUTION IN KENYA
29. ot
al
In
co
m
e
Richest 20%
Middle 60%
Poorest 20%
Source: Economist Intelligence Unit.
For the exclusive use of f. zaghabah, 2020.
This document is authorized for use only by fouad zaghabah in
TGM 487 Global Entrepreneurship (SP20) taught by Eva
Vazquez, Arizona State University from Jan 2020 to Jul 2020.
Page 12 9B05M056
Exhibit 2
PHOTOS OF SELECTED REAP STAKEHOLDERS
30. Source: Casewriter and CARE Employee, Jesse Moore.
Mutulu Mathoka George Odo
For the exclusive use of f. zaghabah, 2020.
This document is authorized for use only by fouad zaghabah in
TGM 487 Global Entrepreneurship (SP20) taught by Eva
Vazquez, Arizona State University from Jan 2020 to Jul 2020.
31. Page 13 9B05M056
Exhibit 3
WOLOLO WA THANGE PRODUCTION UNIT
Profit and Loss Statements
(for the 12 months ended June 30, 2002 and 15 months ended
September 30, 2003)
(in KSh)
Hist 2003 Hist 2002
Turnover 2,290,871 917,436
Less: Cost of Sales 844,713 545,961
Gross profit/(loss) for the year 1,446,158 371,475
Less: Expenses
Depreciation 414,650 118,638
Operational Costs 441,401 438,776
Management Fees 144,616 -
Total 1,000,667 557,413
Profit (Loss) before Finance Costs 445,491 (185,938)
Finance Costs 501,162 308,035
Adjustment to Loans (608,854) -
Profit (Loss) after Finance Costs 553,183 (493,973)
Taxation 553,183 (493,973)
Dividends Paid 232,000 202,000
32. Profit/(Loss) 321,183 (695,973)
Source: Company files.
For the exclusive use of f. zaghabah, 2020.
This document is authorized for use only by fouad zaghabah in
TGM 487 Global Entrepreneurship (SP20) taught by Eva
Vazquez, Arizona State University from Jan 2020 to Jul 2020.
Page 14 9B05M056
Exhibit 4
PROFIT AND LOSS STATEMENT FOR THE CENTRAL
MANAGEMENT UNIT
(in KSh)
Hist Hist Proj Proj Proj
2002 2003 2004 2005 2006
Revenues
Interest 1,237,564 2,970,847 3,507,132 3,605,000
3,408,000
Management fees - 42,158 243,144
3,799,677 5,085,808
Total 1,237,565 3,013,006 3,750,277 7,404,677 8,493,808
34. 588,141 719,708 1,391,104 529,005 606,815
EBT (12,543,295) (9,214,060) (7,464,762) (1,787,800)
1,091,947
Taxes - - - - -
Net Income (loss) (12,543,295) (9,214,060) (7,464,762)
(1,787,800) 1,091,947
Source: Company files.
For the exclusive use of f. zaghabah, 2020.
This document is authorized for use only by fouad zaghabah in
TGM 487 Global Entrepreneurship (SP20) taught by Eva
Vazquez, Arizona State University from Jan 2020 to Jul 2020.