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New Agriculturist: Focus on... Entrepreneurs in agricultural marketing
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Entrepreneurs in agricultural marketing

Agricultural marketing entrepreneurs link small farmers with other key players in the market chain (© Ueli Scheuermeier)
Agricultural marketing entrepreneurs link small farmers with other key players in the market chain
© Ueli Scheuermeier

Jacinta Namubiru is in the business of marketing. The network manager for AgriNet in Tororo, Uganda, Namubiru is part of Rural African Ventures Investment's (RAVI). This network of registered Transaction Security Service (TSS) agents operates throughout East Africa and through her network of 23 TSS agents Namubiru links groups of farmers to buyers. Her agents also operate Information Boards in villages and markets, which they use to advertise market intelligence, including market prices and trade alerts. She receives no salary for her work but earns a commission for brokering deals.

A recent deal illustrates how the system works. Namubiru received a phone call from a potential buyer, the Busia Child Fund in Busia, who needed groundnut seeds for their farmers' groups. They discussed the details and the buyer asked for a quotation. Namubiru then asked one of her TSS agents to find out the local prices from farmers and then used the official TSS form to calculate whether this would be a viable deal; would it enable the farmers to get a fair price and allow Namubiru and her agents to take a commission for their service.

"In such deals," says Namubiru, "after I have entered the details of prices, middle costs, buyer, seller and TSS agents involved, I send the completed TSS form by email to RAVI's business-to-business learning platform. There it is checked, registered and the deal can go ahead." This usually takes one day, and Namubiru can then explain the price to the buyer, based on a fair price to the farmers, plus middle costs for transport and unloading and a ten per cent commission for the network. The buyer then sends a Local Purchase Order to confirm the deal. "To source produce from farmers," Namubiru adds, "we advertise by sending SMS messages to our agents, who then place this trade alert on our AgriNet Information Boards, specifying the quality and quantity needed and the offer buying price."

Bringing in suppliers

TSS agents place trade alerts on AgriNet Information Boards (© Anne Dennig)
TSS agents place trade alerts on AgriNet Information Boards
© Anne Dennig

The Mari Agro Farmers' Association (MAFA) are an example of how potential suppliers respond to trade alerts. MAFA saw the trade alert and phoned Namubiru to say that they could supply the groundnuts needed by Namubiru's buyer. The TSS agent responsible for this farmers' group, checked the MAFA seeds and confirmed that it was the right variety of unshelled groundnuts and of good quality. He then supervised the tagging of the bags so that they were traceable back to individual farmers, loaded the three tons of groundnuts and gave the group chairman a cheque as cash-on-the-bag payment to his farmer members. When the seeds arrived in Busia, Namubiru and the District Agricultural Officer together supervised the checking of weight and quality, and within two hours the money from the buyer was in the TSS account. It had proved to be a good deal.

In such deals, once all the middle costs are paid, and Namubiru shares the commission between the TSS agents who are involved in the deal, the payment is sent directly to the farmer's phones through mobile money transfer. "The deals that we have done using TSS have given farmers 15-20 per cent better prices than those offered by middlemen," says Namubiru proudly. "Good quality produce, supplied by smallholder farmers, carefully checked and tagged for traceability and collected in sufficient bulk, ensures good prices from buyers."

Clearly, the savings made by the efficiency of the chain allow a win-win situation for farmers, buyers and network members alike. Total transparency of all prices paid all along the value chain is essential to achieve this effect and it is the task of the TSS network to ensure this, using modern information communication technologies (ICTs).

ICT changes in agricultural marketing

Changes that ICTs have made in agricultural marketing have helped entrepreneurs like Namubiru to enter into the heart of the marketing world, often taking on roles which would formerly have been filled by older more established entrepreneurs. RAVI has marketing experience in Kenya, Tanzania and Uganda, where they have found that young entrepreneurs are quick to take on new approaches and are eager to reap the benefits that mobile phones, computer software and the Internet provide. Members of RAVI's TSS network are exchanging their marketing experiences on the Internet peer-to-peer learning platform, Linking Local Learners. Using this platform they exchange experiences and are mentored on new methods of doing business.

ICTs have helped entrepreneurs like Namubiru to enter into the heart of the marketing world (© Anne Dennig)
ICTs have helped entrepreneurs like Namubiru to enter into the heart of the marketing world
© Anne Dennig

TSS agents have no difficulty sending and receiving SMS market data through information platforms such as Mobilinfo, while network managers put together databases of buyers and sellers, which help them to link producers and buyers effectively. As brokers and members of the TSS network, TSS agents do not need to buy and sell stock and so it is possible for them to get into business simply by having, time, energy, commitment to learn and a mobile phone. These young entrepreneurs, helped by ICT, are providing a new linking role in agricultural marketing for which they earn a commission and provide a professional service to the rural marketing chains. Their work makes these chains more efficient and also puts more money into farmers' pockets.

Written by: Anne Dennig, Jacinta Namubiru, Ueli Scheuermeier and Clive Lightfoot

Date published: May 2011


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