The ‘Veggie Kit’ for vegetable production was the first to fit the requirements for a suitable micro investment. Affordability was secured by offering investment increments below $10. Profitability of $25-150 in 3 months and payback of invested capital in about 2 months is a success story that travels by word-of-mouth.
A STRING OF SMALL VICTORIES
By investing her or his own savings, the farmer owns the success from the very beginning, and motivation to proceed is high. The natural extension is to add more of the same. One vegetable bed becomes three, and the doubling can take place as far as the local demand allows. Adding a micro poultry farm or fruit trees could improve the food security for the farmer’s own household while at the same time become another revenue stream that reduces the vulnerability of the business.
MASTERING THE LOCAL MARKET
Operating in a local market with immediate feedback on pricing and quality from customers is a valuable part of becoming a professional producer. Adapting to demand and being customer-oriented when expanding will prepare the farmer for competition and eventually specialisation. Competing to be best locally is the natural preparation for serving professional buyers.
QUALIFY FOR AGGREGATION
To reach a larger market, the farmer will need to produce products assessed and sorted by quality and become part of a supply chain that reaches urban consumers through professional buyers. When both stable quality and timely delivery can be demonstrated, prepayment from off-takers as well as insurance can be established at terms that benefit the farmer. To this end, a quality program will be an integrated part ofthe upgrade path, preparing the farmer by introducing quality management principles step by step.
Each investment kit is designed to provide a quick payback and to bring the farmer one step closer to being a professional and successful commercial producer. This is what we mean by ‘upgrade path’. Upgrade paths should focus on risk management and allow the farmer to build several independ- ent income streams. Each step should be based on profitable growth in a competitive environment. The roll-out team will offer incremental investment opportunities backed with know-how and quality management that help the farmer to avoid setbacks. As the ability to take more risk for a higher reward increases, the farmer may choose to diversify or specialise, depending on market opportunities.