There’s a lot of buzz
around agribusiness, food security in Africa, why it’s cool to farm that even celebrities want to do it, government
officials, media personalities,
professors
in academia and seasoned entrepreneurs
are all talking about it tweeting a lot
too. But do you want to get on it because everyone is doing it? I guess no!
Do you want to do it because it will create
more jobs for our unemployed youths?
So as usual, everything
starts with an idea. What do you want to do? What will make me money and in
what duration? What doesn’t require so much time, isn’t labour intensive, maybe
costs to entry are low are some of the things one considers before choosing an
agribusiness venture. However agribusiness isn’t just leasing land and doing
some farming there, it’s not buying a greenhouse and doing some vegetables on
your idle plot, it’s also not just about quails. It’s neither about what the
media reports portray it not
sexy, cool for the softies reading this but actually a lot of work.
So here's my two cents on agribusiness.
When you think of starting
an agri-business venture, focus on spotting key trend lines, rather than
getting distracted by current headlines in the media dictating what the hot opportunities are. Think in terms of where
things are going in the near future, rather than get stuck on where they are,
who is doing what and how. If the late entrants to the quail craze thought about that, they'd be safe! The quail bubble for
example was fuelled by media reports which showed great potential, handsome
returns and great opportunities. Late comers, motivated by positive press then dived into quail farming without further analysis of the opportunity,
demand and supply forecasts, and how big the market was.
If you focus on headlines
as an entrepreneur, you’re already behind the curve, because you’re reading
what’s happening already what’s
making money. Zeroing in on trends, data, valuable insights and where they intersect, and
determining where they breakdown, will help you identify smart agri-business
opportunities. Finding success and scale means ensuring your next agribusiness idea
not only has merit, but can address a large enough market opportunity---unless you just want to do it to feed your family.
Kenya’s agricultural
sector is still not achieving its potential and growth targets. Despite the buzz, huge campaigns,
celebrity
endorsements, the
agribusiness sector –which comprises all businesses involved in agricultural
production, including farming and contract farming, seed supply, agrichemicals,
farm machinery, wholesale and distribution, processing, marketing and retail
sales has not taken off, well maybe on the runway at the moment.
Garbage strewn near the entrance to Wakulima market in Nairobi. |
Lets focus on some of the problems that we
need to solve to address food security in Kenya. Think about that for a moment. Viable businesses must fulfil a need in the market, serve it well consistently to remain profitable.
Back to agribusiness, the good thing here is you can do
it as proprietor, meaning you don’t have to do the actual farming--KYM kazi. You also don’t
have to do the tier one in agriculture which is primarily growing fruits,
vegetables, cereals or coffee e.t.c, keeping animals, insects or birds.
So what are some of the
opportunities for hard-working agripreneurs around?
1. 1. Value addition through agro-processing.
The amount of post-harvest
losses incurred by farmers are quite often at high and devastating levels due
to poor storage, preservation and transportation. Due to that farmers sell cheap
when there’s surplus and buy high when there’s shortage. Value addition could help
farmers get higher returns on their farm harvest through market linkages with
agro-processors. So instead of when there’s a milk glut we can convert our milk
to powder or any other product, sell at better prices and redistribute again
when there’s shortage. A cooler in village helps just as much to preserve milk
before delivery.
2. Technology innovations that improve farmers access to information,
inputs, services and markets that improve farming efficiency and output. The
opportunities here are immense. Can
mention a few examples here, m-farm, sokotext and more here.
3. Improved services and products (farm inputs) for farmers. Think
along “How do you cut out the middle man (regarding agricultural inputs) and
pass on the discount to farmers.
4. Training & education:
I love the discussions, sharing of
knowledge and insights on farming kenya Facebook
page. We also have iCow doing education in partnership with Safaricom but there
are opportunities here especially in the counties. There's also Shamba Shape Up [TV Program on Citizen TV]. I feel that what people need
more than anything else is some unbiased guidance, advice and some knowledge to steer their agribusiness ideas ahead. It's not just a capital challenge that hinders participation in this sub sector but also lack of knowledge. If you can think of something hybrid [Virtual and offline] to create, publish or distribute agribusiness education then make it available people will pay. Just make it
locally relevant, rural based if possible and do something. Thegrowthhub.comis running an incubator
for agribusiness startups. Think….think. Got knowledge you can share? Can you package it nicely and maybe in local languages? In multimedia ?
5. Financial solutions (credit, insurance, mobile transactions). This
is another huge opportunity for micro lenders, insurance and mobile solutions
offering farmers and buyers an easier way of transacting. There was also this brilliant idea of agribonds.
6. Business ideas that improve the logistical infrastructure towards
farmers.
How about a fleet of
refrigerated vans to transport fresh produce or perishables to markets on
behalf of farmers? Can they pay for that bearing in mind fresh fruits and
vegetables rot on transit to markets thus fetch lower prices? How about coolers
that fishermen can keep their catch overnight? Would people lease that to preserve
their fish?
7. Improve efficiencies in distribution of farm inputs and products
for easier uptake by markets of farm outputs at affordable prices, adoption of
“modern” farming practices & products, organic products? Can you do
anything around that?
8. Irrigation technologies & Innovations that improve food
security whilst encouraging use of new crops or new applications of traditional
crops and those that improve soils. How about biotech?