Agribusiness

Enterprise Development

We apply a market systems approach to accelerate economic growth and reduce

poverty, particularly among small and medium-sized enterprises and smallholder farmers. We use market-focused tools to gain a thorough understanding of opportunities as well as legal, social, resource and other constraints. We then work at strategic points to encourage innovation, spur private sector investment and build relationships among industry participants. We are leaders in research on creating wealth in poor communities and promoting growth by linking small firms to profitable markets. Moreover, we inform about and learn from this research as we partner with local entities and private firms to design competitiveness strategies that include vulnerable groups, including women, youth and the very poor.

{“I am part of the value chain, and the value is coming to me—plenty.” —Ghanaian woman rice trader {

Enterprise Development

Lebanese Firm Upgrades and Extends Market Reach.

High-quality jams, syrups, olive oil, sesame products, pickles and other foods with the Mechaalany label are carried by specialty stores and supermarkets around the world. But the Lebanese food producer, established in the 1940s, only recently achieved its current market prominence with the help of ACDI/VOCA. Through the USAID-funded Lebanon Business Linkages Initiative (LBLI), which was designed to foster economic growth and reduce poverty, we helped Mechaalany develop its product line and improve efficiency, marketing and sales through market analyses, training and technical assistance. For example, to ensure that the company consistently follows effective food safety measures, we worked with its management team to conduct a systematic quality control review known internationally as a Hazard Analysis and Critical Control Points (HACCP) gap analysis. Our advisors also worked with Mechaalany to research local and export markets to develop a fine-tuned sales and marketing strategy. Mechaalany developed new packaging and launched, with cost-share from LBLI, an innovative local supermarket promotion to increase consumer awareness, bringing in $80,000 in initial sales. Mechaalany also began integrating with other parts of the value chain: The company now sources produce from local organic producers instead of importing it from abroad, and outsources distribution to a local company. As a result, it has increased cost-efficiency and raised local sales by 35 percent. Mechaalany’s success extends beyond local markets: the company exports to Asia, Australia, South America and the United States. To raise the company’s U.S. profile, ACDI/VOCA shared the cost of 28 in-store promotions in five key supermarket chains, helping to boost exports to the United States by 20 percent. Mechaalany’s success is just one of many such stories in Lebanon, and it represents the success of all—from smallholder farmers to distributors, food quality laboratories, exporters and others—who play a role in Lebanon’s food value chain.

Financial Services

Agricultural finance for smallholders and for micro, small and medium-

sized enterprises is a key economic driver, but often a missing link, in rural and conflict-affected environments. To address this gap, we work to create mechanisms and build upon relationships that promote delivery of financial products and services within rural value chains. We also build the capacity of commercial financial institutions to meet the needs of the underserved and link producers to markets. By creating an understanding that the rural poor can become creditworthy, we expand economic opportunity.

{“Thanks to USAID, we solved a major problem, expanded irrigable land and increased our profit. I never knew it was possible to get agricultural machinery through loans.” — Farmer, Qubodiyon District, Tajikistan {

A Better Model for Rural Finance.

On some days, Memunatu Alhassan’s family ate nothing because there was no money for food. The 45-year-old from northern Ghana worked hard to grow soybeans and groundnuts on her 2.5–acre farm, but her crops had no reliable markets and her income was barely enough to feed the family, let alone send her children to school or repair a collapsed room of their home. Sometimes seeds and labor were more than she could afford, and her land would lie fallow. The situation Memunatu found herself in is not uncommon. Many poor smallholders have land to cultivate, and consumers want their crops. But the linkages between farmers and markets may be tenuous or nonexistent. Storage and transportation problems abound, and traditional providers of financing—such as banks or microfinance institutions—won’t risk lending to farmers. Memunatu found strength in numbers through a USAID-funded program designed to reduce rural poverty and build value chain linkages. The ADVANCE program helps link farmers to markets, finance, inputs and equipment services through larger commercial farmers and traders who have the capacity to invest in these chains. The program helps increase the efficiency of farm businesses with improved production, post-harvest handling and market access. Through ADVANCE, Memunatu began working in an outgrower arrangement with Khama Farms Enterprise, a larger commercial farmer. Khama Farms provided her with plowing services and quality seeds on credit. With this assistance and with training, Memunatu’s yields increased by 50 percent—and with access to markets through Khama Farms she earned three times more money. She has been able to send her daughter to a training college and repair the damage to their home. And her family eats nutritious food every day. “Previously my family would go a whole day without food. Now I can prepare any meal I desire.”