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'Kickstarter' for farmers

500farms is a crowdsourcing and delivery platform that connects small scale rural producers to buyers in Nigerian cities

Photo of shola

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EXPLAIN YOUR IDEA

500farms is a logistics platform that leverages technology to connect farmers directly to buyers in cities, creating market access beyond the geography of the farmers at a fair price & leveraging cities' higher GDP per capita.

Our solution lets buyers discover & pre-order produce. We aggregate the demands & place the orders with the farmers. On harvest, we ship the produce directly to consumers, cutting the time from farmers to buyers from about 15 days to 2-3days.

HOW IT WORKS
A few days/weeks to harvest, farmers (registered) send in their pricing & estimated output by SMS, which is fed into the back-end of our website. For the buyers, who are usually more sophisticated, they use the website/apps. The website runs similar to a flash sale site - time dependent and low priced - More buyers unlocks lower prices.

We then provide logistics for farmers by unlocking existing transportation solutions (similar to Uber), this means farmers are not bothered with storage, transport or market development, just on production.

The problems - glut at the farms when lack exist in cities because farmers can't sell, results in farmers' demotivation, poverty & lowers production - can be solved by INFORMATION SYMMETRY, DEMAND DRIVING SUPPLY & DEMOCRATIZING STORAGE. The UN estimates that saving food losses will solve the world's food security problems.

In addition to more production, an efficient system turns food losses of up to 40% into farmers' earnings.

WHO BENEFITS?

1.Women Producers
Small scale food crops farmers in Nigeria consists of 75% women, can get access to bigger markets, earn more & focus on production. No market development, no need/cost for storage facility means net increase in income & go up the $1/day narrative.

2. Consumers
Most consumers living in urban areas currently pay 100%-500% more than farmers sell can get low prices & delivery at their door.

3. Earth
Food waste (3.3B tons/year) accounts for 7% of global greenhouse emission.

WHERE WILL YOUR IDEA BE IMPLEMENTED?

Nigeria

ARE YOU IMPLEMENTING IN AN ELIGIBLE COUNTRY?

  • Yes

EXPERTISE IN SECTOR

  • I’ve worked in a sector related to my idea for over a year

EXPERIENCE IN IMPLEMENTATION COUNTRY(IES)

  • Yes, for more than one year.

TELL US MORE ABOUT YOU!

500farms is currently a small team, looking for collaborators and innovators. It started out of an interest to improve the agricultural supply chain in Nigeria and the significant disparity of food prices between urban & rural areas.

IS THIS IDEA NEW FOR YOU OR YOUR ORGANIZATION?

Yes it’s a new idea. We have been fine tuning the thoughts around it for a few months now.

With background as an architect and also being involved with production in the agriculture value chain over 2 years now, we discovered that hunger, food waste and spoilage are a logistics problem. This idea provides a logistics solution that leverages technology to crowdsource buyers for small scale farmers.

Most of the farmers we have come across have been women, and the national statistics confirms that over 75% of food crops farmers are women. However, they encounter barriers - cultural and resources- that make it difficult for them to thrive.

So we moved from production to design a solution to help most of the small scale rural farmers who are hit twice - being female and poor - earn more so that they can have better livelihoods - higher income, comparatively less work, more productive time for their family and afford basic healthcare, clean water at shorter distances, to fix leaking roofs, finance farm inputs.

This leads to a bigger and wider impact that what we did previously, for the farmers, economy, buyers, existing partners in the supply chain and the environment.

HOW IS YOUR IDEA UNIQUE?

We are using the last mile to drive the first mile - We provide farmers with direct market access that is demand driven (Pull) and aggregated rather than the traditional supply driven approach (Push). Through this we are able to democratize storage (hundreds of kitchens and pantries and encouraging private storage centres). This de-risks the farmers and entrusts storage to people with better capabilities & needs.

We enable information symmetry between farmers and buyers just before harvest, so that we can crowdsource pre-orders in bulk.

Time from harvest to buyers or storage is key to improve & simplify the supply chain. We are synchronizing and optimizing existing assets in the value chain. i.e transport,skill & storage.

By generating huge data points of demand and supply, we can operate better and predictably align assets even before harvest seasons to improve timing, reduce waste and advice farmers on what viable crops they should be planting.

Agriculture in Africa is one of the sectors least invested in technology. Technology and the internet offers us a unique advantage to crowd source fragmented small scale farmers and buyers at an unprecedented scale in Nigeria.

WHO WILL IMPLEMENT THIS IDEA?

500farms is driving the idea. The team is committed to moving it forward. At maturity, it will among others, consist of developers, designers, field managers, logistics managers, call centre agents, marketers. We are continuously seeking partners to help deliver better results.

In the beginning, we will be serving buyers from 3 districts in the city, from farmers in one local govt, so the early team will be minimal consisting mostly of generalists who can operate across different roles

HOW HAS YOUR IDEA CHANGED BECAUSE OF BENEFICIARY FEEDBACK?

We tested the assumption that all small rural farmers that owned a phone should be able to send us a sample sms about their harvest(or learn within 5 minutes).

The more important learning was about 40% didn’t have airtime or enough at the time to be able to send us the sample SMS. How can we meet these extremes?

We are considering a multi-lingual customer care center that offers a BEEP service – As long as farmers have 0.01 left on their phones, they can beep us, and we will call back to attend to them. High cost? We will experiment with integrating a VOIP service to cut cost.

Another feedback was that we found it much easier reaching farmers through referrals than approaching them directly.

We saw a need to build relationships & partnerships with businesses, government and non governmental agencies that have some level of programme with small scale farmers in the earlier stages of production in order to onboard farmers faster at scale.

This also reinforced the need for community/field managers, to enhance and build relationships on ground with the farmers to ensure trust. It will also help verify quality and quantity before they are shipped out from the farms.

WHAT ARE SOME OF YOUR UNANSWERED QUESTIONS ABOUT THIS IDEA?

1. Buyers are a key driver of our idea. With the prevalence of on-demand services, how might we be able to get buyers to wait a few days before getting their deliveries? Will offering low prices and convenience be enough?

2. Rather than spend a lot on marketing, how might we build a system that helps to generate the word of mouth needed to crowd source buyers?

3. How can we at the beginning incentivize independent transport drivers to be more reliable considering their strong unions?

WHY DO YOU THINK THE PROBLEM YOUR IDEA SOLVES FOR HASN'T BEEN SOLVED YET?

The solutions in the past have often been fragmented and isolated rather than a holistic view of the entire supply chain. Some assume a production problem & start producing or stimulating it. Data (supply and demand) is sparse and scattered so it is difficult and inefficient to connect the dots.

Technology. It is always useful to rebase ideas from time to time with technology change because what didnt work yesterday, may be much easier today with the availability of newer tools. Physical markets used to be an appropriate 'technology' to aggregate & crowdsource, now it's the internet. Designing based on newer technologies will break barriers for producers to improve earnings & livelihood.

WHAT WOULD YOU ULTIMATELY LIKE TO ACHIEVE WITH THIS IDEA? WHAT IS YOUR NEXT STEP TO GET THERE?

Ultimately, an efficient system for small scale producers like Miriam to be better economically empowered to take control of their life decisions to afford basic needs such as healthcare, shorter access to clean water, fix leaking roofs & better nutrition. As 75% of small scale producers of food crops in Nigeria are women, we get an opportunity to impact not only women and girls, but boys and men as well.

We start one farm after another, one producer after another, $1 saved after another.

MEMBERS OF MY TEAM HAVE BEEN WORKING TOGETHER FOR:

  • Less than 6 months
  • More than a year

MY INTENDED BENEFICIARIES ARE:

  • Within 50 km of where our team does most of its work
  • Within 100 km of where our team does most of its work
  • Within in 500 km of where our team does most of its work

MY ORGANIZATION'S OPERATING BUDGET FOR 2015 WAS:

  • We didn't have an operating budget

We provide farmers with direct market access that is demand driven (Pull) and aggregated rather than the traditional supply driven approach (Push). This also democratizes storage.

The traditional practice when smallholder farmers harvest, is to take it to the local market. Unfortunately, most of the farmers in the same community farm the same produce, so they cannot buy from each other. They are too far out from urban areas, and have poor market knowledge beyond their geography. Middlemen take advantage of this competition & poor market knowledge to drive a bargain.

This has translated to lower income, production for the small scale farmers has also fallen since most go to waste and they have to compete with other farmers for the same middlemen who have limited capacity.

On the other hand, in urban areas, food prices are high, mostly because of unavailability, losses during transportation & lack/poor storage.The current system has successfully created a glut at the farmers end and lack at the consumer's end, as distances from farms to urban areas stretch for hundreds of kilometers.

Our solution is to use technology to unlock values of all kinds of unused/underutilized assets from skills, produce to transportation infrastructure to improve the supply chain.

The first solution our technology platform does is to provide information symmetry between the farmers and the consumers.

The second allows consumers to place orders online. This runs like the Kickstarter model, allowing people to refer friends so that it can reach a tipping point faster so everyone can benefit.

The third, democratizing storage, is to provide logistics and transportation support between the farmers and the consumers by pooling truckers (similar to Uber but for trucks). Spoilage and waste is a function of time, instead of produce bouncing from one market to another looking for buyers, which can take up to 15 days, having a committed buyer shortens this to 2-3days.

By understanding the different users( farmers and consumers) we provide appropriate technology for them to use the platform. Simple SMS for farmers and a more robust platform for consumers.

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Photo of Chioma Ume
Team

Hi Shola, below are some feedback from the Amplify team and our experts. We look forward to reading your responses!

It'd be important to look at the impact at household level, what it is doing for household incomes. It's also important to apply a gender lens to see how and whether it empowers women, and to see if smaller scale and poorer producers can be brought into these supply chains.

-How many of your producers are women and what is their experience of using this scheme? How have they been socially and economically empowered by this?

-Are any producers aggregating into cooperatives and associations so that buyers can consolidate their logistics and buy from groups rather than individuals? How far from urban centres are buyers prepared to travel to source production? 

-We'd like to know whether long term relationships are developing and whether buyers are changing between suppliers. Does it encourage a longer term predictable relationship so that a farmer is able to supply regularly to order and predict their costs and income over an extended time period? Is there a risk is of buyers long-term between suppliers leaving farmers with an unsold stock. 

Photo of shola
Team

Thanks Chioma for the feedback from your team and the experts, they were really useful. I ll respond to each block of question in a different comment box.

|Question/Comment|

It'd be important to look at the impact at household level, what it is doing for household incomes. It's also important to apply a gender lens to see how and whether it empowers women, and to see if smaller scale and poorer producers can be brought into these supply chains.  

|Response|

Families like Miriam’s want better education for their kids, access to quality healthcare, eat nutritious meals outside of the ones they plant, get clean water in shorter time and to fix leaking roofs, however, these are limited to malaria induced dreams or some occasional hand outs by aid agencies.

Miriam farms on 1.2 ha but has access to land (5 ha) that is unproductive because she knows she wont be able to sell them all and a lot will go to waste while she toils at the marketplace searching for buyers. With 500farms, she can increase her output, sell all before harvest, earn more and still have more free time on her hands. These sees her sustainably and gradually climb out of the less than a dollar a day pool.

With more earnings and free time, she has more disposable income to improve the quality and standard of living of her family, some of the distance dreams do not seem like a mirage any longer.

Quite a number of these communities have values and culture that they complain are waning, they are happy to have more time to nurture, share and pass on to the newer generation because during the off farming season, they don’t have to bother with going to sell at marketplaces.

We had subtly indicated in our user experience map using Miriam the tomato farmer but we didn’t have enough room to document this. We found out quite early from our encounters that we would be dealing with more women (about 75%; national statistics) than men (about 25%). For food crops, our areas of interest, we discovered that apart from clearing and cutting trees, women do most of the others from planting to harvesting, processing and retailing at the market, which are areas where our solution focuses to bridge the economic gap – waste and gender.

So we recognized that an effective solution like 500farms for small scale producers should solve the problems of people on the extremes in poor communities, because if we do, people in the middle will be easily taken care of. These extremes consist of women, because aside the number, in most of these rural communities, they are doubly hit – poverty and being female – and have significant cultural and economic obstacles limiting their efforts.

Trends have shown that unlocking the economic empowerment of women is beneficial to everyone in the society – boys and men included, not just girls and women.

The solution is actually for small scale producers, if we can find them. There is a minimum effective quantity that is required for a viable transaction for buyers (determined mostly by the size of the smallest truck available for transportation). So for a campaign to take care of smaller scale producers, we will aggregate their produce into one campaign (Typically, most producers in a locality farm the same things).

Photo of shola
Team

|Question|
How many of your producers are women and what is their experience of using this scheme? How have they been socially and economically empowered by this?
National statistics indicate that 75% of the small scale producers in Nigeria are women. We do not have enough engagement beyond running tests to measure any metrics or their experience yet, but their expectations during our discussions about what it could offer were high.

|Answer|
They shared what they could do with extra funds, if they were able to earn more, being able to allocate resources as they see fit; better healthcare, access to clean water, nutritious meal, nicer wardrobes, better roofs/newer house. They didn’t speak about education much (primary & secondary), mostly because they figured government was doing enough with the free schools, but they wanted to be able to afford their kids going to college. 

Photo of shola
Team

|Questions|

Are any producers aggregating into cooperatives and associations so that buyers can consolidate their logistics and buy from groups rather than individuals? How far from urban centres are buyers prepared to travel to source production?

|Answer|

First a very simple analogy of how the process works.

Miriam has 100kg of tomatoes in Gboko to harvest in 4 days. We set up the campaign seeking for buyers. In 2 days, we got full subscription from 3 people, Paul – 30kg, Jessica -24kg, Femi – 56kg. After harvest, Miriam receives payment, we take the tomatoes, arrange transportation and ship to Paul, Jessica and Femi who live in Lagos (320km from Gboko).

So buyers’ roles are limited to placing orders. We consolidate the orders and the logistics. The challenge in Nigeria is that most (about 70%) of food is produced 300km – 1100km away from denser cities with higher per capita income. So it is not productive for one buyer to travel to source production, however one buyer can set out to source production for 100 other buyers, this reduces the unit cost of transportation.

A hack exists to this solution, typically when people in cities travel by road for business or visit home towns, farmers/producers come to the side of the highways in their villages and set up shops. Travelers buy a good bulk because it is way cheaper than in their city and they also serve as ‘souvenirs’ for neighbours from their trip. It is also very common for friends and families, who are aware of the trip to request a predominant produce common to the destination.

A number of producers aggregate into cooperatives and association. However one of the core of our idea is to find ‘takers’ for producers before harvest time, so that they don’t have to bother about storage, and considering rot kicks in when harvest begins. I think the cooperatives will be useful for access to producers and the knowledge they provide but there may also be disenchantments with the methods the cooperatives uses in prioritizing whose produce to sell and when. We could A/B test it and set required metrics to measure outcomes.

Buyers (in our case – busy professional in cities who do grocery shopping) wont find it efficient to travel 50km more than once a month to get groceries.

Photo of shola
Team

|Question|

We'd like to know whether long term relationships are developing and whether buyers are changing between suppliers. Does it encourage a longer term predictable relationship so that a farmer is able to supply regularly to order and predict their costs and income over an extended time period? Is there a risk is of buyers long-term between suppliers leaving farmers with an unsold stock.

|Answer|

Our interest is to build and develop long term relationships with producers on one side and buyers on the other. When a producer like Miriam comes on board and has a successful crowdsourcing campaign where they sell all their farm produce, it is unlikely that they would come back since they have nothing to sell, until the next harvest cycle.

Our buyers’ (busy professionals living in cities – grocery shoppers) needs are more frequent. Weekly, Fortnightly, Monthly.

But because buyers can see producers details and history, they may be more drawn to purchase by supporting producers and communities anytime they have a campaign.

It does offer predictability for farmers and this will become much better over time with data, which can provide farmers with information such as the most viable produce, the most requested, etc.

Our solution limits the risks by attempting to help farmers sell a few days/weeks before harvest time based on estimated output. If the campaign is unsuccessful, it allows the farmers begin to consider other options while there is still time before harvest.

Photo of Chioma Ume
Team

Wow, Shola - thanks for taking the time for such detailed responses!

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