Cultivating rural businesses
21 July 2023
The Cultivate pilot program supported small and growing agri-businesses in Kenya, Tanzania and Ethiopia to unlock their growth potential.
Developed by Farm Africa with funding from the Vitol Foundation, Cultivate aimed to stimulate economic growth in rural eastern Africa by providing business skills training to small and growing businesses with an agricultural focus.
A hybrid remote and in-person business skills training program was delivered to 64 rural agri-businesses in Kenya, Tanzania and Ethiopia, exceeding the target of 40 businesses by 60%. Seventeen were women-led.
These agri-businesses ranged from primary production to processing, aggregation, wholesaling, distribution and export of agricultural produce. Cultivate, which ran from January 2019 to June 2022, supported these businesses to:
- access online business skills training in collaboration with the African Management Institute (AMI) to improve their skills in operations, networking, finance and planning
- improve their profitability, revenue growth, client and supplier count, and product quality
- manage financial risk and unlock growth potential
Through these improved business and technical practices, the project aimed to empower the businesses to achieve stable long-term business growth.
ONLINE TRAINING, IN-PERSON SUPPORT
All the businesses, with the exception of the Ethiopian cohort, undertook the online AMI Guided Grow Your Business (for early stage enterprises) or Grow Your Business (for growth stage enterprises) training programs.
Due to a lack of internet access, the ten Ethiopian businesses received their AMI training offline using translated AMI training materials. The remote learning was combined with in-person technical support visits by the Cultivate team.
Project staff learnt that combined online training and in-person support provided the most cost-effective and impactful way of delivering the training. This conclusion was supported by participant feedback data, with 70% of businesses indicating this as their preferred combination.
Although participants appreciated the convenience and cost effectiveness of online training, the personalized technical advisory support they received was also highly valued and helped to build trust between businesses and Farm Africa staff.
PLANTING THE SEEDS OF SUCCESS
One of the many agri-businesses to have taken part in the Cultivate training was The Rey Products Group, based in the Singida region of Tanzania. Established in 2014 with five employees, the business specializes in processing sunflower seeds, with their main products being sunflower oil and seed cake.
Before joining Cultivate, Mr Said Mtoro, the business owner, was struggling to take his business to the next level.
“We were not doing research to know how other businesses were branding their products; we were not keeping records and we had no proper hiring procedures”, he commented.
When Mr Said heard the Cultivate training would cover ‘how to understand customers and markets, track transactions and stock, streamline operations and plan for growth’, he was quick to enroll in the six-month training program.
As a result of the training, we have engaged an expert in bookkeeping, and we conduct market research. We also recruit new staff by advertising and conducting interviews so that we can get competent employees.
Mr Said Mtoro
The improved business practices have had an immediate impact. Since undertaking the Cultivate training, The Rey Products Group has increased its number of employees from 12 to 15 and successfully secured a loan from NMB Bank’s Singida branch, increasing their working capital by 25%.
The company is now marketing their sunflower oil in Dar es Salaam, Kilimanjaro and Kagera regions, and has begun exporting sunflower seed cake to Kenya.
GROWING RESILIENCE
The results of the Rey Products Group mirror the growth and improved performance achieved by other agribusinesses that participated in the Cultivate training. During their period of involvement with the project, participating businesses reported an overall 18% increase in average monthly revenue and 7% growth in profits.
A total of 11 businesses (26%) independently accessed working capital with 64% of the loans accessed from formal financial institutions. There was also a 30% net growth in employment, with 23 businesses hiring a total of 73 new employees, 97% of whom were female.
To have achieved this growth, despite two years of below average rainfall and lingering setbacks from the Covid-19 pandemic, attests to the participants’ improved ability to manage risk and maintain stable, longterm business growth.
That isn’t just good news for the businesses, it’s good news for their communities. Strong, resilient agri-businesses grow the rural economy, providing local employment and a reliable income stream for the smallscale farmers who supply them.
