Harnessing the Business Potential of Honey
I have recently been focusing my time on a honey production company called KEYDA, one of the two selected youth led companies on whom the business booster will be tested in the third phase of the pilot. To get a better picture of their current status and in order to assure a certain level that will enable KEYDA to benefit from the services of the “One Stop Shop”, Nathaniel, one honey expert, and I travelled to “the provinces” (that’s what people here call everything outside Freetown). In Kenema, we sat down with the staff of KEYDA, and took bumpy roads to the far-off rural villages to hold focus group discussions with their supplying cooperatives. From the focus groups, we identified three main challenges:
Let me give a brief description of KEYDA: KEYDA was selected to receive a grant from the Youth to Youth Fund in 2010. Six youth-led women cooperatives (note: “youth” in Sierra Leone is officially defined as the age group between 15 and 35) were formed and registered, trained and provided with hives and equipment. The women take care of the hives and harvest the raw honey in jerry cans and send these to Kenema, where it is filtered, packaged and marketed. The project started off successfully and two years ago, KEYDA even won the “Business Bomba Competition”, a competition rewarding the most promising business plans in Sierra Leone (for more information, visit the competition website).
So, where did the problems start? After the start of the project, KEYDA came to face serious marketing problems. The supermarkets did not like the rather simple packaging and sales were very slow. All their products were provided on commission and so far very little money has flowed back. This led to a serious cash-flow problem: farmers could not be paid, there was no money to continue support activities such as advertisement, regular monitoring of the cooperatives and consequently, this year’s honey harvest was put on hold.
Secondly, monitoring and communication is rather expensive: one selection criteria for the villages have been a rural setting in which young women can be empowered. Naturally, this does not go together with a good network coverage, beautiful roads or any other easy access. That means that the field supervisor has to spend up to one hour on a motorcycle to reach out to the communities, and the costs of fuel and vehicle maintenance are high - not affordable for KEYDA at the moment. Which leads to a lack of communication and supervision: the women don’t understand why they are still waiting for their money and blame the manager.
The third issue that came up in each and every discussion was the worn-out material. Along with the hives, each woman was given a helmet, a raincoat, gloves and boots for safe harvesting. Only two years and three harvests later, the equipment is said to be worn out. Why? The raincoat has been used during the rains, the gloves and boots to clear the farms, and so the list goes on.
A suggestion made by the honey expert was to invest in some very specific beekeeping equipment that can be used for honey harvesting only and give it to the chairlady to keep it for all members instead of providing every member. If all the women share the equipment, it creates a higher level of responsibility for the materials.
With regards to the marketing problem, we jointly came to the conclusion that KEYDA has to sell this year’s harvest in any way, even if it would mean wholesaling the raw honey for further processing at a lower price, which would at least generate some income that could be used to pay and satisfy the producers. For the next harvest, finances have to be raised in order to invest in packaging and marketing that will assure the sales of the final product. The demand is there; compared to the imported honey, the local honey is said to have a high medicinal value and even to protect the house from witchcraft.
The second crucial task is that, in one way or the other, the internal control system has to be put back in place. The motorcycles KEYDA owns have to be licensed so that the field supervisors can resume their weekly monitoring visits and encourage the farm monitors. The farm monitors are members of the community who supervise the producers, help out with advice, and report to the field supervisor.
We hope that these first-aid interventions will put KEYDA back on track so that they can make use of the services of the One Stop Shop, which are not meant to revive the business, but boost it!
Business Booster is a joint program of the YEN (Youth Employment Network), UNIDO and Endeva. The project seeks to pilot a holistic multi-stakeholder approach to increasing the earnings of youth-led cooperatives in Sierra Leone, by enabling them to access premium markets such as the US and/or the high value domestic market where they would compete with foreign imports. In doing so, the project will not only increase the revenues of young low-income farmers’ but also test an innovative approach that can be scaled up and help smallholder farmers and producers in a range of contexts tap into premium markets.
At the center of the Business Booster approach is the One Stop Shop. This will be a local organization that will serve as a central player and link food processing companies and/or smallholder farmers to opportunities in premium markets both locally and abroad. It will be serve as an interface for farmers and producers to receive the support they need in key areas such as product quality, marketing and access to markets.
Maren Peters, is currently in Sierra Leone conducting a needs assessment of the cooperatives involved in the Business Booster and a country assessment of the agro-processing sector in order to prepare the business plan of the One Stop Shop.
Maren shares her experiences in this blog with Business Fights Poverty members. Stay tuned for future blogs.
For more information on the Economic Opportunity Zone and Africa Felix juice visit www.firststepeoz.com and www.africafelixjuice.com
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This is a very insightful article and poses very important lessons for Rava Exclusive Apiaries, that we are setting up in Zimbabwe. Once we are settled after our harmonized elections, Rava Zimbabwe Rava Trust, Rava means read in shona being our local language. Basicaly the Trust which is a nonprofit entity that advocates Zimbabweans to read beyond academia and resource libraries with self improvement books. In fact its main objective is to inspire people who do not read to start reading, motivate those who read a little to read more, nurture a reading culture to the youth and re-enforce the avid reader to read even more by ensuring that reading material is always available to the populace. In order to resource the Trust, the founder starts social enterprises that are profit making and the greater percentage of the profits (minimum of 60% of after tax profits)are then channeled to the Trust to carry out these objectives. It is however important that the profit making initiatives or ventures are people centered especially to benefit and empower the marginalized communities. The most marginalized members of our society is the woman and the young girl child and yet these are likely to re-invest income on food, education and healthcare for their children and families if they are empowered. In Zimbabwe we say once you have taken care of the woman you have built the nation. Rava Exclusive Apiaries is being formed to empower the marginalized rural women in Zimbabwe and to this end 140 RAVA EXCLUSIVE HONEY CLUBS will be set up country wide. Each club with a minimum of 15 women will be resourced with 10 langstroth bee hives. Their responsibility is to look after the hives, when they are ready to harvest, we set harvesting teams to harvest, pack and market the honey on behalf of the Clubs, the proceeds are then given back to each club who then part pays for the hives that have been advanced to the Club. This goes on until the Club pays back for the hives and now continues to expand as well as starting other satellite clubs around them to create the critical mass of honey production until Zimbabwe is a net exporter of honey.
The problems that Maren sites for Sierra Lione are more or less similar to Zimbabwe but are less acute. The road network is good and one can navigate to any of the clubs with easy. Harvesting, Packaging and Marketing of the honey will be carried out by trained personnel in the three areas mentioned. Our envisaged problems are Firstly funding for the hives, we currently do not have long term funding for the project and then secondly the consistency in quality of the honey. We are therefore seeking expertise on honey quality as well as a social investor who can lend to the project at concessionary interest rates and giving 36 months repayment of the loan, a princely sum of $200 000 as each club will cost +/-$1 500 to establish..
Thank you so much for this article and Maren kindly let us know if you can be of any assistance.
Welthungerhilfe (http://www.welthungerhilfe.de) implements in the south and east of Sierra Leone an EU funded food security project. On of our focus lies beside sustainable agricultural practices on identifying promising business ventures in rural communities. This not an easy task since infrastructure is badly maintained, transport costs are high, labour costs are unreasonable and in no relation to the productivity. Since more than three years we are working with around 140 bee farmers in the rainforst zone. The production is gradually improving and 2013 we were able to offer a smaller quantity well packed to the urban markets. The biggest share of the production is sold locally by the individual beekeepers. We deceided to go for the individual approach “addressing” each bee farmer in a Farmer Field School & offering training according to the honey production cycle and leaving the internal management of the equipment (solar extractor, smoker, T-bar hive, protective clothes) with the small farmer field scool of 9 to 10 farmers. New requests for hives and equipments is coming in though the farmers have to pay for the equipment an own contribution of 20% on the costs. Additionally, beekeepers are trained in simple recording of costs and income – still a long way to go. KEYDA is a different story and more a top down approach against the low prevalance of entrepreneurial attitudes. Bee keepers are members of the organisation and the organisation should service the members and explore markets for them. Recently KEYDA was at lockerhead with the members since honey was provide but the payment is still pending and the managers need to survive. We are careful in promoting structures which are not in concert with the local farmers there knowledge and are not rooted in the communities.