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.