We see more companies recognising that they can make a contribution to wider economic, environmental and social progress and starting to adapt the way they do business. That is great, and is essential. But it is not enough. We have also to unlock the potential of poorer people, particularly women, to seize these opportunities.
Hand in Hand’s starting point is bottom up, focussing on our beneficiaries. We have an integrated model: training them how to run and sustain a business, providing bridging loans or access to finance, then identifying market linkages. We are successful in creating jobs and building enterprises. Most are family based or small, but are critical for diversifying income and improved livelihoods.
Developing the value chain is fundamental:
To identify and grow new markets in the informal economy – such as providing chicken to local fast food outlets in Lesotho;
- To provide a regular market at secure prices. This give confidence to entrepreneurs – for instance, linking Kenyan farmers to supply avocados to Kakuzi, the largest supplier of avocados in East Africa; or providing purses to a retailer in India;
- Once the market is identified, to supply inputs – such as Coca Cola providing equipment and stock to small shops established by women we have trained in South Africa; or the supply of yarn to women in Afghanistan by the wool processing company, Bano;
- For the purchaser to provide technical advice and training to suppliers to improve productivity and quality – as Kakuzi in Kenya and Bano in Afghanistan are doing;
- By developing intermediaries – for example TechnoServe in East Africa to train and organise farmer groups to supply Coca-Cola’s locally-produced and sold fruit juices.
Success depends on development of the basic skills needed to take advantage of new market opportunities, integration into wider livelihood strategies, and sustained support. Economic and social development cannot be merely an add on for business, it must generate new ways of working, new partnerships.
In January this year, Hand in Hand had helped 8,117 members in east Africa with market linkages. Even though most of them occur on the small scale they have all helped members generate income and in turn alleviate poverty. For us, key challenges in moving to scale and deepening impact are:
- Linking formal sector businesses to the informal sector, having the flexibility and patience to deal with small suppliers.
- The volume and regularity of supply demanded by many larger businesses.
- Moving enterprises beyond the micro level without being suffocated by regulations.
