FARM AND RURAL BUSINESS DEVELOPMENT
VALUE CHAIN DEVELOPMENT: Expanding markets
Although rural economic actors are independent, many are part of an integrated chain of economic functions and linkages. All the activities that connect a specific raw material to its various end-markets is collectively called a “value chain”. In rural value chains, market sizes differ dramatically among the actors. Available markets are usually much smaller for actors further up the chain (toward the primary producers), making it less attractive and riskier for them to invest in technical improvements or expanding production.
By understanding the processes involved in the production, distribution, and sales of a product or service, it is possible to identify the main sources of growth in a chain, the distribution of margins and profits, and the key leverage points of that can be enhanced in order for chain actors to deliver higher value and increase their income. Often, this is achieved through solutions that overcoming the consequences of being a small-scale producer.
ACCESS’s value chain research and development toolkit has been designed especially for rural producers of agricultural commodities and agri-entrepreneurs. It focuses particularly on market size and market linkage (for purchases of inputs as well as sales of outputs) in order to create incentives for investment and expansion.
- Value chain analysis
- Value chain financial product development
- New farm and enterprise demonstrations
- Business modeling
- Market linkage
- Facilitation of partnerships between value chain actors
INNOVATIVE APPROACHES TO SUCCESS
One of the most effective learning methodologies is learning-by-doing. To encourage the value chain to develop, ACCESS facilitates small-scale grant programs for demonstration activities to test “proof of concept” and thereby demonstrating to the community that it is economically rational to invest in production.
RESULTS AND REFERENCES
- Nepal National Value Chain Study on Grain Harvest Machinery: International Maize and Wheat Improvement Center (CIMMYT), 2019.
- Conduct value chain analysis and constrains and opportunities for Market Systems Development and the demand in Myeik and Palaw Townships in Tanintharyi region for two selected value chains: World Vision Myanmar, 2018-19.
- Technical Assistance to UNNATI Access to Finance (A2F) partner banks and financial institutions in Nepal to develop Agriculture Value Chain Finance products and Services: UNCDF Nepal/UNNATI, 2018.
- Financing the Large Cardamom Value Chain in the EDR with a Focus on Smallholder Farmers: UNCDF Nepal/UNNATI, 2016-18.
- Value chain analysis and market assessment of selected agricultural commodities in Kayin and Chin States: Action Aid Myanmar, 2016-18.
- Develop a strategic plan for potential on-farm/off-farm economic activities in Hpa-An and Hlaingbwe Townships, Kayin State: World Vision Myanmar, 2017-18.
- Development and Installation of a Farm Plan and Budget Tool for Multi-Crop Farmers: International Finance Corporation, 2016-17.
- Supporting Financial Access via Cooperative Upgrading and Enterprise and Farm Development in Kayin State: European Union and Agence Française de Développement, 2014-17.
- Improving Financial Access of Small-Scale Farmers in Mindanao: Japan International Cooperation Agency, 2011-14.
- Rapid Rural Appraisal of Tea Production in Phu Tho Province, Vietnam: TYM MFI, 2014.
- Mid-term Evaluation of the Program entitled “Promotion of economic development and income generation through market inclusion of small farmers from rural and coastal communities affected by the conflict in areas of action of the Spanish Cooperation in the Philippines”: AECID via CODESPA, 2013.
- Improving Financial Inclusion and Social Impact towards Food Security in Southeast Asia: European Union and Agence Française de Développement, 2010-14.
- Needs Survey of Product Development and Training system of First Microfinance Bank of Pakistan: Japan International Cooperation Agency, 2010-11.