Kenya

Kenya Agrodealer Strengthening Program

Overview:

The three-year Kenya Agrodealer Strengthening Program (KASP) project, made possible by a grant from the Alliance for Green Revolution in Africa (AGRA), strengthened Kenyan agrodealers by providing training in business management and productive farming methods, as well as increased farmer access to agrodealers in remote areas, ultimately raising rural incomes and increasing household productivity.

CNFA worked to improve the input supply and output marketing distribution channels available to smallholder farmers in rural Kenya by expanding a commercially viable network of rural retail enterprises. Through KASP, we built on the foundation of existing agrodealers in Kenya and expanded the network to cover 85 districts located in targeted agricultural areas across the country. Expansion of this network benefited smallholder farmers by greatly reducing the distance traveled to obtain needed equipment and farm inputs. Many such items are difficult to transport long distances, especially in areas where roads and other infrastructure are lacking.

Program Approach:

  • Strengthened the business and technical skills of agrodealers to better serve the needs of smallholder farmers;
  • Improved rural access to finance to jumpstart agrodealer enterprises in areas where none existed;
  • Increased smallholder farmer access to larger markets in which to distribute their products by working with agrodealers to develop and deliver basic output marketing training;
  • Increased farmer awareness of market opportunities, helping to link them to existing market channels;
  • Advanced agricultural policy advocacy by creating a mechanism for sustaining a public-private policy dialogue.

Agrodealer Surveys: CNFA carried out agrodealer surveys in all 85 districts of KASP operation. Through its locally registered Kenyan affiliate AGMARK, CNFA developed a comprehensive database with 5,156 agrodealers, representing 52% of the estimated 10,000 agrodealers in Kenya at the time. Our team also developed GIS-based Maps showing agrodealer density and distribution. AGMARK boasts the most comprehensive database of Agrodealers in Kenya, and is now used by leading stakeholders in the agricultural inputs industry.

Business Management and Technical Training: We certified 1,976 agrodealers through a six-module business management training program that included sessions on managing working capital, managing stocks, costing and pricing, selling and marketing, record keeping, and managing business relationships. CNFA/AGMARK also worked with input suppliers to develop and deliver technical training to agrodealers in product knowledge, handling and safe use of pesticides, herbicides and fertilizers, and use of improved seed. Demonstration plots and farmer field days increased smallholder farmer awareness and demand for improved inputs. AGMARK-led training is now recognized by leading stakeholders in the inputs industry, including the Ministry of Agriculture, who has required individuals to be trained by AGMARK in order to participate in certain government subsidy programs.

National Accelerated Agricultural Input Access Program. NAAIAP is a government-sponsored program targeting resource poor farmers in order to facilitate access to improved farm inputs with the aim of firstly improving agricultural production of staple foods, and secondly to promote the use of quality farm inputs for increased productivity. Since its inception in 2008, KASP was involved in the program by preparing Agrodealers with business and technical skills, as well as financial support to enable the Agrodealers to provide farmers with the correct information and inputs. The subsidy program worked with more than 60 districts (over 95,000 farmers) in the country. Those who benefited from the program received seeds and fertilizers valued at US$7,757,478.

Credit and Financial Services: Credit guarantees are an important instrument in enabling small rural-based and start-up agrodealers to access the credit necessary to stock their stores. As such, CNFA/AGMARK deliberately chose to partner with wholesalers and microfinance institutions because the more established financial institutions do not target them. A matching investment facility targeted two areas: agrodealer start-up and grain bulking and aggregation.

Technical Training: CNFA/AGMARK facilitated Agrodealer training on technical knowledge of inputs by input supply companies, in addition to project training on seeds, agrochemicals, veterinary and fertilizer companies, product knowledge, and safe use. These trainings are conducted to share technical and safe use knowledge about inputs with Agrodealers so that they can teach farmers at the point of sale. AGMARK developed Agrodealer training modules for seed fertilizer and agrochemicals. Over the life of activity, other stakeholders, including the Ministry of Agriculture (MOA), Agrochemical Association of Kenya (AAK), Pest Control and Produce Board (PCPB), Kenya Health Inspectorate Services (KEPHIS), Kenya Bureau of Standards (KBS), National Environmental Management Authority (NEMA), Kenya National Agrodealers Association, and various financial institutions were also involved in the trainings to ensure that the various components of agricultural input handling are exhausted (i.e. the Agrodealers have to ensure that the businesses are licensed and actually stocking products that meet the required standards. They also must ensure that smallholder farmers have access to improved agricultural inputs and better production practices). These interactions provided vital linkages for continued business and education relationships.

Output Marketing: CNFA strengthened the linkage between input and output distribution channels, and used the rural retailer as a link back to cash markets for their farmer customers. The agrodealer served as a strategic point in the value chain. KASP provided agrodealers with small matching grants to improve storage, put in small processing facilities, and invest in transportation, packaging, and handling equipment for farmer outputs.

Demand Creation: Demand creation activities were crucial in the KASP program. Through these activities, farmers were exposed to the different methods of growing crops, the use of hybrid seeds, the use of veterinary products, and the proper handling of fertilizer and other farm products. The seed and fertilizer companies were able to penetrate the market after establishing demonstration plots and holding field days to show farmers, first-hand, the quality that could be produced with improved seed and fertilizer. 142,789 smallholder farmers attended KASP-sponsored farm input exhibitions and were exposed to a broad range of productivity-enhancing farm inputs and services.

Output Marketing: In all of our agrodealer programs, CNFA strengthens linkages between input and output distribution channels, and uses rural retailers as a link back to cash markets for their farmer customers. The agrodealer serves as a point of market information, trades in outputs as well as inputs, and often engages in primary processing, storage, or handling. To foster and strengthen these initiatives, KASP provided agrodealers with small matching grants to improve their storage facilities, add small-scale processing capacity, and invest in transportation, packaging, and handling equipment for farmer outputs.

Association Development: Association development was at the core of KASP activities by creating a sustainable forum for advocacy on behalf of small businesses and agrodealers throughout the target districts and more broadly, nationwide. CNFA has previously helped launch agrodealer associations in Kenya and Tanzania and built their capabilities through trainings on organizational management, member services, networking and advocacy and capacity building. CNFA/AGMARK activities led to the formation of 25 agrodealer associations, including one national-level association, KENADA.

Program Impacts:

  • 1,976 Agrodealers trained and certified through CNFA’s six-module Business Management Training Course;
  • $2,559,885 Credit leveraged by 756 agrodealers;
  • 142,789 Farmers attended 332 field days, demonstration plots, and exhibitions featuring 52 companies supplying inputs and other agricultural services;
  • 169,734 Metric tons of seed and fertilizer sold through KASP agrodealers.