I was asked to write an article for my company news letter that describes my placement here in Zambia. Here’s the result. It hasn’t been published yet so any feedback is appreciated.
On August 13th, 2010 I stepped off a bus in the small town of Pemba in the Southern Province of Zambia. I arrived with the task of understanding farmer purchasing behaviours surrounding fertilizers, pesticides, seeds and other agricultural inputs. Nervously, I gathered my bags and watched the bus disappear. There I stood alone. In the two days leading up to my arrival, I had only learned how to say a few greetings in the local language of Chi Tonga – none of which I pronounced correctly. There were stares, smiles and laughter from everyone passing by who were curious to see the foreign stranger who just arrived. I realized at that moment that the next few days were going to be my real introduction to life in Zambia, the country where I am currently serving a 12 month volunteer assignment with Engineers Without Borders Canada.
I arrived in Pemba earlier than expected and, after an hour of waiting, I was picked up by Mr. Muzuma. At 72 years of age, he is the head of his farming cooperative and the headman of his village. Living with Mr. Muzuma an hour outside of town for a total of four days was an experience. There was no running water or electricity. Bathing was accomplished outdoors in an enclosure made of straw and the water used for bathing had to be heated in a pot over a fire.
In those four days I learned as much as I could from this farmer. He showed me his village and I was able to meet other farmers in his cooperative. They were trying new planting strategies to increase their harvest and sustain the fertility of their soils. They were also diversifying their crops.
If they are able to learn the techniques to introduce new crops into their fields they could increase their security against crop failure, reduce their vulnerability to crop price fluctuations and bring multiple crops to market. They were all working hard to bring themselves out of poverty. Mr. Muzuma always reminded me, “the land of Zambia is rich, but we are struggling”.
Challenges with Farming
Mr. Muzuma shared his views on the key challenges faced by small-scale farmers in Zambia. As we walked around his farm, he frequently commented on how other farmers lacked knowledge on yield-increasing techniques. Another key challenge is access to inputs like fertilizers and seeds. He had many bags of fertilizer, pesticides and high-yield seed that he was storing for the next planting season. Mr. Muzuma explained, however, that this wasn’t the case for many other farmers. Most farmers could not afford the high cost of fertilizers and other inputs. Finally, he introduced me to a fellow farmer who had a lot of cabbage in his field that was rotting in the sun. “Marketing is a problem” he said.
Farmers are also confronted with the challenge of accessing markets to sell their crop. Many farmers are remotely located, so the high cost of transportation and a weak infrastructure make it extremely difficult for many small-scale farmers to reach potential customers.
Challenges with the Private Sector
Input suppliers share the same challenge of accessing markets. The cost of fuel is high and an inadequate transportation infrastructure prevents suppliers from reaching many remote small-scale farmers. Small-scale farmers, however, are a large part of the country’s population and represent a large untapped market.
In addition to transportation, another challenge input suppliers face is the diverse needs of small scale farmers. Small-scale farmers live in every region in Zambia, which vary greatly in climate and soil conditions. Further, the specific needs of farmers within each region may vary depending on which crops are grown, techniques used and technology utilized. With such a wide spectrum of customer needs, companies need to ensure that each farmer is prescribed the right product to solve their specific problem and each farmer is knowledgeable in using the product properly. Unfortunately, farmers currently do not receive correct instructions on how to use the inputs they purchase. The problem is compounded by the fact that many farmers are illiterate and unable to read the instruction labels. This may result in farmers not receiving any tangible benefits from high-cost inputs, due to improper use.
Lastly, the market has been distorted in the past by well-intentioned programs that provided free fertilizers or seeds to poorer farmers in Zambia. These programs have created unpredictable customer behaviour and a culture of dependency amongst farmers. We now have the challenge of strengthening the private sector in an environment where many potential customers expect to receive products for free.
Agent Model
One solution is the Agent Model. This model is currently being promoted by groups in the non-governmental organization (NGO) sector. Input supplier companies select and hire village-based agents. These agents are then trained to solve farmer problems and to advise on the use of agricultural inputs. Additionally, since agents are placed in the villages, they will be able to collect bulk orders to reduce the individual cost for each farmer. The end result is that farmers will receive better advice and products at a lower cost.
What has happened in the past?
The potential far-reaching benefits of this scheme begs the question of why hasn’t it been tried before. And the answer is, it has been tried and failed. Companies were experiencing high losses when farmers wouldn’t pay agents or the agents were not provided with material that was appropriate for their respective villages. Materials were stolen or simply expired while sitting on shelves, and products were not delivered in a timely manner, which is essential as farmers must harvest at the first rains. Trust broke down between all actors at all levels.
Trust is Key to do Business Right
One thing I learned from my work experience is that trust is the foundation of any business relationship. I spoke to another local NGO who is promoting of the agent model. We talked about how the private sector remains sceptical because they have incurred losses in the past with initiatives to build agent networks. In the past, trust was demonstrated through credit or providing stock on consignment by companies to agents. However, these provisions were taken advantage of. Earning trust is now a corner stone of this new project to build agent networks. Agents are not given credit or allowances up front. They are expected to generate orders and receive payments. When the payment is received, the input supplier subsequently ships the product to the agent or farmer. This decreases the risk of loss to the company while allowing them to build trust with their agents who can later earn credit or the ability to stock product on consignment.
Frequency of communication is important in building trust. Agents are expected to be in the field constantly working with farmers and investing time to solve their problems. Ultimately this will lead to the correct products and strategies being used by farmers which will translate to better sales for input suppliers and better yields for the farmer. It is simply good business for input supplier companies to support farmers with knowledge. Farmers are the largest customer base for input suppliers.
My Volunteer Assignment
As requested by a local NGO promoting the agent model, Engineers Without Borders will be placing me within an input supplier in Zambia. I will be initially based in the capital city Lusaka but I will be spending most of my time in the rural areas surrounding Chipata in the Eastern Province. My role will be to support the roll-out of the agent model for their business and work in partnership with local NGOs.
Developing a network of agents will be challenging. It requires the selection of trust-worthy people who are knowledgeable and they must have strong relationships within their village. Input suppliers will be required to manage and develop both the problem-solving and marketing skills of a large number of agents who are spread across large geographical regions. These challenges are not trivial, nor can they be neglected.
It is my hope that my team’s efforts in this sector will develop a competitive agent network. This promises to provide great value to both rural farmers and Zambia’s private sector. I believe that this is a step forward to promote competition amongst input suppliers and allow them to support previously unreached farmers in Zambia. With the increased access to knowledge and farming products, poor farmers in the rural areas of Zambia gain a greater ability to increase their food security, their income and work to lift themselves out of poverty.
