Turning smallholder farmers into business people
Poor African farmers are understandably reluctant to invest a year’s income in agricultural equipment. However, for those who do take the risk, the rewards can be substantial.
KickStart, an NGO founded 20 years ago in Kenya, aims boost the incomes of smallholder farmers, not through handouts, but by selling them tools to improve their output. The company produces small-scale irrigation pumps that can increase farm income by up to 1,000%.
KickStart has a direct presence in five countries on the continent, namely Kenya, Tanzania, Mali, Burkina Faso and Zambia. It also has an office in San Francisco, mostly for fundraising purposes.
The pumps, branded MoneyMaker, are manually operated, either by hand or foot. They can pull water up from 7 metres and the most expensive model is capable of irrigating close to 1 hectare of land.
In Tanzania, farmers can buy the pump bundled with hoses and spare parts at Tsh.99,000 (US$56), for the cheapest model. KickStart says that it chose the name MoneyMaker because that is a poor person’s greatest need – a way to make money. The average net farm income in Tanzania is currently Tsh.120,000 ($67) a year; KickStart says that the average farm income for those that use its technology is Tsh.1 million ($562).
Most smallholder farmers in Tanzania are entirely reliant on rainfall, which has become increasingly erratic due to climate change. Because farmers receive the same rainfall, all crops are harvested at the same time, and hit the market together. This drives down prices as well as farmers’ earnings. In addition, by relying on rainfall, most farmers can only harvest once or twice a year.
With their own irrigation systems, farmers can greatly increase their earnings. “The idea . . . is . . . that farmers can get three or four crop cycles a year. When it is dry season and no one else has crops, they are growing things, taking them to the market, when the prices are high,” Alfred Wise, KickStart’s Tanzania country director, told How we made it in Africa in an interview.
KickStart is trying to position smallholder agriculture as serious business. “For many poor Africans, farming is not an ‘aspirational’ activity. People dream of being a successful business person but see farming as a dirty, backbreaking chore. We are trying to change that. We’ve launched a comprehensive marketing campaign built on the message, ‘Farming is My Business’, to link farming with success,” says the organisation on its website.
To date KickStart has sold 45,000 pumps in Tanzania. However, according to the organisation’s estimates, there are up to 800,000 Tanzanian farmers with access to water who can benefit from the technology.
While KickStart operates as an NGO, the pumps are sold for profit by agricultural dealers. In Tanzania alone, MoneyMaker pumps are available in around 230 outlets. The organisation’s strategy is for everyone in its supply chain to benefit financially. “It can only be sustainable through these [dealers] making their margin,” notes Wise. “And then understanding that the farmers they sell irrigation equipment to, can become better farmers, then have money, then come back and buy a lot more seed and fertiliser and pesticide from them.”
Poor farmers are usually extremely “risk averse”. KickStart is well aware of this. “We know that our tools represent a significant investment for a family,” says the organisation.
Wise explains that most customers buy the pumps on recommendation from other farmers. “Our strongest way of getting new farmer adoption is through existing farmers that have used it and it has proven itself to them. They are usually reluctant. We are asking some of the poorest people in the world for money to invest in technology. So they are rightfully wary. In Tanzania, we have sold . . . about 45,000 pumps. So in a sense it is getting a little bit easier because farmers will talk to their neighbours about how they are making money, how they have moved from a mud house to a block house. How their kids are going to school. So it is getting a little bit easier.”