The condition of the development of Sharia Smallhoder Financing Banks is very contrary to the number of Muslim population in Indonesia. As a country with the largest Muslim population, Indonesia should have a higher market share of sharia banking than other countries. The challenge of developing the Sharia Smallhoder Financing Banks industry to face these obstacles is through the Sharia Smallhoder Financing Banks development model that can be developed in the future. The Sharia Smallhoder Financing Banks business development model is expected to provide an overview of the operational business processes of Sharia Smallhoder Financing Banks that are pro-sector real and crisis resistant for the benefit of the community.
When the issue of economic growth and development of the country is raised, one has to take into account the performance of the growth of smallholder farmers. Reducing the challenges they are facing and utilizing their potentials can help to accelerate the agricultural sector and economic development of the country as a whole. Agricultural cooperatives are ideal means for self-reliance, higher productivity and promotion of agricultural development. Therefore, the major concern of this book is empirically analyzing the role of agricultural multipurpose cooperatives found in the Southern Zone of Tigray Region of Ethiopia. It is suggested that more attention is to be given to the human resource development of the cooperative auditors through short term and long training programs so that to able to undertake timely audit of the cooperatives both in terms of quality and quantity. Moreover, professional management is becoming crucial issue for the cooperative societies in order to run viable and profitable business that can meet members benefit. Therefore, due attention is required for the recruitment of professional managers.
When the issue of economic growth and development of a country is raised, one has to take into account that the flourishing growth of smallholder farmers' cooperatives. Here, the concept of market linkage among and between those small holding cooperatives is unquestionable to solve the marketing failures in the contemporary situations in the market place now days. Reducing the challenges they are facing and utilizing their potentials can help to accelerate the economic development of the country as a whole.Cooperatives are ideal means for self- reliance, higher productivity and promotion ethical business development among the society. The response variable market linkage was between the union and its affiliates was measured using the amount of purchase each sample cooperatives purchased from the union and the amount of patronage dividend each cooperatives has got in the last six years. Among the major findings, distance was found to be not significant to influence the market linkage between the union and its affiliates, but variable like number of share and year of affiliation were found significant at 5% level of significance.
In recent years development practitioners working in the area of rural agriculture recognise that profit making enterprise is a concept that must be promoted and appreciated by the people they target with their non profit making interventions for sustainability. This conundrum of undertaking non profit interventions to achieve pro profit outcomes has led to many development aid agencies to develop and adopt models that engage their target groups in profit making initiatives and seeking out private sector partners. Self Help Africa has in the last decade been promoting a farming as a business model based on the principle that smallholder farming families not only increase their productivity but also make it profitable. This means growing surplus crop for markets and selling above the cost of production. With a strong focus on women, Self Help Africa's work seeks to provide gender sensitive approaches that specifically addresses women-specific challenges so that they are able to equally participate and establish successful agri-based enterprises. This research examined the extent to which the Self Help Africa model was engendered in promoting farming as a business for rural women.
The farming structure in transition countries has shifted from dominance of large corporate farms to family smallholdings. Smallholders everywhere experience difficulties with access to market services, including sale of products, purchase of inputs, and acquisition of machinery, they suffer from credit shortages and have limited access to information and advisory services. The barriers to market access prevent smallholders from fully exploiting their inherent productivity advantages. Best-practice world experience highlights farmers' service cooperatives, created by grassroots users, as the most effective way of improving the market access of small farmers. Service cooperatives also help smallholders overcome market failures, when private business entrepreneurs are unwilling to provide services in areas that they judge unprofitable or unfairly exploit users through monopolistic practices. These difficulties and market failures are prominent in transition countries and scholars accordingly expected rapid development of agricultural service cooperatives in response to smallholder needs. The present volume explores the gaps between expectations and reality.
Most studies of doing business at the "bottom of the economic pyramid" focus on viewing the poor as consumers, as micro-entrepreneurs, or as potential employees of local companies. Almost no analysis focuses on the poor as primary producers of agricultural commodities a striking omission given that primary producers are by far the largest segment of the working-age population in developing economies.Making Markets More Inclusive bridges the management literature with original research on agricultural value chains in developing and emerging economies. This exciting work is the first to delve into the skills, capabilities, strategies and approaches needed for inclusive value chain development. McKague shows how NGOs and companies can connect poor producers in developing economies with the right markets to better create social and economic impact. He also analyzes one of the leading agricultural value chain initiatives in the world, which is being replicated by the Bill and Melinda Gates Foundation in several different value chains in Malawi, Tanzania, Ghana, India, and Mali.Want more? Check out these compelling videos, which provide a glimpse into the stories and examples used throughout the book.Video Trailer for Making Markets More Inclusive. Farmer Training. Kallani Rani increased the productivity of her cows, become a cattle feed seller in her village (Chapter 6), and opened a fresh milk canteen in her local market (Chapter 7). She now trains other women farmers and works to improve opportunities for women in her community (Chapter 5).Animal Health Care Services. Asma Husna trained to be an animal health worker with CARE to provide important animal health services and education to local farmers on a fee-for-service basis (Chapter 6).Cattle Feed Shops. Fulera Akter started a business as a cattle feed seller after demand for nutritional animal feed grew due to farmers' improved knowledge of nutrition (Chapter 6).Savings Groups. Coauthor Muhammad Siddiquee, the Coordinator of Agriculture and Value Chain Programs at CARE Bangladesh, discusses the value of farmer savings groups (Chapter 6).Milk Collection. Sarothi Rani became a milk collector to earn an improved income for her family and provide an important service to other dairy farmers in her community (Chapter 7).Digital Fat Testing. Introducing digital fat testing machines into the dairy value chain helped reward farmers for making investments in producing higher quality milk, as well as ensuring transparent and timely payments (Chapter 7).Microfranchising. Supporting agricultural input shop owners with training, relationships to suppliers, common branding, and standardized customer services improves the productivity of smallholder farmers and the profitability of shops (Chapter 12).Bangladesh Dairy Value Chain Learning. Reflections from some of the 40 CARE staff from 17 countries who came to Bangladesh to learn from the experience of the dairy value chain project (Chapter 15).
Organic and Fairtrade certified coffees have become very popular among socially, environmentally and health conscious consumers in recent years. As consumers pay higher prices for these certified coffees, it is commonly assumed that, compared to conventional coffee, better producer prices are paid and that higher shares of the added value in consuming countries trickle down to the producers. Coffee certifications are thus supposed to benefit the coffee producers. Coffee is an important export good for many developing countries. The majority of global coffee production comes from around 20-25 million smallholder families in developing countries. As individual certifications are too expensive smallholders have to participate in farmer organizations, e.g. cooperatives, in order to access cheaper group certification. Governments and international donors support coffee certification schemes and assume that these link farmers to high-value markets, increase producers’ incomes, change power and information asymmetries in value chains, and contribute to poverty reduction. Yet, there is only weak empirical evidence that justifies this support. There are few quantitative studies which applied random sampling techniques, and analyzed the effects of certification schemes in regard of gross margins, profits, income shares and poverty levels of certified smallholder coffee producers. The role of cooperatives for the success of certification schemes has been neglected by research. The available studies have methodological limitations, for example they are based on qualitative methods only, include no more than one cooperative or one certification standard, or cooperatives are non-randomly sampled.This research seeks to fill the identified knowledge and methodological gaps. Through a combination of qualitative and quantitative research, the production and marketing strategies of small-scale coffee producers in northern Nicaragua are compared based on producers that are organized in conventional, organic, and Organic-Fairtrade certified cooperatives. The analysis addresses (i) the smallholders’ household level and (ii) the organizational and institutional level with regard of the cooperatives and respective coffee value chains. The study aims at, first, identifying the socio-economic costs and benefits of participation in organic and Organic-Fairtrade certified coffee chains with respect to level of coffee and household incomes as well as household poverty. Second, it is examined which role the farmer organizations, their respective business models and upgrading strategies, play for the success or failure of certification schemes. Third, the integration of coffee farmers and their cooperatives into the coffee value chain, the structure and functioning of the value chains and the value adding effect of certification is examined.The survey was conducted in the northern Nicaragua departments Madriz, Nueva Segovia, and Matagalpa on coffee farms situated between 900m and 1300m a.s.l. The coffee of all farmers was classified as ‘Strictly High Grown’, the species is Coffea Arabica. The sample design ensured that the research region was homogeneous with respect to living conditions, socio-economic level, as well as coffee growing characteristics driving performance of coffee farmers. After having randomly selected the cooperatives, 327 coffee producing households were also randomly selected and surveyed with a structured questionnaire. Qualitative data collection consisted in total of 58 key-person interviews, 67 semi-structured farmer interviews and 24 focus group discussions with coffee farmers. The primary data was collected during two research stays in 2007 and 2008.This research analyzes gross margins, accounting and economic profits of coffee production. The household income is measured and a poverty headcount index elaborated. Principal component analysis is used to determine current relative poverty levels and the development of relative poverty over time. A SWOT analysis identifies the strengths, weaknesses, opportunities, and threats of cooperatives. Through a value chain analysis information on the actors, power and information flows as well as price shares is gained. For identifying the farmers’ experiences with coffee certification schemes, a thematic analysis is applied to the qualitative data by developing an individual code system for datareduction.In the research region, the coffee yields of conventional and certified coffee smallholders are usually 40% to 50% lower than national average due to limited maintenance activities and inadequately managed coffee plantations. Highest yields (on average around 480kg/ha) are achieved by organic producers but yield levels vary, like for conventional and Organic-Fairtrade certified producers, between the cooperatives (ranging from 293kg/ha to 516kg/ha). In comparison to conventional prices, Organic-Fairtrade certified coffee achieved on average 11% and organic coffee 8% higher farm-gate prices, price differences between cooperatives also exist. Organic production processes require fewer purchased inputs but are more laborious. Due to constrained availability of family labor, additional labor has to be hired which offsets saved input costs. The higher prices of certified coffees compensate for production costs but fail to increase per hectare gross margins and profits in the case of Organic-Fairtrade farmers compared to conventional produces. Due to higher yield levels, organic producers experience an increase in per hectare gross margins and profits. They have with 328US$/ha a significantly higher economic profit than Organic-Fairtrade farmers (147US$/ha) and conventional farmers (191US$/ha). Yet, as they tend to have smaller coffee areas and larger family sizes, the increase in gross margins does not result in improved per capita net coffee incomes for organic certified producers compared to the other groups. Also Organic-Fairtrade certified producers do not have higher per capita net coffee incomes than conventional producers.Among organic and Organic-Fairtrade certified producers, a higher share of households is grouped below the extreme poverty line than among conventional producers (45% compared to 30%) – which means that they cannot cover their food requirements. Between 60% and 70% of conventional and certified coffee producers are below the national poverty line. Using principal component analysis to investigate several dimensions of poverty and their development over time, it was found that over a period of ten years, organic certified producers became relatively poorer. In the year 1997, all groups had similar relative poverty levels. The Organic-Fairtrade certified producers first improved their relative poverty status during the coffee crisis (in 2002) and were relatively better off than conventional producers. Since then, the relative poverty levels of Organic-Fairtrade producers deteriorated compared to conventional producers.Irrespective of whether farmers were certified or not, Nicaragua’s coffee smallholders face two to three months of food shortages per year during which they seek off-farm employment, and apply for formal and informal credits. In many cases the credit is used for immediate consumption needs, like food or medicine, and only partially invested in the farm. Consequently, harvested yields stay low, leading to low incomes and new credit requirements. When farmers are financially illiterate or requested higher credits than their payment capacity, they are likely to enter a vicious cycle of indebtedness.Each cooperative has a unique business model, they differ, for example, in member size, functions and services, internal organization, and financial characteristics. Despite their different business models the cooperatives often choose the same upgrading strategies as other cooperatives mainly certification, quality, and own processing. The analysis of strengths, weaknesses, opportunities, and threats (SWOTs) showed that the cooperatives have certain SWOTs in common but there are also cooperative specific SWOTs. The common strength of the cooperatives is the quality potential of the region. The common weaknesses relate to the lack of credit access, a weak extension system, and weak rural infrastructure. The common threats of the cooperatives are high competition among national coffee buyers and cooperatives, corruption and mismanagement, and, according to the qualitative interviews, increasing microclimatic variations and unreliable rainfall patterns. The common opportunities range from more horizontal coordination to reduce transaction costs to share certificates acknowledging the members’ possessions in the cooperative and increased transparency about deductions on payments. Qualitative evaluation indicated no obvious association between the coffee certification strategy of farmers/their cooperative and the coffee gross margins farmers obtained. The upgrading strategies of cooperatives, the strengths and weaknesses as well as the amount of coffee-related services, which the cooperative offers to producers, tend to be more related to coffee gross margins than the organic or Organic-Fairtrade certification.Farmers are found to have no bargaining power over prices irrespective of the value chain, while certified cooperatives have limited bargaining power towards their buyers compared to cooperatives in the conventional chain. Power is unequally distributed between buyers and sellers of coffee in all chains. The quantity and quality of information flows depends on the cooperative and value chain model. Information asymmetries are fewer in certified chains, yet this also depends on the cooperative. Organic-Fairtrade certified value chains tend to have more and smaller-sized actors, especially in consuming countries, compared to the conventional chain. This increases transaction costs in the certified value chains and thus leads to substantially lower producers’ share of the final coffee retail price (8%-15% in certified chains compared to 24%-34% in conventional chains).The presented results depend strongly on each cooperative and there are large variations within the organic and Organic-Fairtrade certified cooperatives. It can be concluded that higher farm-gate coffee prices do not lead necessarily to higher per capita net coffee and household income, as yield levels, production costs, family and land size, as well as labor availability play important roles.Organic or Organic-Fairtrade certification as an upgrading strategy seems only then successful when the business model of a cooperative, its strengths, weaknesses, and other upgrading strategies are supportive. Given the constraints mentioned above, a well functioning cooperative is a necessary but not sufficient condition. This was shown by the example of one well run Organic-Fairtrade certified cooperative with low gross margins showed.The main causes of continuing poverty among smallholder coffee growers in northern Nicaragua seem not the lack of market access or so-called ‘unfair’ trading conditions. Based on the qualitative analysis, reasons for poverty are lack of entrepreneurial and management skills of farmers and cooperative staff, financial illiteracy and indebtedness of farmers as well as a very weak rural infrastructure. Based on the quantitative results potential reasons for poverty are low yield and productivity levels, land and labor constraints. Certification schemes do not address or are able to solve these problems. Prices for certified coffee cannot compensate for low productivity, land or labor constraints.Therefore, certification schemes can only be part of a viable development policy for poor small-scale farmers in northern Nicaragua, the production, infrastructural, organizational and institutional problems mentioned above require even more attention from policy makers. It is recommended that policies, which aim at increasing smallholder coffee incomes through upgrading, should focus apart from production aspects on the institutional context of smallholders and their cooperatives. Regarding coffee production, policies should address coffee yield levels, for example through research investments in improved, stress-tolerant and locally adapted varieties to encounter the microclimatic variations. Coffee quality in the region should be further strengthened by a supportive coffee sector strategy at the national level, which should include a national coffee institute or federation like in Colombia or Costa Rica. This should be accompanied by investments in rural infrastructure. It is recommended to establish an efficient extension system which also addresses the entrepreneurial skills of farmers. This could be also in form of facilitating the establishment of extension associations which could operate regionally and be financed by their members’ contribution.In order to better link farmers to (high-value) markets and to increase their income, it is recommended to focus more on the structure and functioning of producer organizations and their respective value chains. Business and strategic advice to cooperatives is necessary, as cooperative leaders and staff are not fit for international markets, in which they have to act. A banking system which also provides credits to cooperatives (at market interest rates and lending conditions) would reduce the reliance and dependence on exporters or international credit providers and could ease liquidity constraints of cooperatives. An obligatory annual external auditing of cooperatives, like it exists in other countries, is considered to be important to reduce mismanagement of a cooperative. It will also increase the creditworthiness of cooperatives for banks.Trade, processing, and marketing efficiencies in the organic but especially in the Fairtrade value chains in consuming countries need to be improved in the alternative trade sector with its many small profit or non-profit enterprizes and organizations. These actors could consolidate to exert economies of scale and reduce their transaction costs. Consolidation is certainly a new way of thinking in the alternative trade sector but could effectively contribute to improve farmers’ shares of retail prices and raise farm-gate coffee prices.
Dairy marketing cooperatives are one type of agricultural cooperatives in which milk producer farmers come together to sell their products where there is market, and access services which is not easily accessible individually. Promoting these cooperatives, as a means of linking smallholders to markets, is a key pillar of Ethiopia's rural development strategy. They are the newly emerging marketing outlet for Ethiopian smallholder milk producers, but the opportunity is not yet accessed to the required extent by most milk producer farmers. This work therefore focuses on identifying the demographic, socioeconomic and institutional factors affecting dairy farmers' perception and decision on cooperative membership. This helps to formulate intervention areas and implement strategic measures to maximize dairy farmers' production and productivity, and hence both self and group business increases for the betterment of their livelihood and realize sustainable food security. It also contributes research gap for students & researchers who are curious to do in the area.
In many developing countries, the contribution of small scale farmers to the high value cut flower export business has been minimal and on the decline. Besides lack of capital, high costs of technology, strict market access regulations and weak management skills, the exclusion of small scale farmers also results from their weak capabilities to innovate and respond to changes in the technological, institutional and governance contexts. This book examines the role of partnerships between farmers and exporters in building farmers innovation capabilities. The book applies the lenses of innovation systems and value chain analysis to examine how institutions, power dynamics and governance patterns influence the opportunities for interactions, learning and innovation within these partnerships. The findings will be useful to policymakers, development practitioners, researchers, graduate students as well as development organizations seeking to enhance the participation of smallholder farmers into agricultural export markets.