The Innovative Practice Series of the Regoverning Markets programme are 30 different case studies providing examples of specific innovation in connecting small-scale producers with dynamic markets at local or regional level.
Selection
Based on significant fieldwork activities, the variation of the following four factors was critical in selection of the case studies:
- Stage of Restructuring - countries in different stages of market restructuring;
- Procurement Systems that vary in their stage of development
- Forms of Inclusion in chain development
- Drivers for Inclusion - highlighting the role of different drivers for inclusion
Content
Across the case studies the following common questions are asked:
- The innovation and its context: What are the main characteristics of the innovation and its immediate context, both at the level of the supply chain and of directly relevant meso and macro trends, policies and institutions?
- Evolution: How did the innovation emerge over time and how did its evolution lead to greater inclusion of small-scale farmers and/or rural SMEs? What were the key incentives faced by small-scale farmers? What were the critical stages and the critical factors in the evolution of the innovation?
- Evidence of inclusion: What are the costs and benefits of the innovation, and how are they distributed across different actors in the supply chain? What is the evidence of effectively greater inclusion of small farmers and/or rural SMEs, as a result of the innovation? What did the small farmers and/or rural SMEs gain or loose? Are these results sustainable?
- Drivers: What explains the greater degree of inclusion? What were the key drivers in terms of policy principles, business models, collective action and support systems?
- And now what...? What is the potential for upscaling or replication? What are the key challenges?
The studies highlight policy lessons and suggest working methods to guide public and private actors.
A brief description of each Innovative Practice study is given below along with a link to the executive summary and full report download.
Innovative practice in connecting small-scale producers with dynamic markets: synthesis report [0]
This paper synthesizes 38 empirical case studies where small-scale farmers and businesses connected successfully to dynamic markets, doing business with agri-processors and supermarkets. The studies aimed to derive models, strategies and policy principles to guide public and private sector actors in promoting greater participation of small-scale producers in dynamic markets.
Innovative Practice Brazil: Brazil Access of family farmers to biodiesel markets [0]
The force of national, and increasingly, international interests linked to sugarcane importance and expansion seem to confirm the prediction made in Foreign Affairs magazine that the history of the industrial demand for agricultural products in developing countries benefits the largest producers. Nonetheless, parallel to the expansion of the alcohol plants, the Brazilian government has begun to implement a policy that supports the production of biodiesel. In contrast to the policy for the national supply of alcohol from sugarcane, the National Program for the Production and use of Biodiesel (PNPB) is clearly aimed at integrating family farmers into the production of biofuels and, as a result, contributing to their ability to generate income.
Innovative Practice Bulgaria: Inclusion of small scale dairy farms in the supply chain in Bulgaria - a case study from the Plovdiv region [0]
This paper presents a business model for an effective market inclusion of numerous small scale dairy farms from the Plovdiv region developed by a private entrepreneur. The "Dimitar Madzarov" Ltd dairy was set up in first years of the transition and successfully modernised up to the highest industry standards. This enterprise has managed to adapt to the dynamic market and institutional environment, effectively governing relations with supplying farmers and downstream partners.
Innovative Practice China: Market chain changes in a small-farm economy: A case study of mushrooms in China [0]
The overall goal of this study is to gain a better understanding of Lanbo's mushroom marketing chain and its impact on small farmers. We conducted two surveys to achieve this: one primarily based on interviews with Lanbo's manager and designated agent, and the other based on a micro-farming household survey in two villages where farmers sell their mushrooms to the agent.
Innovative Practice China: Supermarket penetration in rural China: The Suguo model and its impacts on smallholders and SMEs [0]
The case study focused on Suguo's supermarket business model and its impacts on smallholders and SMEs. The innovations in this case are twofold: the supermarket penetrated the rural market by extending its network of stores gradually from metropolitan cities into the countryside, and it expanded its market share by offering franchises to cooperatives.
Innovative Practice China: Collective action by small-farm households in big markets - Ruoheng farmer watermelon cooperative [0]
This paper chose the Ruoheng farmer watermelon cooperative to research, and analyses the institutional innovation that they have made to meet the challenges of large markets as a participant in the supply chain.
Innovative Practice China: Case Studies of Carrefour's Quality Lines [0]
[0]Carrefour entered the Chinese market with an innovative demand: the adoption of quality lines. The quality line is the control and supervising line conducted on raw and fresh agri-food. The standards are set from planting, processing and circulating in order to guarantee the quality and safety of products. To better control production Carrefour gives training and assistance to farmers along with a strong coordination of quality standards. Because small scale farmers are difficult to control, Carrefour works mainly with large scale farmers.
Innovative Practice Colombia: From the Amazon to the supermarket: Innovation and the integration of small-scale Amazonian chilli pepper producers [0]
This document provides an in-depth description of the innovation processes involved in forming links between small-scale producers in the Colombian Amazon and supermarkets in Bogota in order to market chilli pepper sauces and Amazonian fruits as local biodiversity products. Small-scale producers have accessed dynamic markets as a result of the formation of a broad network made up of research institutions, universities, non-governmental organisations, ministries and private sector entities. Small-scale farmers need new capacities and forms of organisation in order to deal with entry conditions and standards in these markets, and this has presented a great challenge to them.
Innovative Practice Guatemala: The experience of small producers in competitive markets - a case study of OPCION/Aj Ticonel [0]
The alliance OPCION / AJ-TICONEL in Guatemala develops coaching activities in productive, commercial and organizational processes with the aim to generate increased economic returns and improved living conditions for smallholder farmers in extreme poor regions. The main activity consists in the commercialization (at both national and international level) of non-traditional vegetables. The innovation was developed through combined action of the NGO OPCION and the private business Aj Ticonel, both founded in 1999.
Innovative Practice Honduras: Innovaciones Organizacionales de Pequeños Productores de Vegetales para Participar en Canales de Comercialización Dinámicos en Honduras [0]
By Iván Rodríguez
Innovative Practice Hungary: Successful cooperatives in the Hungarian poultry sector [0]
This case study is about an agricultural cooperative, AVIUM, and a poultry processing cooperative, AVIUM 2000 in the Besnyő village, Hungary. AVIUM agricultural cooperative is a "new type" purchase and marketing cooperative. It was founded in 1993 - after the new cooperative law came into force - to reduce costs and offer agricultural related services. AVIUM had the aim to concentrate the supply of live chicken and to organize the joint procurement of inputs. However, in the region of AVIUM small-medium sized processors were not present. To fill this market niche and to acquire the market security and profit surplus, five members of the agricultural cooperative established in 1999 AVIUM 2000 poultry processing cooperative.
Innovative Practice Hungary: Morakert Cooperative - a successful case of linking small farmers to markets for horticultural produce in Hungary [0]
The case study is about Mórakert Purchasing and Service Cooperative, in Mórahalom town, Hungary. Approximately 75 per cent of the population of Mórahalom is involved in agriculture. The most important crops are vegetables, the basis of commodity production. The Mórakert cooperative is active in the vegetable and fruit sectors and it was the first officially acknowledged Producers' Organisation (PO) in Hungary. It works as a successful cooperative in terms of increasing annual turnover and membership. The members of Mórakert coop are organized small-scale farmers. The average land size of the members is 25 hectares, whilst 31% of them rent extra land. 88% of members use family labour, whilst 48% employ paid labour. On average, members joined the cooperative 4 years ago.
Innovative Practice India: Marketing cooperatives in a new retail context: A case study of HOPCOMS [0]
India has a rich tradition of successful public sector institutions that have empowered small producers by aggregating their interests into state-managed co-operatives. In this study, set within the larger framework of the Regoverning Markets Project, we look at one such statemanaged farmer co-operative-the Horticulture Producers Co-operative Marketing and Processing Society Limited (HOPCOMS)-in the south Indian state of Karnataka. With its focus on vertical co-ordination and disintermediation, we argue that HOPCOMS, and institutions like it, can perform an innovative role in the new retail landscape.
Innovative Practice Indonesia: The transparent margin partnership model: Linking mango farmers to dynamic markets [0]
The main objective of the study is to generate policy lessons and working methods to guide public policy makers and private actors in supporting greater inclusion of small-scale producers in dynamic markets. The study shows that the transparent margin system is a co-innovating marketing institution which provides small farmers access to a modern market supply chain. Evolution of the innovation has created dynamic changes at the producer level. Factors that support small farmer inclusion are the farmer's ability, willingness, and trust to make changes, and receive its benefit.
Sustainability of the transparent margin system is dependent on commitment, level of trust in the partnership, the transformation of marketing institution, an innovative learning process, risk managements, and the role of rural production organisation in the marketing system. The innovation of the partnership can be replicated by facilitating and giving incentives to the supply chain champion.
Innovative Practice Kenya: Access to high value markets by smallholders of African indigenous Vegetables [0]
The collective action by small-scale farmers in Githunguri area (Central Kenya) started in 2001 when FAO through Farmers' field schools organized farmers and provided capital that could support farmers in training on various enterprises or opportunities. The groups were formed as a bargaining platform for the poor small-scale farmers, who were being exploited by the brokers and traders in the local markets. Following poor performance in floriculture, the farmers in 2004 explored other avenues with the help of a development agency, Family Concern. As a result of all these efforts, the supply of the African indigenous vegetables to the major supply chains has increased dramatically.
Innovative Practice Maroc: Une etude de cas de COPAG [0]
Innovative Practice Morocco: A case study on the agricultural cooperative COPAG [0]
The milk and dairy sector is one branch of the food industry that has gone through the most rapid restructuring. This is partly due to the economic incentives offered by the State (the milk plan), but mainly to the organisational capacities of small and medium-sized producers. Although many cooperatives coming into the market have failed, there have been a number of successes, the biggest of which is undoubtedly COPAG, an agricultural cooperative based in the region of Souss Massa.
Innovative Practice Pakistan: A case study of mlk production and marketing by small and medium scale contract farmers of Haleeb Foods Ltd [0]
Pakistan is the fourth largest milk producer in the world. About a third of the total milk produced by the rural families flows out to urban consumers and processing industries. In urban areas milk is available to common consumers in two ways: loose / unprocessed milk and packed / processed milk. Dairy companies such as Nestle and Haleeb are the main part of milk marketing structure. Haleeb Foods Limited (HFL) is a local company that is at the forefront of product and packaging innovation.
Innovative Practice Philippines: The case of NorminVeggies in the Philippines [0]
This case discusses the strategies of a group of farmers called the Northern Mindanao Vegetable Producers' Association or NorminVeggies, who were able to successfully market their products by using a business model not previously used in the Philippine vegetable industry. Its organizational structure and marketing clusters enabled the farmers to be responsive to the constantly changing market.
Innovative Practice Philippines: Keys to Inclusion of Small-Scale Organic Rice Producers in Supermarkets - The Case of Upland Marketing Foundation Inc. [0]
This study examines a case of successful linkage of small organic rice farmers to supermarkets. These small-scale farmers have tapped opportunities brought about by the changing markets in the Philippines where supermarkets continue to improve patronage from consumers who demand convenience as incomes improve and lifestyles change. This was possible through the innovations and strategies made by Upland Marketing Foundation, Incorporated (UMFI) who acts as marketing consolidator for supermarkets buying from organized groups of organic rice farmers such as the Pecuaria Development Cooperative, Incorporated (PDCI).
Innovative Practice Russia: Innovative practices connecting smallholder producers with dynamic supply chains: A case study of small-scale tomato producers in the Astrakhan region of Russia [0]
This report presents a case study of a reactive private business initiative in the tomato (vegetable) sector of the Astrakhan region. Astrakhan tomatoes have a strong reputation in the Russian domestic market and consumers prefer to buy them fresh and unprocessed.
Innovative Practice South Africa: The inclusion and empowerment of farmers through partnerships - the case of Thandi fruit and wine [0]
The case study of Thandi Fruit and Wine in South Africa shows that farmers were in need of support to meet the needs of the market. Vineyard and orchard skills were not enough to launch a successful farming operation. As a response, Thandi was built on a new business model based on empowerment through partnerships. It was started in 1996 by a farmer in the Elgin region of the Western Cape, Paul Clüver. The Thandi empowerment concept was based on an innovative business model. The fruit and wine were to be sold at the top end of the price ladder (as a brand) and in international markets. Although originated on empowerment farms, the products would have to stand or fall on the basis of their quality.
Innovative Practice South Africa: New trends in supermarket procurement systems - The case of local procurement schemes from small-scale farmers by rural-based retail chain stores [0]
In contrast to the centralized fresh produce procurement systems of South African ‘retailers relying on preferred commercial suppliers, this paper draws on an in-depth analysis of the innovative procurement schemes of two rural-based supermarket chain stores in the Limpopo Province to source fresh vegetables locally from small-scale farmers. The objective is to derive lessons to guide public and private sector actors in promoting greater participation of small-scale producers in dynamic supply chains, through the exposure of the key drivers and success factors affecting the inclusion of small-scale vegetable farmers.
Innovative Practice Sri Lanka: Integrating small farmers into dynamic supply chains - case study of Ma's tropical fruit company [0]
The traditional supply chain of spices in Sri Lanka consists mainly of small scale producers. Over 200,000 small scale growers are involved in spice cultivation where 70% of production comes from small holder farm units of less than 1 ha of land. Many of them are part time farmers with other sources of income. Only a small group of producers have commercial orientation and are willing to improve productivity. Because of this lack of investment, the supply chain has some fundamental problems that need to be dealt with: 1) purchasing is decentralized; 2) the quality of products is low; 3) there is a strong presence of middle-men in the chain. These limitations are affecting the competitiveness of smallholders who grow spices for the domestic and export markets.
Innovative Practice Thailand: Innovative practice in integrating small farmers into dynamic supply chains: CMK housewives' group in potato chips [0]
This paper attempts to illustrate the performance of a community
enterprise that has gained inclusion in the potato products supply chain by turning unwanted potatoes into usable material and also to highlight the role of a potato housewives' group in providing an alternative for growers' market participation.
Innovative Practice Togo: Promotion d'Enterprises de Services et Organisations de Producteurs (ESOP) [0]
Innovative Practice Togo: Promoting service provider and producer organisations: A case study of Soja NYO [0]
This case study on the Togolese company Soja Nyo describes an innovative mechanism for including small producers in a dynamic sector of the agrifood market: the soya commodity chain. Service provider and producer organisations (SPPOs) are an organisational innovation that have been put in place with support from the Centre International de Développement et de Recherche (CIDR) to enable small producers in various African countries to gain sustainable access to more lucrative markets, by involving them in strategies and decision-making downstream from their production.
Innovative Practice Turkey: A win-win relationship between a producers' union and a supermarket chain in the Turkish fresh fruit and vegetables sector [0]
The present paper focuses on the success story of a village development cooperative that has been a producers' union since 1995, and contracts directly with a supermarket.
This case illustrates a 'win-win' relationship between producers and buyers.
Innovative Practice Uganda: The case of the Nyabyumba United Farmers Group in Kabale district [0]
Marketing agricultural commodities continues to be a salient issue particularly for small-scale producers due to rapid changes that are taking place in agrifood markets in middle and low-income countries. Yet public policy makers and development partners lack evidence upon which to support policy dialogue and intervention. The Regoverning Markets programme was set up to provide support for market research with an overall objective of providing strategic advice and guidance to the public sector, agrifood chain actors, civil society organizations and development agencies on approaches that can anticipate and manage the impacts of the dynamic changes in the local and regional markets.
Due to its success with connecting small producers to better markets, the programme selected the Nyabyumba United Farmers Group as one of the case studies to be documented. The case study demonstrates the main characteristics of innovation, how it has emerged over time and how its evolution has led to greater inclusion of small-scale farmers.