Programme profile

FTF Inova: Mozambique Agricultural Innovations Activity

Programme Index Listing

Location
Mozambique
Main implementer
DAI
Other implementers
TechnoServe, MarketShare Associates, EcoVentures International
Donor
USAID Feed the Future
Duration
Feb 2017 - Feb 2022
Total budget
USD $20.9 million
Annual budget
USD $4.2 million
Contact
Luca Crudeli
External links
MarketLinks blog

Project description / objective

To increase equitable growth and incomes in the agriculture sector in Mozambique by:

  • increasing the competitiveness of value chains with potential to drive long-term, sustainable, inclusive growth
  • expanding the number of enterprises that can compete and upgrade their products and services
  • improving relationships and linkages between those firms and other market participants throughout the agricultural market system

Market system focus

Agricultural inputs distribution system

FTF Inova is facilitating behaviour change within the inputs distribution network system. Its main objective is to support firms to expand their market while reaching smallholder farmers, for instance through products better tailored to their needs and budgets, new distribution models that can handle large volumes of inputs, and last-mile distribution tactics based on close collaboration with farming communities.

Supply chain management system

FTF Inova's objective is to improve the networks connecting farmers, processors, traders, buyers, aggregators, transporters, sellers and consumers. It identifies partners in this system that wish to test innovations that could make them more competitive and better connected with Mozambican farmers. For instance the use of new management approaches to organise firms’ (smallholder farmer) suppliers, upgrading their supplier base and facilities and obtaining certifications to reach higher-value markets. This increases consumer demand for Mozambican agricultural products and improves the logistics systems to deliver them whilst building strategic alliances among offtakers.

Supporting systems

Essential supporting functions in Mozambique are thin. FTF Inova is working to change this pattern through partnerships with logistics, marketing and ICT firms, along with universities and community radios. By identifying potential first-movers market actors who are interested in developing better services in the agricultural sector - and working with them to test new approaches and products - FTF Inova can demonstrate that there is an addressable market in the agricultural sector and motivate other market actors to follow suit.

Programme interventions

Agricultural inputs distribution system

Inova aims to:

  • help input companies improve the performance of their distribution networks
  • expand retail of inputs by improving the value of products and services for smallholder farmers
  • improve efficiency in the system and reduce operational costs for agri-businesses by facilitating the development of strategic partnerships
  • support input companies to adopt evidence-based management processes so they can continue to innovate

The interventions in the agricultural inputs distribution system will:

  • facilitate an inclusive business model for the retail of inputs in the last mile, including re-thinking the approach to last-mile logistics
  • increase collaboration between input sellers and end-market buyers to improve quality and quantity of production
  • support input dealers to adopt collaborative business models that share price and technical information with their customers
  • support input distributors and retailers to adopt new marketing approaches to sell improved inputs to smallholder farmers

Supply chain management system

FTF Inova is supporting innovative ideas that help agri-commodity buyers improve:

  • the performance of their supplier base, in terms of quantity and quality
  • the efficiency of their operations through establishing strategic partnerships with other market actors
  • continued innovation through the adoption of evidence-based management processes

Interventions in supply chain management will also facilitate the expansion of export market options while incentivising investment in the supply chain through:

  • developing new approaches to managing smallholder suppliers (farmer performance clubs, for example) to permit long-term investment by the commodity buyer in smallholder farms and incentivise improvements in crop quality that make the buyer more competitive
  • improving food certification services offered by national service providers and investing in certifications for industry leaders
  • establishing certifiable supply chain traceability
  • support for innovations quality testing, sorting and grading at the farm gate, to improve products in domestic trade

Supporting systems

FTF Inova aims to facilitate the growth of:

  • marketing, finance, logistics, ICT and other services that are adapted for businesses in the agricultural sector
  • the role of academia as both a repository of technical and management knowledge and as a supplier of the future agribusiness workforce
  • community-level media that serves as a voice for farmers and acts as a feedback mechanism between businesses and farmers
  • alliances among agricultural market actors through associations that can convene and advocate for member businesses and organisations and facilitate the sharing of information between them

FTF Inova is pursuing support-service interventions:

  • with logistics service providers to offer affordable, flexible warehousing and distribution services to input firms and backhauling space to output buyers
  • with marketing firms to develop products and services tailored to the agricultural market
  • with ICT firms to find affordable ICT solutions for agri-businesses
  • with financial institutions to develop better ways to provide credit or insurance products for agri-businesses
  • with higher-education institutions to better prepare students for careers in the agricultural sector and to provide services to agri-businesses through internships
  • with community radios to disseminate more valuable information about agriculture to their listeners and to give smallholder farmers a voice in the market system

Notable results (systemic change, poverty impact)

Agricultural inputs distribution system

  • In partnership with FTF Inova, one inputs distributor has launched a network of eight distribution routes in Manica and Nampula provinces. Trucks deliver orders to participating agro-dealers on a predictable weekly schedule. This has helped improve access to inputs for 13,000 farmers as of late 2019.
  • A seed manufacturer partnered with FTF Inova to introduce direct marketing tactics into its approach. It launched a series of road shows to promote its products with smallholder farmers and gather feedback directly from these end customers. By the end of 2019 they have reached 2,000 farmers.
  • Two retailers working with FTF Inova implemented a village-based agent (VBA) model to create a pre-order system driven by trusted community members who function as agents for the retailer. The system is growing, with 40 agents across four districts by late 2019.

Supply chain management system

  • A major cashew exporter partnering with FTF Inova upgraded its infrastructure and human capacity to receive British Retail Consortium (BRC) certification (anticipated in 2020), which will allow them to access higher-value markets and pass along an 8 per cent price premium to investments in its 10,000-strong supplier base.
  • A Maputo supermarket chain eager to develop a partnership with FTF Inova began in 2019 to stock and sell specialty products from Niassa and Zambézia provinces to consumers who are willing to pay a premium for certain products (like beans, rice, and tea) produced in Mozambique.
  • Two commodity buyers receiving support from FTF Inova introduced performance management schemes in 2019 in order to manage their supplier bases to generate more, better produce with less side-selling. So far these are just pilots with a few hundred suppliers in each, but there is potential for these buyers to expand to tens of thousands if they reach their entire supplier base.

Supporting systems

  • Two marketing and market-research firms invested in tailored and affordable marketing services for agricultural input companies, with guidance from FTF Inova. They will expand these new services in 2020.
  • Three higher-education institution partners of FTF Inova integrated business-oriented, practical tools into their curricula for student interns, seven of whom completed internships in 2018 - 2019 at four agribusinesses to support the adoption of customer-centred innovations.
  • Fifteen community radios receiving support from FTF Inova aired new programming in 2018 - 2019 focused on farmers, and two of them have demonstrated the business case (via sponsorships) for farmer feedback programmes.

[updated January 2020]

  • Read Dan Langfitt's blog: Working with the private sector for systemic change: why build a partnership facility in the first place?

Share