Farmer segmentation: how companies can effectively target support for smallholder farmers in global supply chains

Smallholder farmers make an essential contribution to global food supply chains, producing a third of the food consumed worldwide and 80 per cent of the food consumed in large parts of the developing world.

Despite this key contribution, 80 percent of the world’s extreme poor live in rural areas and mainly work in farming. They also face numerous interconnected  challenges, including difficulties accessing agricultural inputs, finance, and markets and the impacts of climate change.

Procurement practices have the power to significantly affect smallholder farmers’ incomes – whether by helping to increase them or inadvertently keeping them low.  Procurement teams play a critical role in delivering corporate sustainability and responsible sourcing strategies. 

This toolkit for procurement teams provides:

• an explanation of what farmer segmentation is and how it can benefit both farmers and businesses
• an overview of the basic steps that any company would take to get started with farmer segmentation
• examples of how segmentation has been applied to help businesses reach their objectives, while helping improve smallholder livelihoods.