Existing and Potential Business Models on Last-Mile Delivery of Seed
No one model of seed delivery will be able to meet all needs of rural small-scale farmers; but what combination of different ingredients will produce models that are able to drive more quality seed and inputs to farmers in rural sub-Saharan Africa?
The Feed the Future Global Supporting Seed Systems for Development activity (S34D) reviewed a dozen existing last-mile seed delivery models and proposed half a dozen potential last-mile seed delivery models. More detail of this review can be found in this report.
Informal sector vital in seed delivery
One study indicates that “farmers access 90.2 percent of their seed from informal systems with 50.9 percent of that deriving from local markets.” This provides an imperative to support the informal sector as a vital source of seed delivery for most farmers. Activities should be decentralized and revolve around local entrepreneurship, seed banking, community-based seed production or seed villages. To improve national and local supply, efforts should link formal and informal seed systems while improving the latter. Smallholder seed production systems can improve seed quality while increasing variety and access by borrowing from the practices of the formal seed sector. This would increase the flow of new, highly producing seed varieties to meet demand and increase smallholder productivity using already existing informal networks.
To better understand how informal/formal linkages could be created, interviews were conducted with seed companies, financial institutions, nongovernmental organizations involved in agriculture development projects in the region, innovative information technology providers, agrodealers and farmers. These interviews provide insights about the various models that provide seed delivery, how they can be improved to meet farmers’ needs and how they can contribute to food and livelihoods security.
Examples from other industries
Which models, then, can best address the gap between service providers and farmers? Findings indicate the agriculture sector needs to borrow examples from other industries and tweak them to suit the special requirements in the seed industry. The rural farmer is underserved and should be viewed as a potential game-changer for many businesses working in this landscape. This market segment should be targeted as a viable business opportunity by value chain actors using innovative approaches and technological advancements. Awareness, access, affordability and availability are key ingredients for the penetration of improved seed varieties in this market.
Six models that incorporate these key ingredients are discussed in detail in the report. Those examined include models to solve price and knowledge challenges. Such models include the Micro-Franchising Model and approaches to solve access and quantity factors such as the Motorcycle Distribution Agents Model. All models examined address key issues:
- Right seed: seed of the crop and variety as desired by the farmer.
- Right quantity: amount of seed required by the farmer in relation to the area that they plan to cultivate during that season.
- Right time: seed is accessible in time for planting. This is considering that the need for seed is seasonally time-bound especially in the case of rain-fed agriculture which is what most of sub-Saharan farmers rely on.
- Right place: sales and distribution location is within the farmer’s zone of mobility.
- Right condition: verifiable high seed quality in all attributes.
- Right price: price the farmer can afford and is willing to pay.
- Right planting information: correct agronomic practice for that crop variety, e.g., spacing, weeding, and pest and disease control.
To learn more about the exciting and potential last-mile delivery models with high potential to close the seed gap for smallholder farmers, view the whole report.