Sustainable Agricultural Business for Small Landholder Farmers.

Management services for organized farmers are needed for the sustainability of the organization.

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I confirm that I am fully aware of the eligibility criteria, and based on its description, I am eligible to apply to the CSV Prize 2017.

  • Yes, I'm eligible

Preferred language

  • English

Organization name

Sustainable Agricultural Business (SAB)

Year founded

2014

Initiative stage

  • Start-Up (a pilot that has just started operating)

Annual budget in 2017 (USD)

  • $1k - $10k

Number of beneficiaries impacted so far

  • 10 - 50

Organization type

  • Social enterprise

Secondary Focus Area

  • Nutrition

Headquarters location: Country

  • Peru

Headquarters location: City

Arequipa

Location(s) of impact

Peru: Arequipa

Website

http://sabperu.com (under development)

Facebook URL

https://web.facebook.com/SAB-PERU-694411130660159/

Problem: What problem is this initiative trying to address?

A vicious value chain which does not allow farmers to earn fair prices for their products. Organized farmers can not overcome this problem because their oganizations are not ready to compete with other businesses. This happens because these organizations can not hire professionals with the right expertise to help them develop their businesses.

Solution Summary: What is the proposed solution? What do you see as its most promising aspects for creating shared value?

A management team formed by highly qualified professionals all at the service of the farmers' organizations working under a win-win agreement.
Right now, we are working with an agricutural cooperative. As our agreement states, we make sure this organization gets all the professional support needed to flourish. To begin with, we helped them become a legal person so they can sign agreements (as the one we signed with a University so they can get technical advice cost zero), apply for funding (as the one we just got from the Peruvian Minister of Agriculture), and be able of selling their products legally under a brand, paying taxes and developing as a responsible business. For achieving all these, the management service provided a lawyer, a manager, an accountant and a sustainability specialist.

Impact: What is the impact of the work to date? Specify both the social and the environmental impact of your work

The impact now a days is all concentrated in our pilot organization: Cooperativa Agropecuaria San Camilo La Nueva Joya Ltda. SAB is helping this organization developed to achive their goals. Socially, there are 50 women involved which will improve their income in 20% because of the better performance of the cooperative. Environmentally, there will be an improvement on the way this women raise hens to produce eggs. The new techniques they will learn take into consideration animal welfare and a better management of the excrements to reduce environmental impact. On top of that, and as an important part of the service, we secure market (selling channels) for the cooperative products. Only when their products generate profit (by selling them) we will also make a profit.

Financial sustainability plan: How is this initiative financially supported? How will you ensure its financial sustainability long-term?

So far, this initiative is financially supported with our own money. To ensure the financial sustainability we will earn a percentage of the total selling of the cooperatives we work with. Because our service is not consultancy, but rather a long term partnership, the development of the cooperative due to SAB's work well done, also means the development of SAB on the long term. Therefore, an important part of the service/partnership is to secure the market for the cooperative products. We are currently working on developing sale channels by signing agreements with local governments, universities and other business wich will allow us to reach the final client. SAB earns a percentage of the total sale.

Unique value proposition: What makes your initiative innovative? How does your project differ from other organizations working in the same field?

There is no other organization offering long term services for organized farmers in rural areas. The majority of the organizations (NGO, Consultancy) can not secure a long term relationship for the organizations therefore the impact they generate does not last on time resulting on the extinction of the farmers' organizations. Even more, some other social enterprises in Peru (working with fisherman) help these organizations to reach market but do not participate in the integral management.

Founding story: Share a story about the "Aha!" moment that sparked the beginning of this initiative.

Ones I was visiting my uncle's farm and I saw how he was basically forced to sell the potatoes he just harvest for 0.20 cents per kg. The next day I went to the maket and the price of the potatoes was 2.00 soles per kg. Why my uncle got so little money when he did all the hard work? Who is getting the profit he should have gotten?. How could I make a change?. After this experience I decided to academically prepared myself, and after I got to work closelly with farmers' organizations (quinoa, coffee, cacao, corn, fish) gaining relevant experience. I learned that these organizations have serious management problems because of lack of expertise motivation and commitment.
I have made a personal purpose to change the situation of the farmers and help them break the vicious value chain they are into.

Where did you hear about the Nestlé Creating Shared Value Prize?

  • Social media

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