African Business: Integrating Smallholder Farmers Into Supply Chain

About 70 percent of Africans rely on agriculture for their livelihoods, and growth in the sector reduces poverty. Some small farmers struggle to find markets and hesitate to expand, and business leaders suggest connections with larger supply chains. “Yet this is easier said than done,” explains Tom Collins for African Business. “Although large producers build smallholder capacity to secure crop, they often face their own financial constraints and are by no means a silver bullet.” Larger companies can develop a network of dependable suppliers by providing assistance with financing, storage and transport to prevent losses. Advice and standards can reduce rejection rates. Among the challenges is varied demand from year to year. Collins concludes that farmers can join commodity exchanges or agree to multi-year contracts, both of which can stabilize relationships and supplies. Clear forecasts and communications are required. – YaleGlobal