Kieni Dairy Products limited (KDPL) is a processor of dairy products working with 7 dairy cooperatives that represent 1,800 small-scale farmers. Together, these farmers supply 10,000L of milk a day. KDPL processes pasteurized milk and yoghurt which they sell on the local market in the Nyeri County in Kenya.
The yoghurt production is still relatively new and small for KDPL. At the beginning of 2018, KDPL was selling 10L of yoghurt in unbranded, re-used bottles a day. This was a nice start in processing fresh milk, but at the same time, KDPL struggled to bring it to scale and make it more aspirational. A higher yoghurt production would be essential to guarantee a more stable market, and so a stable price of the milk for the farmers. Therefore, they became a partner of 2SCALE in 2018.
The region of Kieni has a semi-arid climate, which is very favourable for dairy production. However, this means there is a dry and rainy season. In the dry season, there is a shortage of milk, while in the rainy season, there is a surplus of milk production which results in drastically dropping milk prices. When KDPL can stabilize their prices for milk through yoghurt production, they can build a trust relationship with the farmers and through this a more consistent supply of milk.
For KDPL it was important to improve the quality of the milk bought from the farmers and the yoghurt produced. The farmers were supported by 2SCALE by improving their access to good quality feed and fodder for their animals. Next to this, 2SCALE worked with KDPL on improving the quality of their yoghurt together with a food technologist. The shelf life of the yoghurt was improved by using the right stabilizer and bacterial culture. After this consumers mentioned that “the yoghurt is not like the others, it is smooth and tastes nice and it is not acidic”. Lastly, the product was also certified on food safety by the Kenya Bureau of standards(KeBs).
As creating an attractive product is not only about what’s inside, but also about how it looks, a marketing and branding workshop was held by 2SCALE with KDPL management and staff to come up with a new brand and design for the packaging of the yoghurt, as well as other promotional materials.
Distributing product to low-income consumers is not easy, KDPL chose to distribute through existing retailers and doing door to door (D2D) sales with sales agents. The sales agents receive a margin on the product and a commission from KDPL. One of the agents said: “Nowadays, I am earning Ksh.15 from each packet of 250ml Peak dairies sold, with a good day I earn extra Ksh.300!” Currently, the sales agents are not able to make a full living out of the sales and have to combine it with other jobs. One of the next steps is to introduce new products that the ladies can sell together with the yoghurt to make more margins. Also, KDPL is testing a new distribution channel with boda-boda (motorbike) drivers, often operated by youth, which will give youth in the area new opportunities for employment.
To boost demand for the yoghurt, KDPL and 2SCALE designed a market activation approach, focused on making consumers aware of KDPL’s new Peak yoghurt, through road shows held across the region. During these roadshows, consumers got the opportunity to taste the product and give feedback about it. One of the male consumers said: “The yoghurt fills my stomach for longer than soft drinks do, which helps me when I am at work.”
At this moment, after just being into production with the brand for a few months, KDPL has been able to increase their production of yoghurt to 150L a day! By the end of the year, they even expect their production to be 500L a day. KDPL and 2SCALE are already planning for next steps in the collaboration: KDPL will need better processing equipment to increase their production, 2SCALE will support KDPL in getting access to finance for this.