As in all 2SCALE partnerships, the 2SCALE-MDU partnership leverages the concept of Agribusiness clusters (ABCs) to accelerate the development of the dairy value chain in Kenya. An ABC is an informal multi-actor network operating at the grassroots level. It involves all actors that are in some way connected to a specific commodity, and who are seeking solutions to their input, production, processing and marketing problems and opportunities for improving their competitiveness and collective performance. ABCs give grassroots actors a voice and allow them to link with other stakeholders in proximity, such as agro-input retailers, local branches of financial institutions, local traders, extension officers, and enablers such as local governments.
In the MDU partnership, the Dairy Farmers Cooperative Societies (DFCS) anchor the ABCs. Each DFCS is a cluster in the MDU partnership. Supporting farmers to increase quality milk production is one of the critical interventions that MDU has in the partnership with 2SCALE. Therefore, ABC monitoring, evaluation, and strengthening activities are essential for improving these clusters' performance.
A recent evaluation of MDU farmers' cooperatives by the partnership’s Inclusive Agribusiness Advisor and SPARD Africa, the Business Support Service (BSS) provider, confirmed that there are high, mid-level, and low-performing clusters. This was determined based on factors such as the cooperatives’ daily milk volumes, governance, and farmer loyalty. With the aim of strengthening the mid- and low-performing cooperatives, 2SCALE organized exposure visits hosted by the high-performing cooperatives.
The visits were conducted in four sub-counties, from the 14th to the 18th of November 2022. The executive management committee from five high-performing cooperatives in North Imenti, South Imenti, Central Imenti, and Buuri sub-counties each hosted leaders from two to five learning cooperatives in their sub-county. A total of 16 learning cooperatives participated in the exchange visits. The Sub-County Cooperative Officers (SCCO) from the county government, who were brought on board to provide further knowledge and expertise on governance and leadership, guided the visits.
James Kaimenyi, the SCCO, South Imenti sub-county, highlighted the essence of the session. He elaborated,
We are here to learn from each other and promote growth in our cooperatives. These interactions will create an opportunity for us to find out more about how these ‘giants’ operate.
Identifying and addressing existing gaps
The sessions kicked off with the cooperatives sharing their background, that is, when it was formed, the number of registered and active farmers, daily milk volumes, and the challenges they experience in their operations.
The hosting cooperatives closed this first part of the session by addressing the various challenges highlighted by the learning group. They provided practical information based on their experiences and lessons learned to inspire and inform the other cooperatives.
Many of the challenges presented by the learning cooperatives cut across the board. These included high transportation costs, high competition from other buyers and brokers in the market, limited access to quality cow feed among the farmers, especially during the dry season, limited access to finance, lack of farmer commitment to dairy farming and the cooperative, as well as weak leadership and governance structures and poor management of the cooperative’s assets.
The floor was then opened for a question-and-answer session, presenting an opportunity for the learning cooperatives to ask follow-up questions and seek further clarification from the hosting cooperative and the SCCO. The Q&A segment was open and interactive, with participants even engaging in their local language for ease of communication.
Abel Murungi, speaking on behalf of his cooperative, Kiungone DFCS in South Imenti, found the session very eye-opening. He says,
Today we’ve discovered that we have not been taking business seriously. With our average milk volumes at 1420 litres per day, we thought we were the best of the best. It has been made clear here that there is significant room for improvement. If Nkuene DFCS can collect an average of up to 18,000 litres a day, then we can do much more as a cooperative.
The hosting cooperatives did not hold back during the sessions. They provided honest and impactful insights on their journey thus far, sharing tips and tricks on how to manage the cooperative. Paul Kirimi, the manager of Katheri DFCS in North Imenti, a hosting society, shared the ups and downs of their journey as a cooperative. Since its inception, in 1963, Katheri has collapsed thrice due to mismanagement. He elaborated on some aspects that contributed to their recovery and growth since 2008,
Since the fall of Katheri in 2007, we focused on addressing our main challenge- mismanagement. The biggest game-changer for us was developing a business plan and sticking to it. Having a strategy is important because, with a plan, there is no problem that is too big. We also leveraged linkages to other players in the value chain, including banks and the government, for support.
Regarding leadership, the hosts emphasized on creating a thriving environment for all staff and the cooperative’s members. Ann Kimaru, SCCO Buuri Sub-County, at Buuri DFCS, a hosting cooperative advised as follows,
Strong leadership is critical to the success of the cooperative. The executive members should lead by example. You need to set high standards through the milk volumes you produce and be proactive in training and adopting new technology. It is also important to motivate your staff members and reinforce farmers’ loyalty to the cooperative by employing incentives.
Additionally, the hosting cooperatives also seized the chance to share some of the challenges they are facing and seek direction on how to manage them.
Reflecting on the learnings and crafting a way forward
The discussions proved fruitful as the learning cooperatives were able to establish possible solutions for their challenges. Key learnings from the hosting cooperatives included employing different models to reduce transportation costs, working closely with MDU for support in capacity building, extension services and financial record keeping and tracking, adhering to the rules of a cooperative society, strengthening leadership structures, and building a better relationship with the cooperative’s members (farmers).