Service delivery as a business: Driving continuous improvement and impact in smallholder markets

Due to the growing world population, we have to double global food production by 2050. Today, 70% of the global food supply is produced by smallholders, who are also an important source of commodities such as coffee, cocoa, cotton and cashews. Some 500 million smallholders worldwide rely on agriculture as their main source of income. Despite the high demand for food, most of them are unable to make a living from farming.  An increasing number of public-and private actors aim to fix this broken system by investing in support delivery services for farmers, such as training programs, farm inputs and finance, but these efforts are fragmented. As an answer to this, NewForesight supports our long-term partner, the Sustainable Trade Initiative (known by the Dutch acronym IDH), with the design of a systematic, data-driven approach to analyze and improve the cost-efficiency and impact of the service delivery models (SDM) of dozens of organizations in various sectors, commodities and countries. We believe this initiative by IDH is a game-changer in thinking about sustainability from a business perspective, by creating a common language in which to speak about service delivery models, allowing comparison and identification of best practices, and is part of an integrated IDH service offering from analysis to technical assistance to convening to blended finance solutions.

Analyzing and improving the return of investment and farm-level impact of service delivery

In agricultural supply chains, companies, civil society organizations, financial institutions governments all can be involved in providing services to farmers such as training programs, agricultural inputs and loans. However, these forms of farmer engagement are often limited to a single company or organization, or to a single commodity, and are not developed for scale. The service packages may also be incomplete or short-term; as a result, farm-level improvements may only be temporary. NewForesight supported IDH in the development of a standardized methodology to analyze the model of services provided, including key actors, flows of goods, services and financing. With this methodology, value chain partners across the globe can better understand the effects and return on investment of their interventions.

Reaching more than 1 million farmers in 16 countries and 12 commodity sectors

“We greatly value our relationship with the NewForesight team and their ability to deliver high-quality work with critical analytical and market insights. The NewForesight team is passionate and dedicated to improving the lives and livelihoods of smallholder farmers while simultaneously helping private sector partners achieve sustainable value chain engagement. IDH is proud to recommend NewForesight as a partner and looks forward to continuing our partnership in the future.”

Iris van der Velden│ Director Learning & Innovation IDH.

Together with IDH, NewForesight has analyzed 30 individual service delivery models in several staple and cash crops such as coffee, cocoa, spices, maize, cotton and cassava. For each analysis, reports are produced for the service provider, along with a tool to monitor the performance over time. This performance data can then be benchmarked against the database of case studies covering 80 key performance indicators (KPIs), such as farmer profitability, costs and financial sustainability. IDH’s Smallholder Insights Report, released in December 2017, summarizes the exciting findings from a comparative analysis of the 30 service delivery models that have been analyzed so far. Throughout the course of 2019, IDH will continue to increase the number of SDM case studies, expand the database and implement a continuous cycle of learning, sharing, improving and innovating on smallholder engagement

Overview of SDM cases analyzed, from IDH’s Smallholder Insights Report

Two reasons why NewForesight is the right partner in this data-driven approach in smallholder innovation

  • NewForesight is the leading instrumental partner in analyzing SDMs due to our outstanding expertise on building systematic and standardized methodologies and tools for quality insights.
  • The NewForesight team not only has excellent skills in building measuring tools, we also have in-depth knowledge of sustainability challenges and agricultural economics.  In this way we can provide comprehensive solutions.