Transcript A Qualitative Analysis of Success, Failure and Demand

Qualitative Analysis of Cooperatives
Performance Factors in Kiambu
District, Kenya
BY
James Nyoro and Isaac Komo
Outline of Presentation
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Introduction
Problem statement and objectives
Methods
Indicators of success
Factors attributed to performance of
cooperatives
• Recommendations
Introduction
• Agricultural cooperatives enhance:
– Economies of scale (inputs and output)
– Advocacy and bargaining power
– Financial access
• Role:
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production
collection
processing
marketing
• In general, promote economic interests and
general welfare of members
Problem Statement and
Objectives
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Increased competition
Varied performance by cooperatives
Why this scenario?
Objectives:
– Identify success and failure factors of
cooperatives
Methods
• Interviews with key informants- CBK
officers, MoCDM and KUSCCO
– Identified measures of success
– Selected study area
– Identified cooperatives
• Interviews with Management committees
– Data on performance factors
• Qualitative approach adopted
Measures of success
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Payout rates
Promptness paying members
Credit accessibility
Conflicts
Selected cooperatives
Sub-sector
Successful
Unsuccessful
Dairy
Githunguri
Nderi
Limuru
Kinale
Komothai
Mikari
Ndumberi
Gititu
Coffee
KShs.14.60
Payout rate (KShs./litre)
Payout levels in relation to
industry rate, year 2003 (Dairy)
25
20
15
10
5
0
Githunguri
Limuru
Kinale
cooperative
Nderi
Kiambu
30.00
25.00
20.00
15.00
10.00
5.00
0.00
Kinale
Limuru
Production year
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
Githunguri
1993
Payout to farmers (KShs.)
Trends in Nominal Annual Average Payout Rates to
Farmers by Dairy Cooperatives, 1993-2003
Trends in Real Annual Average Payout Rates to
Farmers by Dairy Cooperatives, 1993-2003
35
Payout rate (KShs./litre)
30
25
Kinale
20
Limuru
15
Nderi
Githunguri
10
5
0
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Production year
Promptness in paying farmers
Sub-sector
Performance
Cooperative
Promptness
(months)
Dairy
Successful
Githunguri
1
Limuru
1
Nderi
4
Kinale
3
Komothai
3
Ndumberi
6
Mikari
9
Gititu
9
Unsuccessful
Coffee
Successful
Unsuccessful
Success factors
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Vertical integration
High output
Large number of members
High quality produce
Proper record keeping and level of technology
SACCOS
Stores for farm inputs
skills and education of mgt committee and staff
Timely and appropriate information
Diversification
Benefits from Vertical Integration
•Savings on transport and processing cost
•Gains from value addition
•Gains from by-products
•Enhanced promptness in paying farmers
18000
16000
14000
12000
Kinale
10000
limuru
8000
6000
Nderi
4000
Githunguri
2000
Year
03
20
02
20
01
20
00
20
99
19
98
19
97
19
96
19
95
19
94
19
93
0
19
Litres of marketed milk (000s)
Quantity of Milk Marketed Through
Cooperatives
9000
7000
6000
5000
4000
3000
2000
1000
0
8000
No. of active members
No. of act ive members
Number of active members
7000
6000
5000
4000
3000
2000
1000
Githunguri
Limuru
Nderi
Dairy cooperative society
Kinale
0
Komothai
Ndumberi
Mikari
Coffee cooperative
Gititu
Factors influencing quality
Coffee:
• Farm Management practices
• Factory level factors
• Milling level factors
Dairy:
• Adulteration
• Diseases
Quality control strategies- Dairy
Cooperative
Quality control measures
Githunguri
dairy
-Lactometer and testing guns at collection centres
-Special committee do impromptu checks
-Testing instruments at plant
Limuru dairy
-Impromptu checks at collection centres
-Lactometers
Nderi dairy
Organoleptic tests
Kinale dairy
-Organoleptic tests
- Occasional inspection
Quality control strategies- Coffee
Cooperative
Quality measures
Komothai
-Elected field committee to supervise weeding, pruning and
intercropping
Ndumberi coffee -No intercropping with heavy crops eg maize and nappier grass
-Use well aerated wire mesh bins rather than concrete bins
-Strict on timely delivery and pulping
Mikari coffee
-Recently:
- instituted inspection committee to oversee farm input credit
fugibility
-Train on benefits of good farm management
-Use non- smokers in drying
-Ladies using perfumes not engaged
-engaged an experienced and quality sensitive manager
Gititu coffee
None
Record keeping and access to credit
Sub-sector
Performanc Cooperative Computerized
e
Dairy
Successful
coops
Unsuccessful
Coffee
Successful
Unsuccessful
SACCOs
Stores
Githunguri
Y
Y
Y
Limuru
Y
N
Y
Nderi
N
N
N
Kinale
N
N
Y
Komothai
N
Y
Y
Ndumberi
N
Y
Y
Mikari
N
N
N
Gititu
N
N
N
Qualification of management committee and staff
Sub-sector
Performance
Cooperative
Most qualified
committee member
Most qualified
staff member
Dairy
Successful
Githunguri
University
Post-graduate
Limuru
University
University
Nderi
Secondary
Secondary
Kinale
Secondary
Secondary
Komothai
Diploma
University
Ndumberi
College
College
Mikari
University
Secondary
Gititu
Primary
College
Unsuccessful
Coffee
Successful
Unsuccessful
Diversification in cooperatives
Subsector
Performance
Cooperative
Diversification activity
Dairy
Successful
Githunguri
-AI
-Shares with union
-Foodstuff
-Fuelling station
-Rental houses
Limuru
-AI
-Foodstuff
Nderi
-Idle plots
Kinale
-Foodstuff
Komothai
-None
Ndumberi
-Public address system
-Letting out idle land
Mikari
-None
Gititu
-Idle plots
Unsuccessful
Coffee
Successful
Unsuccessful
-Rental houses
-Ploughing
Additional factors attributed to
failure
i.
ii.
iii.
iv.
v.
Credit burden & debtors
Competition: hawkers and processors
Wrangles and hostilities
External forces
Mismanagement
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Investment on non-income generating
activities
Dishonesty & embezzlement of funds
Debt burden
45000
Outstanding loan
per active member
40000
35000
30000
25000
20000
15000
10000
5000
0
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Summary
Dos
Don’ts
Add value
Avoid heavy indebtedness
Increase Membership
and output
Capacity building
Mismanage
Provide credit
Invest unprofitably
Recommendations
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Measures to improve quality
Improve record keeping (eg computerize)
Measures to check mismanagement
Diversification to profitable enterprises
Value addition
Enhance market access
Acknowledgements
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SAGA: Cornell University, USA
MoCDM
CBK
Cooperatives’ management committees
Tegemeo staff