Learning from the Stawi Foods Success Story
By Tukeni Obasi
Stawi Foods and Fruits is fast becoming a popular brand and important model on the African agriculture scene. Started in 2010 by 26-year-old Kenyan entrepreneur Eric Muthomi, Stawi Foods and Fruits is already a three-time award winning initiative. It won the Nature Challenge competition geared at promoting the sustainable use of natural resources in 2011, and, in the same year, bagged the winning prize for agro-processing in the Chase Bank Enablis ILO Business Plan competition.
As if that was not enough, this year, the initiative emerged the winner of another business competition for small and medium enterprises, the JITIHADA Business Plan Competition. Its humble beginnings from an idea from Central Kenya to a model for African entrepreneurs speak to the power of ideas to transform communities and usher in change.
Nigeria is blessed with many mineral and food resources. The freshness and juiciness of Nigerian mangoes, guavas, pawpaw, oranges, tangerines, cashews, etc, are relished by foreigners and many Nigerians who live abroad when they visit the country. These fruits and many more are grown and readily available in many parts of the country. However, due to lack of proper storage facilities, efficient transportation and marketing channels, and other infrastructural deficiencies, over 50 percent of these fruits (some hundred thousand tonnes) are lost or destroyed between harvest and sale/consumption. This translates into huge losses for farmers, or at best undercuts their profits.
This problem, however, is not particular to Nigeria. In fact, this was the problem that birthed the opportunity to start Stawi Foods and Fruits in Meru, a banana farming town in Central Kenya. Since large consumer marketplaces were far away, banana farmers found that they were at the mercy of middlemen whose role it was to buy the banana produce at the farmers’ drop-off points and then sell them in large markets. However, by virtue of their position at the bottom of the marketing and distribution chain, farmers found that they had little leeway to negotiate prices with the middlemen. Moreover, on days when farmers could not reach the drop-off points, they incurred huge losses as their fruits rotted in the farm.
In stepping in to address this need, Muthomi confessed that he was trying to kill two birds with one stone by enabling farmers have more direct access to the market and reducing the losses from post-harvest damage. This stone, the result of discussions with farmers and the agricultural ministry, was value adding. Muthomi found that these goals could be achieved by processing raw or green bananas into flour.
The flour could then serve as substitute flour for soups, pasta, baby food, pizza, cakes, and banana bread. As a healthy substitute for sugar, ripe banana flour could be a cost-effective sweetener for beverages and other foods. The issue of healthy nutrition is an especially important one as malnutrition is still particularly rampant in rural areas. Bananas, which are low in sodium and saturated fat, are a rich source of vitamins C and B6, dietary fibre, potassium and manganese, and because the flour can be served a wide range of consumers, from babies (in the form of baby food) to young adults (in the form of bread or pasta) to the elderly (in the form of porridge or soups, for example), it will serve as one way to tackle malnutrition in homes.
Taking a leaf from Stawi Foods and Fruits, value addition – to our mangoes (in the form of mango juice), cashew (processing into juice, wine or jam), cassava (cassava flour), tomatoes (into tomato juice and puree), etc – is a potent force for economic change. In their raw form, there also exist opportunities to provide adequate storage facilities as well as transportation and communication services which will bring rural smallholders farmers closer to food markets. These are important lessons to learn as the Federal Ministry of Agriculture and Rural Development kicks off the value-adding-focused Agricultural Transformation Agenda (ATA).
The story of Stawi Foods and Fruits is an inspirational success story for aspiring and current agricultural entrepreneurs in Nigeria. As with any start-up, things were not all rosy for Muthomi and his team, who now work with 100 farmers in Meru. Acquiring start-up capital, overcoming all the red-tape-induced bottlenecks during the process of obtaining a licence, and working within some of the very strict parameters drawn by food administration agencies are issues that many Nigerian agricultural entrepreneurs can identify with. However, thanks to the proliferation of business and entrepreneurship competitions sponsored by public and private establishments, entrepreneurs who do their homework very well and seek out these opportunities stand a chance to raise a high percentage of their start-up capital in this manner.
Another take-away from the Stawi story is perseverance. As the cassava bread experience bears out, introducing a new product on the market and getting the consumers sensitised to the product can also be a challenge, but I would encourage our entrepreneurs to take this process seriously by seeking out the most effective marketing and awareness channels. This will also require high quality advertising which speaks the language, figuratively speaking, of one’s target audience.
In every drama, as the plot meanders from valleys to hills, the rising action builds up to a climax. In a story of perseverance against all odds, a typical agricultural entrepreneur’s story, this climax is the reaping season where the dividends of one’s labour become visible and the tide turns for the better. For Muthomi, who is planning to scale up his enterprise and even begin exporting the banana flour across East Africa, the new day of harvest is just dawning. But for other African farmers and entrepreneurs ready to take up this value adding challenge and be part of the transformation agenda, it is time to gather the seeds and set out to the field.
This post was originally published on Business Day Nigeria.
