Implications for scaling
Trust is critical
Establishment of trust between the company and producers requires patience, but at the same time creates a solid foundation for a long-term business relationship. As an external facilitator it was quite challenging at the beginning to see a large number of agribusinesses willing to deal with apples from Jumla but reluctant to engage because of the transportation problem. Once the company agreed to enter into a contractual agreement, it also took a considerable amount of time to establish mutual trust and confidence among the contracted parties. The key learning point here was that ‘the role of external facilitator goes beyond the mere establishment of formal contracts’.
Focus on ‘crowding in’ of buyers
Scaling has been initiated as both agribusinesses involved have now developed business plans to substantially increase sourcing from Jumla. A number of wholesalers have also shown an interest in developing business relationships with Jumla. As a facilitator, this crowding in needs to be promoted as this will discourage a monopolistic market and promote competitive practices. This will also enhance the bargaining power of producers and ensure that they are rightfully paid.
Involvement of the agribusiness in service provision is important for quality assurance and better business relations. It also contributes to the sustainability of the service delivery.
Key factors for scaling
Finally, the apple case in Jumla shows that for scaling inclusive business a number of inter-related key factors need to be in place: (i) market demand, (ii) production potential to meet this demand, (iii) a committed private sector and a business model which is mutually beneficial for agribusiness and farmers and (iv) infrastructure that facilitates the movement of products.