Sourcing strategy to supply fresh vegetables for the domestic and export markets

FarmWorks Farming Services Kenya Limited was founded in 2020 as an agribusiness company and has operations that include primary production, aggregation, and distribution of fresh vegetables in the domestic and export markets.

Over the past three years, FarmWorks has grown to be a significant player in the domestic distribution of fresh produce in a market that is primarily disintegrated, with informal open market traders being key last mile delivery agents of produce to consumers. In 2023, Farmworks had over 30 branches located in strategic areas across Nairobi, Kenya and its environs. 

In 2022, IDH partnered with FarmWorks to establish a sourcing strategy for fresh produce supply for the domestic and export markets while scaling the number of farmers from 1000 to 5,000 over three years. The project proposed interventions in the following areas:

1. Upskilling of FarmWorks extension staff and farm managers of out-grower farmers through an apprenticeship program
2. Improve the production skills of farmers through a consistent training program
3. Improve access to inputs by leveraging service coalitions
4. Improve water use efficiency of small-scale farmers by transitioning farmers to efficient irrigation techniques and
5. Digitize data collection to improve company operations, traceability and food safety

Over the past three years, the FarmWorks has supported 3,580 farmers by providing training, access to input and access to finance services. Additionally, the company has worked with an even bigger number of farmers by serving as an off-taker for their produce, ensuring access to reliable markets. This endline analysis sought to establish the performance of the project. Key outcomes were as follows:

1. 810 farmers received training on good agricultural practices
2. 653 farmers accessed inputs on credit. FarmWorks has been unable to scale this offering on its balance sheet. It is currently in discussions with banks to explore the possibility of transitioning this service to their portfolio
3. Drip irrigation techniques were piloted but did not scale due to inconsistent water access and capacity constraints within FarmWorks
4. FarmWorks transformed into a data-driven organisation. Significant investments in technology and human resource capabilities marked this, improving the company's operations and enhancing traceability and food safety
5. Overall volumes traded by the company increased by 176%, driven by the scaling of business operations as a result of growing demand for horticultural produce