{"id":1274,"date":"2017-04-24T09:47:38","date_gmt":"2017-04-24T09:47:38","guid":{"rendered":"http:\/\/www.emkambo.co.zw\/?p=1274"},"modified":"2017-04-24T09:47:38","modified_gmt":"2017-04-24T09:47:38","slug":"key-elements-of-market-informed-agribusiness-models","status":"publish","type":"post","link":"http:\/\/www.emkambo.co.zw\/?p=1274","title":{"rendered":"Key elements of market – informed agribusiness Models"},"content":{"rendered":"

Like all businesses, agribusinesses should be built around a product\/service and a niche market. Ideally, more products and services spawn more business models with some models eventually becoming separate business units.\u00a0 When that happens, it becomes easy to assess the viability of each business model. Contrary to some beliefs, in a business model, money is just like salt. Without meat or vegetables, salt is useless.\u00a0 The salt owner should be interested in those with meat, potatoes, tomatoes and other products. On the other hand, while some commodities need salt, some consumers don\u2019t need much salt.<\/p>\n

\"key-elements-of-market-informed-agribusiness-models\"<\/a><\/p>\n

Confusing a business plan with a business model<\/strong><\/p>\n

Most agribusinesses lack models.\u00a0 They confuse a business plan with a business model yet a plan assists in executing a model.\u00a0 A model is an attempt to turn your innovation into profit or economic value.\u00a0 The following pillars help to characterize a business model without over-simplifying the complexity in agricultural value chains<\/p>\n

    \n
  1. The owner<\/strong> -who will provide the product or service.<\/li>\n

    <\/p>\n

  2. Value proposition<\/strong> \u2013 What need or solution do you want to address?\u00a0 Have you addressed a need?\u00a0 Absence of a value proposition is the main reason why we end up with copycats who just watch what another person is doing and try to imitate rather than focusing on the customer.\u00a0 A need is a value proposition.\u00a0 What loans are needed from the customer\u2019s perspective?\u00a0 To what extent is a reasonable interest rate a solution to farmers?\u00a0 What if loan amount is the real need?\u00a0 What if the main issue is unfavorable conditions that insist on collateral not in line with the agribusiness?<\/li>\n

    <\/p>\n

  3. Market segmentation –<\/strong> Who are you targeting?\u00a0 Are you targeting farmers, traders, transporters or individual consumers?\u00a0 A clear target will enable you to model in line with business behavior.\u00a0 Most models, especially financial ones, are locked in systems.\u00a0 It is important to create your own market niche that can inform what products to provide.<\/li>\n

    <\/p>\n

  4. Distribution channel<\/strong> \u2013 What is your distribution channel?\u00a0 How are you going to reach your customers cost-effectively?\u00a0 Most banks ended up setting up brick and mortar structure to establish presence. However, the entire value chain may be better supported by ICT-inspired channels.\u00a0 Where Point of Sale (POS) machines are missing at other value chain nodes, clients get stuck.\u00a0 For instance, loan disbursement will not be useful if traders cannot transact from rural agro-dealers where they stay.\u00a0 Neither can loan repayment be smooth.\u00a0 When clients get money, they want to use it somewhere.\u00a0 It is important to understand destinations where money will end up being used.\u00a0 That will enable building of other networks like between farmers and agro-dealers who also know what farmers need.\u00a0 Concentrating on the immediate client is a big mistake, particularly in the network economy.<\/li>\n

    <\/p>\n

  5. Identify niche markets<\/strong> – Invest in building relationships or ride on partners who have already built networks. That is how you can build more models and networks.<\/li>\n

    <\/p>\n

  6. Best use of resources<\/strong> \u2013 resource configuration.\u00a0 Should you go and rent a building or work through agents?<\/li>\n

    <\/p>\n

  7. Identify core competencies \u2013<\/strong> What are the skills, knowledge, abilities, expertise and attitude available for supporting all other pillars?<\/li>\n

    <\/p>\n

  8. Networks <\/strong>\u2013 You cannot work in isolation.\u00a0 Which partners are you going to collaborate with?\u00a0 Trying to dominate the whole value chain speaks to unjustified enrichment at the expense of other actors.<\/li>\n

    \n<\/ol>\n

    Some of the fundamental considerations in agribusiness models<\/strong><\/p>\n

    It should be about capturing everyone.\u00a0 Start with early adopters who can assist you in refining as you go.\u00a0 Do not dream of creating wealth if you are not creating wealth for others. Starting with others builds a sustainable base for your wealth.\u00a0 From early adopters you are able to refine your financial strategy. Most business models have too many messages which end up confusing potential clients. Concentrate on a core message and few benefits.<\/p>\n

    If tobacco farmers who come to the market once a year get preference for cash from banks, what about traders who are in the market throughout the year and drive food markets?\u00a0 That ignorance is counter-productive because it lures many farmers into tobacco, leaving other potentially lucrative commodities.\u00a0 Why don\u2019t banks enable traders to also get cash when they need it?\u00a0 That is why traders end up locking their money in the market with their relationships with farmers.\u00a0 They know that once they bank it, the money will be given to external value chain actors who are not interested in agricultural markets.<\/p>\n

     <\/p>\n

    Charles@knowledgetransafrica.com<\/a>\u00a0 \/ charles@emkambo.co.zw<\/a> \/ info@knowledgetransafrica.com<\/a><\/p>\n

    Website: www.emkambo.co.zw<\/a> \/ www.knowledgetransafrica.com<\/a><\/p>\n

    eMkambo Call Centre: 0771 859000-5\/ 0716 331140-5 \/ 0739 866 343-6<\/p>\n","protected":false},"excerpt":{"rendered":"

    Like all businesses, agribusinesses should be built around a product\/service and a niche market. Ideally, more products and services spawn more business models with some models eventually becoming separate business units.\u00a0 When that happens, it becomes easy to assess the viability of each business model. Contrary to some beliefs, in a business model, money is Read more about Key elements of market – informed agribusiness Models<\/span>[…]<\/a><\/p>\n","protected":false},"author":100,"featured_media":1275,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[25,19,3,87,31],"tags":[],"_links":{"self":[{"href":"http:\/\/www.emkambo.co.zw\/index.php?rest_route=\/wp\/v2\/posts\/1274"}],"collection":[{"href":"http:\/\/www.emkambo.co.zw\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.emkambo.co.zw\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.emkambo.co.zw\/index.php?rest_route=\/wp\/v2\/users\/100"}],"replies":[{"embeddable":true,"href":"http:\/\/www.emkambo.co.zw\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1274"}],"version-history":[{"count":3,"href":"http:\/\/www.emkambo.co.zw\/index.php?rest_route=\/wp\/v2\/posts\/1274\/revisions"}],"predecessor-version":[{"id":1278,"href":"http:\/\/www.emkambo.co.zw\/index.php?rest_route=\/wp\/v2\/posts\/1274\/revisions\/1278"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/www.emkambo.co.zw\/index.php?rest_route=\/wp\/v2\/media\/1275"}],"wp:attachment":[{"href":"http:\/\/www.emkambo.co.zw\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1274"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.emkambo.co.zw\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1274"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.emkambo.co.zw\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1274"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}