Business Strategies for Agricultural Technology Commercialization

Transcription

1 Arianna De Reus, Khanjan Mehta ABSTRACT creation, expansion, and streamlining of Food Value Chains (FVCs) in developing countries. These technologies target various value chain activities, including agricultural greenhouses, solar food dryers, threshers, grinders, storage, and packaging equipment are just a few technologies that have the potential to improve the livelihoods of mil- - models to assist technology entrepreneurs in commercializing and integrating their agricultural technologies into FVCs. Introduction the worldwide expansion and changing dietary preferences of the middle - commercial and technical innovation in agricultural systems, and reducing food waste and losses one of the foremost impediments to food security. Approximately one third of the world s food produced for human consump- OPEN 2013: NCIIA s 17 th Annual 2013

2 these losses, the amount of grain retained would have the potential to feed Reducing food waste and optimizing land use will require the dissemination and adoption of agricultural technologies that improve the processes com- lowing phases: agricultural production, processing, storage, marketing, dis- and academic programs have emerged to develop innovative technologies successful strategies for commercialization. - the appropriate phases of FVCs on a large-scale, they would make FVCs more the poorest people in the world. Food Value Chain Technologies OPEN 2013: NCIIA s 17 th Annual 2013

3 Agricultural Production There are many technologies that can improve the timing, quality, and yield of agricultural produce, including greenhouses, drip irrigation systems, trea- houses allow farmers to control the temperature, light, and harvest cycle of water harvesting systems, and sand dams also assist in securing water for crop cultivation. This is particularly important in semi-arid and arid climates, where a successful crop depends on economizing water. Processing Processing occurs when raw agricultural materials are altered into a new, ers are all examples of post-harvest processing technologies. Many of these produce. Storage Technologies for storing food can protect it from pests and moisture while safely preserving it for long periods of time. These technologies include her- Marketing Food marketing is the process that connects agricultural produce to the mar- tion ease logistical challenges for farmers, vendors, and consumers and, in farmers and marketing agencies with access to information to help them sell - date price information to farmers and all stakeholders involved in agricultural when and where to sell their produce. Distribution Technologies that aid in this process can reduce food waste and facilitate transport, which increases access to agricultural products for consumers. - sensitive food from the producer to the consumer so that it does not per- OPEN 2013: NCIIA s 17 th Annual 2013

4 Page 4 Consumption - - Challenges to Technology phase of FVCs, many of these technologies have failed to reach the customer segments for which they would have the greatest social impact. Traditional dissemination methods such as donating technologies to developing coun- appropriate for the context and the product fails to create value for the user, the user will not continue to utilize or promote the product within his or her social network, especially when the user feels no sense of ownership over the - - technology yields successful results, the user will want to capitalize on its economic value and continue operating and maintaining the technology. However, commercialization still has its own unique challenges that can impede and disrupt nascent technology ventures. Many ventures do not wish to invest the time and capital into designing, researching, validating, and manufacturing context-appropriate technologies to unlock the economic potential of these Business Models for Technology facturer who sells a product to various customer segments and explore the OPEN 2013: NCIIA s 17 th Annual 2013

5 Page 5 technologies discussed in this paper are too expensive for smallholder farm- - - entire lifecycle of the product or only in an initial phase as the ownership of ing the use of the product, while promoting pride and ownership over the engage its customers, thus reducing revenues from sales. For example, if a manufacturer of solar food dryers is interested in selling its in negotiations with the partner to decide where and how the product would - OPEN 2013: NCIIA s 17 th Annual 2013

6 manufacturer and the vendor must determine how a cost-sharing payment and maintenance while still allowing the manufacturer and vendor to earn the product, or they might not optimize the value of the product. These con- the unique characteristics of the manufacturer s strategic partnership as well customers. The manufacturer can choose to partner with a wide array of actors, including agro-enterprises, community centers, cooperatives, marketing agencies, micro-loan institutions, local governments, the national govern- tions and desired outcomes for its partnership with the manufacturer which, that would allow agricultural technologies to enter and create value for the lar dryer manufacturing enterprise and the implications of each partnership for the manufacturer and consumer. Ultimately, this typology will help inform - tries. A Guide to the Typology - on the most prominent actors in the model. This serves to provide some clar- - - models. As a reference, the manufacturer is the originator of the technology the marketplace. solar food dryer and licenses the technology to a company in a developing of the potential of their solar food dryers. This typology is a guide for the solar food dryer company in its quest to explore and capture larger markets. To further explain what kinds of entities are involved in these models, this - OPEN 2013: NCIIA s 17 th Annual 2013

7 Manufacturer/ Technology Firm Manufacturing products for Creating partnerships and forming business relationships with entities that will sell its products Maximizing demand for its products selling more or diverse (i.e., niche ) products Agricultural Venture Adding value to agricultural products and monetizing them Generating revenues as an agriculture-based enterprise Cooperative Pooling the resources of the coop s members Investing in new resources to improve the lives and livelihoods of the co-op s members Farmers Identifying markets for products Informal Group Joining together to achieve a common purpose (with no legal obligation and minimal start-up costs) Marketing Agency Sourcing products to bring to market Identifying markets for them Minimizing transportation/ storage costs Generating revenues Financing Agency Providing loans Making money from interest Partner Company Partnering with the manufacturer to establish a for- Training/ Vocational Institution Providing training to individuals vocational or agricultural skills OPEN 2013: NCIIA s 17 th Annual 2013

8 Page 8 Community Center Local Government Micro-Loan Institution National Government Providing goods or services to improve the Generating revenues for a community Increasing food security of a community Increasing employment for a community Providing loans Making money from interest Generating revenues for a country Increasing food security for a country Increasing employment for a country NGO (Non- Governmental Organization) cause Minimizing costs and maximizing impact impact ROSCA (Rotating Savings and Credit Cooperative) Serving as a structure to help people save money 1. Agricultural Venture Model The manufacturer sells the product(s) to the agricultural venture. that relate to the FVC. Agricultural ventures typically involve food processing and therefore will This model requires an agricultural venture with enough capital to purchase the product(s) and directly market its processed foods. involves the manufacturer selling the product outright to an agricultural ven- OPEN 2013: NCIIA s 17 th Annual 2013

9 purchases vehicles to transport raw produce from farms to the company s purchasing more solar dryers from the manufacturer. The agricultural venture has its own (easy access to) capital and the manufacturer does not need work. 2. Informal Group Model The manufacturer sells the product(s) to an informal group of farmers. they have invested in the product(s). Farmers can use the product(s) to complete their FVC activities and earn Four farmers who have lived in the same community for years decide to collectively purchase a single solar dryer. They equally share the initial cost of the solar dryer and take turns using it throughout the harvest seasons. Although these farmers were willing to invest in a solar dryer together, they nation and maintenance plan for the solar dryer leads to social tension within farmers might consider purchasing more solar dryers to facilitate sharing and prevent strains on their relationships. OPEN 2013: NCIIA s 17 th Annual 2013

10 3. Cooperative Model The manufacturer sells the product(s) to the cooperative. - The cooperative pays for routine maintenance on the product(s) out of negligence. with their use of the product(s). - dry tomatoes for personal consumption or sale at the local market. Farmers that are part of the cooperative can rent and use these solar dyers at a discounted rate (or for free), while other farmers who are not part of the cooperative may use the solar dryers at a higher price. These rental fees supplement current solar dryers, invest in future solar dryers, or purchase new technologies that complement the solar dryers. 4. Rental Agency Model OPEN 2013: NCIIA s 17 th Annual 2013