Project Proposal 30 July 2009 Women Economic Empowerment through Small Scale Food Processing (Pickle Processing and Marketing in Karachi) July 2009 Umm e Zia
Table of Contents Executive Summary... 5 1. INTRODUCTION... 7 1.1. Dynamics of Initiating a Project in Food Processing... 7 1.2. Similar Projects Implemented by CARE... 8 2. BACKGROUND AND RATIONALE... 8 3. DRIVERS OF PICKLE PROCESSING INDUSTRY... 9 4. IMMEDIATE OPPORTUNITIES IN PICKLE PROCESSING INDUSTRY... 9 4.1. Role of Women in Local Pickle Industry... 11 5. LONG TERM EXPECTATION FROM THE PROJECT... 12 6. PROFILE OF TARGET AREA... 13 7. PROJECT DESIGN... 15 7.1. Goal... 15 7.2. Objectives... 15 8. APPROACH... 16 8.1. Partnership... 16 8.2. The Target Group... 16 9. IMPLEMENTATION... 18 10. INTERVENTION... 20 11. SUSTAINABILITY... 32 11.1. Sustainability Plan... 32 12. ALTERNATIVE APPROACH... 34 12.1. Alternative I... 34 12.2. Alternative II... 34 I
13. MONITORING AND EVALUATION (M&E)... 35 13.1. Monitoring System... 35 14. KNOWLEDGE MANAGEMENT... 36 15. ANTICIPATED RESULTS... 36 16. CHALLENGES... 37 16.1. Commitment to Quality... 37 16.2. Establishing Reputation... 37 16.3. Business Growth... 37 16.4. Branding... 37 17. TECHNICAL ASSISTANCE (TA)... 38 18. BUDGET... 38 BIBLIOGRAPHY... 40 ANNEXES... 42 II
Executive Summary CARE Pakistan has chosen Economic Development as strategic focus of its long-term development programs. The Country Office (CO) is taking a market development approach, with a focus on agriculture sector. In Pakistan, 79.4% 1 women in agrarian communities are involved in agriculture, but have little ownership of assets or control over their incomes. Using a value chain approach, the CO seeks to identify and to promote strategic value chains that offer opportunities to enhance poor women s contributions to and benefits from higher value participation. Considering its high reliance on women workforce, linkage with agriculture, and potential for high value addition, the CO has identified the small scale food processing industry as a value chain. Initially, the CO intends to undertake a pilot project in small scale pickle processing and marketing. Two approaches are presented for starting a pilot. In the first approach, the project will develop a cohesive women enterprise group of 135 women entrepreneurs in Karachi who are engaged in collective procurement and marketing. Alternatively, the project will target up to 400 women under the same approach, while working in Karachi, Hyderabad, and Shikarpur. In the second approach, the project will form up to 25 clusters of 1000 women entrepreneurs linked to various marketing channels of their choice. The Pakistani food processing industry is characterized by numerous small processing units, mostly belonging to the informal sector. Almost one-third of the informal food processing industry is located in Karachi, with the remainder spread among the major urban centers. About a quarter of the industry is involved in the processing of fruits and vegetables 2. The FPI faces numerous challenges that hinder this development. These include fragmented units, supply of raw material, manual processing, product safety and hygiene, and access to BDS like credit or insurance. To develop a scalable pilot project in food processing, the pickle industry was chosen due to its unique characteristics including high engagement of women, market demand, easy market access, high returns, and locally available raw materials. Moreover, a project supporting the development of pickle value chain can effectively address urban poverty by increasing women s incomes. Annual pickle consumption in Pakistan is estimated at 336,000 metric tons 3. The domestic packaged pickles industry has been reportedly growing at an estimated rate of 20% 4. In 2005-1 FAO, Asia s Women in Agriculture, Environment, and Rural Production PAKISTAN (http://www.fao.org/sd/wpdirect/wpre0111.htm) 2 Ibid 3 Consultant Estimates Page 5 of 83
2006, around 643,018 Kilogram pickle was exported. Main export markets include USA, UK and Middle East Countries. Almost 90% of the home based or small enterprises in pickle making engage women in preparation and production processes. However, marketing of the final product is a male dominated activity. These women work for long hours under stressful working conditions and paid low wages ranging from Rs. 80 to 100 per day. In case of home based production, most women have to solely rely on men in the household for marketing. In other words, women undertake almost all the work required to produce pickles, but are only rewarded marginally. By engaging women in the pickle processing value chain, where women are not only responsible for production, but also carry out marketing, will give them a better control over their earnings. The proposed location for this pilot project is Karachi. Karachi is the largest consumer market in Pakistan, hosting a population of 15 to 20 million people, with an annual growth rate of 5% 5. The overall long term expectation from this pilot project is: A brand established by a women owned organization 6 that processes and markets a variety of food products at the national and international levels. This organization will start from 135 women owners in the pilot phase of two years, and grow to approximately 1,000 women owners in the five years after completion of the pilot. During this period, the organization will develop vertical and horizontal linkages with up to 400 women in the food processing supply chain, include women farmers, agro-processors 7, suppliers, workers, and market agents. To initiate their enterprise, the women will be assisted in accessing microfinance. Training will be provided in group formation, product preparation, quality and hygiene, business management, and marketing. Similarly, linkages will be developed with input suppliers and market agents in wholesale and retail markets. For inputs, special emphasis will be put on establishing linkages with women, where possible. Similarly, the WEG members will give employment to up to 20 women, mostly as seasonal laborers. CARE will use this pilot project as a learning experience, where in the next phase, up to 5000 beneficiaries be reached, to set up food processing enterprises of different products. 4 SMEDA Pickle Feasibility 5 City District Government Karachi - http://125.209.91.254/cdgk/home/aboutkarachi/geographydemography/tabid/270/default.aspx 6 Due to the tumultuous history of cooperatives in Pakistan, the word cooperative has negative connotations. Instead, the word organization has been used through this document. At the time of the implementation, this can suitably be changed to company, processor group, etc., upon understanding the different organizational available in Pakistan and their relative advantages. 7 These linkages can be developed with individual women or women groups. Food processing industry requires linkages with raw products like vegetables and grains, and agro-processors like mustard oil extractors or grain millers. Such agro-processing also offers opportunities for women investment and participation at the small scale. Page 6 of 83