Sustainable Livelihood for Small-scale Aquaculture Farmers through Expansion of Kallyani Micro-franchise model 

Client

Bangladesh Aquaculture and

Nutrition Activities (BANA)

Implemented By

iSocial – Infolady Social Enterprise Limited.

Project Summary

In this project the outcomes of a 15-month-long initiative implemented by iSocial for The Feed the Future Bangladesh Aquaculture Activity (BAA) to research and develop a micro-franchisee (MF) model for aquaculture inputs and value-added services, built upon its national network of female micro-merchants.

The twofold objectives of this initiative were to support small-scale fish farmers who face many obstacles as well as create an avenue for women and youth to participate in the market. Small scale farmers often don’t have adequate access to inputs, since small orders do not justify the cost of delivery, small farmers do not want or are not able to buy the large packages of the product, and farmers do not know the product available in the area among other reasons. Women and youth are also heavily underrepresented in the aquaculture market.

In this business model, female micro-entrepreneurs operated micro-franchises to handle all customer-facing activities in selling a product or service associated with the aquaculture value chain to support local smallholder fish farmers. iSocial operated as the distributor in this arrangement working with the aquaculture input manufacturers and suppliers to make inputs available to its micro franchisees and therefore to small scale farmers. The initiative ran between Oct 2020 to December 2021.

370 micro franchisees onboarded and trained in three working Upazilas of Jessore: Jessore Sadar, Jhikargacha, and Sharsha. All MFs have SSC level educations and are willing to invest in an aquaculture business. They also own a smartphone/tablet to conduct their business. The MFs sourced their stock from 7 local partners that iSocial lined up – hatcheries for fingerling and input traders for fish feed, oil cake fertilizers, lime etc. The MFs each acquired and managed a cohort of 15-20 customer farmers to who they provided inputs as well as provided supplementary services such a cultivation advice with the support of a technical advisor. During this initiative, the 370 MFs achieved cumulative sales of BDT 26,00,000.

Business linkage workshops were also organized at the district level between government stakeholders, aquaculture input traders, farmers and Micro franchisees to discuss about the business linkage opportunities between the different actors in aquaculture value chain.

The key challenges experienced during the implementation were high capital requirements for entering the aqua-inputs market due to prevalent credit practice, limited investment capability of MFs and relatively low digital literacy amongst MFs.

In future iterations, of this model, better outcomes may be achieved if investment is made in developing a more robust digital credit channel to respond to the business needs of MFs, more dedicated focus on digital literacy development, and emphasis on participatory digital application design to increase user acceptance amongst MFs.

Project Background

The Feed the Future Bangladesh Aquaculture Activity (BAA) is a five-year project of USAID intend to improve nutrition through growth in the aquaculture sector growth.  BAA works in 21 districts of southwestern Bangladesh and two districts in the southeast.

Small scale fish farmers face many obstacles.  Many of these could be solved by improved access to inputs– feed, packaging, chemicals, machines, and other items.  There are several reasons why supplies do not reach rural areas– small orders do not justify the cost of delivery, small farmers do not want or are not able to buy the large packages of the product, farmers do not know the product available in the area, and more.

There are many market opportunities for the companies who can overcome these obstacles and reach these customers.

“Micro-franchising” is a model with good potential, a model which has had success in Bangladesh.  In this business model, a micro-entrepreneur becomes operates a micro-franchise to handle all customer-facing activities in selling a product or service while a master franchise operator handles supply and logistical issues in a specified locality.  The master franchisee works with the supplier–   a large fish feed company, for example– to training, support, and re-supply.  The micro-franchisee sells the products in his/her local area.

This can also be a very a good way to bring women and young people into business.

Project Objectives

The primary goal of the project is to create a sustainable micro franchise-based supply chain model to serve the needs to small scale aquaculture farmers. In this process the project will build a network of community-based change agents for meeting critical needs of the community in multiple SDG impact areas including decent job creation, nutrition and partnership. Around 370 micro Franchises will be created within a year. The small farmers working in aquaculture will get access to inputs and knowledge from authentic sources. This will allow them to increase income, ensure nutrition balance within family and community and contribute to food security. The project will contribute to developing a replicable business model through this experimental project for spreading in other F-t-F areas. It will also help to understand what kind of viability gap funding is required for commercially sustainable models.  

Geographical coverage

Key Matrices Achieved

The following table details the key metrics achieved during the project:

#Sl no. Activity Description of Activity Target Achievement
1 Need assessment To understand the current value chain practice and the community demand a need assessment was conducted at three working Upazila at the very beginning of the projects. 1 1
2 Stakeholder Engagement 3 stakeholder engagement were conducted at the three working Upazila with Govt. Stakeholders and 3 3
3 Micro Franchisee onboarding 378 MFs were onboarded at Jessore sadaf, Jhikargacha and Sharsha. 370 378
4 Training of Micro Franchisee After selection 378 MF received training on basic entrepreneurships, financial literacy, digital literacy, specialization training on Aquaculture. 370 378
5 Shop Branding 370 MFs sales point were branded with signboard and arrow sign. 370 370
6 Sales BDT 2,609,379 sales were done by Micro franchisees. They were sold General basket and Aquaculture basket like FMCG products, SRH products, MFS, Aquaculture products ect. 4,000,000 2,609,379
7 Value chain partnerships 7 local value chain partnerships were don at the district level for aqua culture inputs. 10 7
8 Farmers meeting MFs were conducted Farmers meetings at their community with the Aqua farmers. In that meeting they discussed about the Fish cultivation and aqua inputs. 740 338
9 Business linkage workshops 3 Business linkage workshops were conducted at Sadar, Jhikargacha and Sharsha. 3 3

Key Innovation of the project

iSocial has been working to build a digital ecosystem, where suppliers can offer products and services and buyers can access relevant products and services at the door-steps. At the bottom of the value chain of this platform there is a network of Kallyanis (Kallyani and Shukormi Network, KSN), who are micro-franchisee, enrolled with iSocial, offer critical products and services of various mainstream and local suppliers with a profit margin. There are Kallyanis, who are specialized. For example, there

Shasthyo Kallyani (healthcare), Kishori Kallyani (adolescent care), Tothyo Kallyani (SBCC and data collection), and Krishi Kallyani (agriculture, focusing on homestead farming primarily). Based on the needs, new specialization can be developed. This proposal is to develop a revised basket of products and services, which can meet the needs of the small-holder aquaculture farmers as well as profitability of Kallyani by adding other relevant products and services.  

iSocial is developing an independent fulfillment service network (storage and delivery) available from Upazila to Household level at village level (branded as NextMile). This service works as an addition to the supply chain of all major manufacturers and producers in Bangladesh, so that anyone can reach a household through this service to their own beneficiaries. Also, one manufacturer or producer can avail both NextMile and KSN to reach the market, in this case small-holder aquaculture farmers. This system solves the problem of supply side by reducing cost of outreach, for demand side, farmers, small amount of inputs at their door-steps. Digital platforms (web and app) available for suppliers and Kallyanis makes the order processing, delivery tracking, payment and sales tracking visible at a near real-time basis. 

As Kallyanis use smartphones and a mobile app, it is easier to combine knowledge service and input sales from one point to the small holders. A Kallyani, using the app, can place orders, make payment and record sales to each of the clients at the BoP. For this initiative, record of sales and order placement will create valuable insights for the suppliers and policy makers. iSocial’s digital solutions and data analytics capability (branded as DataSense) is able to address the lack of data-driven approach of market players in this sector. 

The primary goal of the project is to create a sustainable micro franchise-based supply chain model to serve the needs to small scale aquaculture farmers. In this process the project will build a network of community-based change agents for meeting critical needs of the community in multiple SDG impact areas including decent job creation, nutrition and partnership. Around 370 micro Franchises will be created within a year.

The small farmers working in aquaculture will get access to inputs and knowledge from authentic sources. This will allow them to increase income, ensure nutrition balance within family and community and contribute to food security. The project will contribute to developing a replicable business model through this experimental project for spreading in other F-t-F areas. It will also help to understand what kind of viability gap funding is required for commercially sustainable models.

  • Supply chain Mechanism: To establish a smooth supply chain, Field officers and iSocial sales and supply chain team visited to local markets and established contact with different vendors who will supply Aqua products to Hub. Field officers is maintaining the overall supply chain system. MFs are using these multiple supply chain platforms to place the order like, they order through the digital platform “Shujog”, iSocial’s call center, or by communicating with Field officers. The sales executive of iSocial accumulated MF’s orders by creating Purchase Orders (PO) which sent to the FMCG Company. After the creation of PO, FMCG companies deliver products to the hub. The Field officers of respective hubs receive the products and deliver the products to MF as per requirement. As there are potential whole-sellers, vendors, AIR in the local bazars, Field officers help MFs for the linkage with them.  
  • Digital inclusion of MF’s: iSocial developed a digital business management platform (Shujog) through with one MF can manage their overall business. By this platform, each of the MF can place their product order and they can record their transaction data and Customer information.  

Success Stories

Obaidul Islam

Obaidul Islam was just an ordinary man from lebutola, Jashor sadaf who was living a miserable life and was struggling a lot financially with his family. He completed HSC but couldn’t continue his graduation due to poverty. At present he lives with his wife, three sons and his parents and for living he works as a framer.

Obaidul Islam was just an ordinary man from lebutola, Jashor sadaf who was living a miserable life and was struggling a lot financially with his family. He completed HSC but couldn’t continue his graduation due to poverty. At present he lives with his wife, three sons and his parents and for living he works as a framer.

He was always in search for opportunities as he decided to change his fate by working hard. With that view, Obaidul joined the Sofol project of Jagoroni chokra as a trainee farmer and has become a lead farmer in his community. Since then he got training and he arranges training for farmers. He always searched for a sustainable solution to make a change.

He joined with iSocial at March,2021 as a Shukormi. Obaidul found the way of his happiness, when he first heard about such an opportunity during the promotional campaign conducted by iSocial. He decided to join the selection workshop. He mostly enjoyed the training sessions as he got to learn so many new things which helped him becoming an entrepreneur. He added that, the basic business strategies, introductory sessions of products, Aquaculture products and services, sales pitch strategies and many other techniques were completely new to him; he would never know those if he didn’t decide to join as a Shukormi.  

After the completion of his training, he started his business but he faced some difficulties such as investment, time management etc. But he is happy now that he could manage all the challenges and started working with Aqua products. In his community he found many fellow ponds, which makes him thinking. After getting Aquaculture training, he talked with farmers and discussed with them about fish cultivation and its important. He already sold some Aqua products to farmers. He started his business initially with Aqua products and some FMCG products.

His plan is to expand his business and get a shop of his own. He wants his family to involve in this business too and make it a family business and bring some changes in his community. After joining with iSocial he motivates other people to become kallyani and Shukormi. He really wants other people to join as an entrepreneur as it helps oneself to get their own identity. He suggests iSocial to continue such initiative and to provide more refresher trainings in future. He wishes good for the future Entrepreneurs for their business. 

Nila Akhter

Nila Akhter is a woman from Jashore Sadar, who lives with her husband, two children and in-laws. She had an ordinary life like any other rural woman of her locality, was doing her daily chores and taking care of her family. But at the end of the day she was not satisfied, she didn’t want to live a life like another rural woman. She always wanted to be financially independent but it was not that easy, as she is only SSC pass. She didn’t get any good job opportunity, also it was not possible for her to do a full-time job after doing her daily chores.

Then she decided to become an entrepreneur and start her own business, but her fate didn’t help there, she didn’t have enough savings to invest. At that point of life, she came to know about iSocial’s micro-franchise programme from a field officer of her area and immediately decided to become a Kallyani.

She joined with iSocial and took training on March 2021 and decided to sell aqua products. She took 50-thousand-taka loan from iSocial to invest in aquaculture products. She bought fish feeds to sell and started selling those to fish farmers door to door.

Now she added Dano Daily Pushti, Joya sanitary napkin and Oral Saline in her basket along with fish feed. Her monthly revenue is 55 thousand to 60 thousand per month. By which she can serve her family very well.

She is happy to become financially independent. Her husband and in-laws are very proud of her. Her children inspire her to work more. She wants her children to be established, she is working hard for that. She also wants to have a large shop to sell more aqua products, she thinks that her village needs a proper shop to buy aquaculture products and she wants to be the pioneer.