I worked on this over the summer as I explored the different transport models in Africa.
Objective: evaluate the potential for vaccines (and medical supplies) and agricultural products to share the same supply chain.
Evaluate the status quo:
· In a given area, map out how agriculture and related goods, such as seed, fertilizer, tools, move between farmers and markets or ultimate buyers.
o What normally moves between farms and markets (both directions)?
o What are the cost, quality, time, and information / reporting requirements of moving these goods?
o What comprise the segments and functions of the supply chain?
o Where are the information asymmetries in the supply chain and markets?
o Who captures what value in the supply chain?
§ Farmers
§ Traders
§ Pure transporters
§ Large buyers and exporters
o Where are the inefficiencies or gaps in the supply chain?
· In the same area, identify rural health centers and map out how they are supplied with vaccines and other medical supplies.
o What is the mix of public health centers and NGO or FBO health centers?
o What medical commodities move between national and regional stores and rural health centers?
o What are the cost, quality, time, and information / reporting requirements for these medical commodities?
o For each, are there defined processes, whether push or pull, for supplying rural health centers or is the system ad hoc and opportunistic?
o Where are the inefficiencies or gaps in the supply chain?
· Identify and evaluate the options for moving vaccines and other medical supplies
o Identify and analyze the challenges facing consolidation of medical supplies and agricultural goods.
o Evaluate the potential role and development of community-based LTL (less than truck load) entrepreneurs based on the SABMiller distribution model.
o Evaluate the potential of using VillageReach’s MIS system of vaccine delivery verification for fair trade authentication.
Here is a research project that I completed during my internship this summer. It details the different models of transport currently being utilized in Sub-Saharan Africa.
A Brief Description of Transportation Models in Sub-Saharan Africa
After an analysis of the transportation system in sub-Saharan Africa I found that there are an average of four different models being utilized. The models may differ in each county but in general the components to each model seem to be similar. Furthermore, the models are generically defined and one or more of the models may share similar attributes with other models.
Corporate Model: (ADM, Cargill)
Multi-national agriculture companies looking to transport goods out of a developing country purchase assets in this model. The model is one where the corporation enters the country and purchases or leases its own farms and/or transportation system. The control of these assets through the entire system flow allows the multi-national full control of entire process, thus becoming more efficient.
Corporate - Non-Asset Based Model (Starbucks, Hersey)
Multi-national product companies looking to transport a specific commodity out of the country may establish this model. In this model the transportation system is not owned by the multi-national, instead a contract is negotiated with the exporter and farmer to ensure that is fair trade. The transportation system is leveraged to meet the needs of the multi-national. The system is less efficient but allows for community and economic development with-in country. It may be challenging to follow the flow of goods and money through this process flow.
Commercial and COOP Model
Local farmers leverage a combination of their resources to allow for better purchasing power and selling power in this model. With the combination of their resources the farming coop has the ability pay less per transport move to move their goods to the capital. The farmers must still negotiate with the transport driver but have more leverage due to the combined resources of the coop. The system is somewhat efficient but still leaves the farmers at the mercy of the transport companies. The farming coop aspires to purchase own transport vehicle in the future in this model.
Trader Based Model
A local famer is at the mercy of the exporter and the transport system in this model. This system flow is in reverse of the previous models. The exporter is contacted by a multi-national and signs a contract for $X to secure Y Kg of a commodity. The exporter then requisitions a trader to go out and start acquiring the commodity. The trader from the city contracts with smaller traders in a district for the commodity. The district trader then may contract with rural traders to acquire the commodity. Money changes hands through each step of the process. The rural trader goes in search of a rural famer growing the commodity and offers $X to take the load to the city. The farmer does not have an option to negotiate the price since he does not know when another truck may be coming. The risk to the farmer is loosing his entire crop if he cannot get it to the market.
