6.3.7 Apply Mainstream Scale-Up Strategies in Rural Areas

Reaching larger numbers of people (scale) is more daunting in rural areas, because of lower population density, lower infrastructure and communications, and a target population that is harder to serve because of multiple barriers to employment. Nevertheless, the same main strategies for reaching scale apply: 

  • Streamline operations,
  • Leverage technology,
  • Support social movements,
  • Strengthen market systems,
  • Partner with large, private companies,
  • Advocate for significant policy change,
  • Systematize initiatives through the government, and
  • Expand viable social enterprises.

Over the long term, sustainable institutions and systems ultimately reach more people, expand service variety, and provide resilience to external shocks. So, organizations seeking to reach larger numbers of people should be careful to avoid short-term, highly subsidized project expansion over the more systemic approaches listed above.
 

Strategies for Reaching Scale and Sustainable Cocoa Sourcing

The case of sustainable cocoa sourcing illustrates mainstream strategies for reaching large numbers of farmers, outside of the expensive, unsustainable strategy of “project replication.”  Founded only in 1998, Armajaro Trading Limited is the second largest cocoa supply chain manager, in terms of volume, and the market leader in traceable and certified cocoa. They source from all major cocoa exporting countries, and clients include major brands such as Ferrero, Hershey, Lindt, Mars, Mondelēz and Nestlé. Armajaro’s sustainability policy states their full commitment to the principles of sustainable sourcing, including their responsibility to work with the rest of the international community to eradicate the worst forms of child labor from the cocoa supply chain. A key foundation for ensuring sustainability is traceability, the ability of buyers to “trace” individual cocoa bean bags to the farmer groups that produced them. 

A second foundation is building the capacity of farmers to produce profitably and sustainably. Armajaro is accomplishing this through its partner NGO, SourceTrust (www.sourcetrust.org). Source Trust operates using social enterprise principles. It is funded in part by a voluntary premium on cocoa produced by assisted farmers and sold to Armajaro’s clients, and in part by supplemental donor funds that leverage these corporate fees. SourceTrust provides farmers with training in entrepreneurship as well as improves agricultural practices that increase quality, yield, and long-term sustainability. In addition, SourceTrust strengthen the market and community systems around farmers, investing in nurseries and input supply systems, farmer resource centers, farmers groups, community infrastructure, malaria prevention, and other sustainable solutions raised and supported by farmers, clients, and the businesses and organizations in the “cocoa system.”.  

The system is supported by technology run by GeoTraceability (www.geotraceability.com).  GeoTraceability provides access to, and training for, the use of digitalized systems that allow Armajaro to collect, store and organize data on the farmers who are registered in its sustainability programs. The farm and socio-economic conditions of each farmer can be registered and changes in farmer behavior, resulting from a program’s activities, are monitored.  GeoTraceability systems then allow Armajaro to trace the bags of cocoa produced by these farmers to ensure delivery to the customers who are supporting the program’s activities. The data collected highlights the issues farmers are facing so that Source Trust can tailor services to meet specific farmer needs.

What drives this sustainable sourcing system? Farmers get better prices and sell more, so that investments in better practices pay off. Buyers get a more reliable quality and volume of supply, and the assurance of traceability and sustainable production, for which they are willing to pay a premium. Why are cocoa buyers so interested in sustainability? Because social movements around the world have raised consumer, investor and policy-maker awareness about egregious working conditions of children on cocoa farms, low returns to farmers, negative health and environmental effects of toxic agro-chemicals, etc. These movements have raised the demand for sustainable practices, including adherence to national labor policies. And so, one can see at work in this one case, every strategy listed above for reaching scale.