Reducing Poverty through Honey Production and Distribution Project

Location: Malawi

Background

In May 2018, a rural poor woman, Mary T, travelled for about 145kms to sell her groups’ bottles of honey to honey processors and formal retailers in the Blantyre city region. The honey failed to even pass the minimum quality needed by the companies.

Footsteps Africa discovered many reasons behind this:

Lack of modern honey production and processing skills exist among rural poor women to produce quality honey demanded by formal honey buyers and exporters
Lack of modern bee hives to produce high yields quality honey
Lack of proper honey extraction machines and soft knowledge on extracting honey for high-end markets
Knowledge and skills gaps in proper storage, packaging and branding
Knowledge gaps in business management and recording, financial literacy, access to saving and credit
Lack of improved personal hygiene and lack of access to affordable clean water solution needed in honey processing and for the women's and their children to live a health life.

The story of Mary’s efforts reflects the economic struggles that women’s traditional bee keepers faces in Malawi due to low-quality honey that prevent them from accessing viable markets that could generate good income for their productive efforts. Additionally, apart from honey, women beekeepers in Malawi rarely develop trade in other by-products of bee farming such as bee-wax that could double their earning potentials.

Supply Size Market Analysis of the Honey Industry in Malawi

At the macro level, women in Malawi constitute 80% of the agricultural labor force, the main sector of the economy. However, women top the list of the social and gender group of people affected by poverty in a country where 53% of its population lives below the 2$/day, World Bank (2016). One of the reasons for this problem is that many rural women engage in petty trade and are left out of products value addition and access to markets that offers competitive returns and hence reliable income. One of the major reason women are stuck in petty trades is lack of appropriate skills, capital and market eco-systems support. Another factor for low income from honey is the fact that Malawian honey is commonly sold in unlabeled containers such as used water bottles and small plastic tubes by middle-men at the decreased income for the women farmers opportunities.

Demand Size Market Analysis of the Honey Industry in Malawi

The domestic demand for honey is high in Malawi. The national aggregate production output has a deficit of 30% to satisfy consumption. Many of the consumers of honey in Malawi relies on cheap and low-quality honey in the informal market. The honey in the formal market is packaged in bottles out of reach of the majority of poor people in Malawi. This project will help the women to package honey in sachets to reach out to different markets such as schools, hospitals, and most important low-income families in both urban and rural areas of Malawi. Apart from this, high quality honey in Malawi has an export potential.

Honey Market Analysis in Malawi

Malawi has a population of over 18 million people and is an ideal market for honey products packaged in small affordable units (sachets). There is however a need to further develop the market for such products. Taking into consideration the marketability of products such as sachet-packed milk and juice drinks, washing powder and dairy-based drinks, the packaging of honey in small affordable sachets for consumers should benefit from current miniaturized product marketing strategy trend in Malawi.

Differential Marketing Approach

The Miniature Honey Market, The Market of Low-income Honey Consumers

The general trend in packaged product marketing is usually to target the middle- and high-income earners living in urban centers. To capture a high percentage of Malawian consumers, Footsteps Africa intends to market it’s products by targeting both the urban and rural consumers. The idea of sachet-packed honey was also conceived to make it affordable to the lowest income earners who are at the bottom of the pyramid (BoP) such as smallholder farmers, school children and those residing in remote rural areas. It is worthy of note that the knowledge that the honey is produced by organized beekeepers’ groups will make the consumer satisfied and assured to buy the packaged sachet-packed honey.

The Bulk Market of Honey in Malawi

The honey supply value chain involves a lot of stakeholders besides the actual farmers being targeted by Footsteps Africa. The major ones amongst them include industrial users, merchants, retailers andhoney exporters such as the Bee Hive Group LTD.Studies have shown that each of these stakeholders is beset by capacity and knowledge constraints that greatly inhibit their performance and entrenchment. The effect of this poor performance is low productivity and low income for the producers as well as market inefficiencies, which favour middlemen at the expense of the producers.

The Business Model of the Project

It is against the above background that Footsteps Africa intends to organize traditional bee farming women to engage in modern bee farming, processing and marketing of high-quality honey and its by-products. The project will help the women acquire modern bee farming and honey processing skills. The project target to access two broadly defined markets: The low-income earners’ markets that will be provided high quality sachets packed and branded honey. The second market, project will help women to access formal markets such as the Bee Hive Group and honey processors. The project will help the women to centralize collection, processing, packaging and marketing of the honey into bulk volumes.

Project Specifics

Description

The main goal of this project is to improve the income generating capacities of rural poor farming women in Malawi through high value adding bee keeping farming. The project will build capacity of women bee farmers groups into modern bee farming, support them with modern bee keeping kits, train them in processing and packaging according to the market’s standards of The Bee Hive group, and empower them to sale their bee products to the Bee Hive Group and other formal honey processors and buyers. The project has entered into a market agreement with the Bee Hive Group which has untapped bee market across Southern and East Africa. In addition to this, the project will organize and train the women in village savings and lending to improve their financial literacy skills and mainstreaming personal hygiene and sanitation at each processing centers and their respective households.

Innovation

This project will support women to package honey in sachets and/or small bottles
Help women to process bee wax for market
Produce high quality honey for processors, retailers, and exporters

Overall Goal

To build the capital, business and marketing capacities of rural bee farming women to engage in value adding honey processing and branding that access profitable markets.

Objectives

To provide capital investment to rural women’s bee farming
To build rural women’s capacity skills in modern honey processing
To support rural women’s bee farmers to market their honey to viable markets
To build the financial literacy skills of rural women’s bee farmers

Key Activities

Purchase of 3 stainless steel manual honey extractors with full accessories
Purchase of 30 high yielding modern bee hives
Purchase of 30 bees protective gear, smokers and minor accessories
Train 50 women in high quality apiary construction and bee farm field techniques
Train 50 women in quality honey harvesting, Extraction, honey comb, propolis, royal jelly and wax
Train 50 women bee farmers in improved bottling and packaging in miniature sachets
Train 50 women in Group Governance and Leadership and formation of Production Groups and Cooperatives
Train 50 women in group dynamics, group production, business management and recording
Train 50 women in Village Savings and Lending, and financial recording and personal investment
Train 50 women in personal hygiene and sanitation

Expected Outcomes

The impact of the project will be improved quality of life for 200 rural poor women. This will be achieved by the following three specific results:

Increased sustainable income generation capacities; The project will invest heavily in both soft skills and capital equipment for increasing honey production, quality processing and packaging. This will enable the women to fetch high price at the high-end markets and hence increases their income.
Increased access to savings and credit from community banking the targeted women will be trained in village savings and lending to enable them to save and access credit which they are lacking now. They will also be taught personal investment for building assets

Monitoring and Evaluation

We will register each woman we are targeting and record their current income levels and cash-flow.
We will track this data-base throughout the project and record how each woman income is changing
On the same, we will be conducting a mid-term and end-line interviews of the women to triangulate the income changes they have experienced through this project and capture stories of change, photos and videos of the success stories and periodical progress report.
We will also engage the media to interact and interview the women to document their changes.
We will give the women savings books, which will be recording the savings and credit accessed by each woman. At the end, we will be able to track cumulative savings and credit of each woman.
We will interview women on quarterly basis to check how they are implementing personal hygiene in their households and during honey processing.

Beneficiaries

200 rural poor women living around Nyika National Park in Northern Malawi. Their age range is between 25 to 45. The project will target rural poor women who are engaged in traditional bee farming and those interested to start this business. These are rural poor farmers who live on less than 2$/day according to the World Bank poverty line. They also currently have no access to saving and credit and currently are ignorant of the importance of improved personal hygiene in honey processing and for prevention of water borne related diseases.

Sustainability

The project has been designed to empower rural poor women to produce honey and engage with formal honey markets.
The women will be supported to network with multiple formal buyers. The capital equipment provided to the women has a life span of not less than 20 years of continuously producing high volume quality honey.
The project has invested more in capacity building to build the human capital capabilities of the women.
The project was designed from a market point of view, enabling the market to support the bee farming activities beyond the project life.
Footsteps Africa will work very hard to ensure that the women are connected to formal markets and will negotiate good market deals with the participation of the women.
The village savings and lending component is a self-sustaining bank for the women that does not require external financing to start and operate. This is critical to help women save and grow their money without engaging in external borrowing i.e. they will use their savings to create sustainable credit.
The project will organize the women into producer groups, and train them into governance and leadership. At the end the women will develop a constitution that each member will contribute and sign off as by-laws for governing the group.
Our markets assessment and contacts with formal honey buyers in Malawi indicate a huge market deficit to satisfy the formal honey market in Malawi. The market for quality honey exist what is needed is just to position the women to align their honey with the markets needs and demands.

Project Partner: