Beth Mwangi CEO, Ideal Matunda
You manage the agribusiness company Ideal Matunda. What products and services do you offer?
We produce fresh avocados and crude avocado oil for the Kenyan market and for export. We also have fresh passion fruits, mangoes and French beans, among other vegetables. We have focused on avocado production due to the high potential demand and the reliable supply of high quality fruit. Meeting the international requirements is an expensive undertaking, since Global GAP certification for each product is required. For a SME like Ideal Matunda Ltd, it is prudent to focus on one crop at a time to ensure the needs of customers are exceeded in order to build customer loyalty. That is why we have focused on the avocado as a pilot project, before scaling up with additional products and services.
How did it all start and what inspired you to set up your business?
Business operations started in 2007. I was inspired to set up the business after managing a project aimed at improving the livelihoods of farmers by improving the quality and quantity of their produce to meet international standards. I was impressed by their hard work to meet the set standards. Unfortunately there was no ready market, leading to losses when quality produce was not sold at equitable prices. Having grown up on a small farm in Central Kenya, I empathized with the farmers and was keen to work with them. As a trained economist, I quickly saw that access to reliable and profitable markets would provide them with a good opportunity.
How does your business help to improve the lives and livelihoods of smallholder farmers?
We sign supply contracts with our producer groups, indicating the minimum guaranteed prices at the start of each season. This motivates them to invest in the adoption of good agronomic practices to increase the quality and quantity of production. Access to a reliable and profitable market provides a steady and growing household income. The signed supply contracts facilitate access to farm inputs and loans from commercial financial service providers, like commercial banks, microfinance institutions and Savings and Credit Associations. This enables rural households to meet their everyday needs, like medical expenses, educational needs and other investments. What are your plans for the future? We are currently relying on leased facilities, including packing and cooling facilities, which can be restraining. In the medium term, we intend to invest in our own packhouse and packing line, which enables us to scale up our operations. Scaling up will include: introducing new product lines and value addition by drying fruits and vegetables to reduce the risk of perishing. For our expansion we intend to attract a strategic investor.
How did you experience doing business with the Dutch? Were there cultural differences/barriers? Is there a particular interesting encounter with the Dutch that has stayed in your mind?
We have had good experiences doing business with the Dutch. Dutch companies buy fresh fruit from us for distribution in their local markets. The Dutch warmly embrace people, a characteristic shared by all Kenyan cultures, which makes it easier to do business with them. For effective trading, they share information on market requirements and price trends, which we can pass on to our suppliers. Apart from language, the only significant difference is the size of what is defined as small-scale farming. Compared to the Dutch, what is practiced in Kenya can be more aptly described as micro. Personally I had a particularly interesting encounter with the Dutch under the Green Solutions programme. We visited a tomato farmer and I was highly impressed by the level of technology employed at the different stages of production, harvesting and post-harvest handling.
Finally, since you are an “insider” to agribusiness in Kenya, what advice would you give to Dutch companies who are thinking about expanding to Kenya/Africa?
My advice to Dutch companies is twofold:
There is a lot of scope to invest in Africa at the moment, since the potential of agriculture is not yet fully exploited. The key barriers are access to capital, technology, skills and experience. Dutch companies have the resources and experience required to overcome these barriers and fully benefit from the existing potential.
Partnering with SMEs in Kenya / Africa will be mutually beneficial, as it will enable these enterprises to adopt appropriate technology, scale up and reap the economies of scale associated with large scale enterprises, while Dutch businesses can immediately take advantage of local knowledge and networks.
For more information, please visit: www.idealmatunda.com