Farm to Finger’s Supply Chain Model to Benefit Local Producers

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Farm to Finger’s Supply Chain Model to Benefit Local Producers

Many places in Nepal have become famous for the varieties of produce endemic to these places. Mustang’s apples, Jumla’s jumli marsi, Dolakha’s sisnu powder, Jiri’s chhurpi and Sindhuli’s junaar are some products that most Nepalis are familiar with. In the past, both public and private entities have proposed making use of these local riches to boost economic development and aid local-level empowerment (especially that of farmers). However, only a few organised efforts have actually been made to directly help the farmers get their products to a wider market. Efforts to bring these products to promising markets such as Kathmandu have benefitted the layers of middlemen, rather than the farmers and the local people—resulting in lower returns for farmers and less value for money for consumers. 

Farm to Finger Pvt Ltd, a supply chain management company that envisions changing this situation—by developing efficient models for getting farm products to consumers. The company has been showing promise since its formation in August, 2016: they have been able to find buyers in Kathmandu for high-value products such as apples from Manang, Mustang and Jumla, yak cheese from Jiri, kiwifruit from Dolakha, and black rice from Kavre, among others. They have also enabled farmers to fetch far better value for their products than they would have otherwise. 

 

Finding their niche

The company’s seemingly simple business concept was not born of a simple whim. The founders, Deepak Ratna Tuladhar and Jagriti Shrestha, spent over a year researching the potential promised by their idea, expanding their market reach and building their network before finally registering their company. Before they started the company, the husband-wife duo of Tuladhar and Shrestha were working in the UK, where they were struggling to find a sense of purpose through their work and living through an identity crisis. Both business management grads, they were working as supply chain personnel for different UK-based companies. Although their salaries and lifestyle were better compared to most Nepalis’ here, they constantly questioned how they were spending their productive years abroad. 


And they thus began contemplating a return to Nepal. Because they are business graduates, they were already well acquainted with research processes, and they started studying business challenges and market gaps in Nepal. They soon came to understand that the markets here suffered perennial problems to do with supply chain management. Then a friend in Jumla informed them of problems faced by the agricultural sector. “We learned that there were often four or five layers of middlemen between farmers and final consumers. All these middlemen would need a cut from the final sales amount, and that was the crux of the problem,” says Tuladhar. 

 

Returning home for good and digging deeper   

Seeing that they could put their experience with supply chain management to use in Nepal, they decided to return home. Not long after they got here, they began travelling to various places in Nepal. Their visits were focused on studying the deep-rooted problems that plagued supply chains in Nepal, identifying the special products of various locations and forming an initial contact with these products’ farmers. “Our initial assumptions about the problem were validated when we went to Manang, Mustang, Rasuwa, Sindhuli, Ilam and other places, and talked to producers who resided there,” explains Tuladhar, recounting the initial days of their travels across Nepal.

 

Networking with the first vendor

Two months before his company started operations, in August 2016, Tuladhar was selected as a participant in a High Value Agriculture Project field visit to Sikkim that was organised by the Ministry for Agricultural Development of Nepal Government. The objective of the trip was to understand the supply chain management system that Sikkim used for selling its apples. Tuladhar was part of a team consisting of farmers, experts and potential agricultural entrepreneurs. Tuladhar, who was selected as a potential entrepreneur, made use of the opportunity to form bonds with farmers from Jumla, Dolakha, Mustang and Manang, who travelled with him. Krishna Rokaya, an apple farmer from Jumla was one such contact, who later became the first partner of Farm to Finger.

 

From Farm to Finger

Farm to Finger started their operations with the limited resources they had. They held initial consultations with farmers (in order to estimate their supply volume), created a small database of friends and family (who later became customers) and came up with models for increasing the demand and marketing the products. In the early months itself, they successfully marketed and sold more than seven tonnes of high-value apples from Jumla, Mustang and Manang. When apple season was over, they sourced walnuts from Jumla, kiwifruit from Dolakha, yak cheese from Jiri, potatoes from Mude and so on, focusing on a different product with the changes in season. 

Farm to Finger’s approach consisted of first reaching out to and creating an informal contract with farmers and coming up with ways to get higher returns for them. They then focused on showcasing the products to buyers and gauging demand. “On average, we have been able to pay at least 20 per cent more to farmers, while charging at least 20 per cent less to the consumers—thus benefitting both the producers and the consumers at the same time.” 

 

Increasing their market

The indigenous product varieties that Farm to Finger are looking to sell require efficient marketing and sufficient promotion—in order to figure in a buyer’s radar. That’s why before the season for their products starts, the founders spend hours scrolling through their database and reaching out to both buyers who might have never tried their products and those who are already familiar with the varieties they are trying to sell. According to Tuladhar, a substantial part of their buyer base is made up of migrants to Kathmandu who grew up consuming the products Farm to Finger trade in. And Tuladhar is sure that more Kathmanduites—even those without immediate roots in Nepal’s hinterlands—will soon become dedicated customers because his company is marketing products that have already been received exceedingly well in their places of origin.

First published in M&S VMAG.

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