How Strengthening Cooperatives Unlocks the Potential of Farmers and Communities
Since 2018, Land O’Lakes Venture37 has been implementing a USAID-funded Cooperative Development Program in Rwanda and Malawi called Cooperative Development Activity 4 (CD4). Through coaching, training, business advisory services and strategic networking, CD4 is strengthening 12 agricultural primary cooperatives and eight cooperative apex organizations in both countries. A primary cooperative is an organization of individual farmer members, whereas an apex cooperative is a group of primary cooperatives that work collectively to achieve common goals. A strong cooperative provides farmers with many advantages and services, such as greater leverage for purchasing inputs and selling products, as well as access to trainings and other services such as loans. CD4 is coaching current and growing leaders of these cooperatives on leadership and management skills; coaching cooperatives on business management, governance, and other skills; and linking cooperatives with other organizations and businesses to strengthen their economic growth.
A survey in mid-2020 of a representative sample of members of all the cooperatives revealed that just two years into the program, CD4 is already helping cooperatives provide a larger number of services and higher quality services to members — and these diverse offerings are being recognized by members. CD4 activities have also contributed to member confidence in their leaders and being more likely to recommend joining their cooperative to non-members. These are substantial achievements to make in less than two years’ worth of activities, especially during a second year that was dominated by the COVID-19 pandemic.
Increased awareness of services
In two years, CD4 has contributed to improvement in members’ awareness and rating of services provided by their primary cooperative. For example, identification of and negotiation with buyers was the most commonly mentioned service at baseline and in year two; the percentage of members who said their primary cooperative provides this important service increased from 59% at baseline to 86% in year two. Similarly, the percentage of members who said their primary cooperative provides training and technical advice increased from 52% at baseline to 83% in year two. Other important services commonly mentioned by members include: regular and prompt payment for the products sold (48% at baseline; 71% in year two), loans for inputs (30% at baseline; 64% in year two) and quality verification of the products (35% at baseline; 60% in year two).
Increased quantity and quality of services
Members also said their primary cooperatives are now providing new services that they were not providing at baseline. For example, 48% of respondents said their primary cooperative is now providing advocacy services. Other new services provided include an emergency support fund (31%), crop and livestock insurance (30%), and members’ medical insurance (10%). Most of the additional services result from internal factors such as the increased trust and enhanced collective action; others stem from changes in the cooperatives’ operating environments, new opportunities and external factors like the COVID-19 pandemic. In fact, a COVID-19 study implemented by Venture37 showed that the adaptive nature of cooperatives has aided in overcoming COVID-19-related challenges.
In addition to helping cooperatives provide more services, CD4 has helped cooperatives provide higher quality services. The overall score for how well members rated the quality of services provided by the cooperatives increased by 253% from baseline. For example, with support from CD4, one cooperative in Rwanda secured contracts with two major market actors to purchase members’ legume and vegetable production. Another cooperative in Rwanda supported by CD4 began providing cattle feeding trainings to members to help farmers increase milk productivity.
Increased confidence in cooperative leadership
The survey revealed that CD4 capacity building efforts also contribute to more confidence in cooperative leadership. The level of confidence members have in their primary cooperative leadership increased from 80% at baseline saying they were fully confident or somewhat confident that their leadership has the knowledge and experience to manage the cooperative to 92% in year two. This is likely due to leadership, governance and financial management coaching provided in year two. The baseline found that there is a strong positive correlation between the frequency of members’ interaction with primary cooperative (and apex cooperative) leaders and their engagement in cooperative activities. This would suggest that with increased confidence in their leadership, members will likely increase their engagement in the cooperative, thereby strengthening the cooperative.
Finally, CD4’s work has also helped members be more likely to recommend the cooperative to others. Members are more willing in year two to recommend others to join their cooperatives: 88% of respondents said they recommend non-members join their cooperative, compared to 77% at baseline.
The survey revealed that CD4 is contributing to members having a higher degree of satisfaction with their cooperative. CD4 will continue to build on this strong foundation and support cooperatives in Rwanda and Malawi to further grow their businesses and support for smallholder farmers. This model of support could be expanded to further strengthen cooperatives around the world — and their farmer members — facing similar challenges.