SMALL BUSINESS DEVELOPMENT THROUGH LIVESTOCK HEALTH

This highlights four types of experience of developing small businesses in rural areas where land is communally owned: one in Lesotho involving the wool and mohair industry; one in the Elundtini area of the Eastern Cape where a major study revealed the impact on farmer income and hence job creation; another is a wool and livestock experience in Southern Lesotho and finally the cross cutting feature of small businesses that we have designed and set up to take over all our work and sustain its impact.

In all these deeply rural areas where life is mostly based on traditional systems poverty is overwhelming and deep rooted. Livestock is for many the only way to make some money but a lot of the time it is just a matter of struggling to keep the small flock alive so that it can be sold to help deal with a sudden crisis.

Lesotho Wool and Mohair

Dr Alastair Paterson in November 2006 evaluated a project we implemented on behalf ComMark and what we present here is taken directly from his evaluation.

His opening comment is: This project has had an incredibly positive impact on improving the status of the shearing sheds of licensed (wool and mohair) traders as well as improving the asset value of the participating farmers.

There were 4776 actual farmers participating in the project in September 2006 which was a considerable increase from the 116 in September 2004 at the start of the project and the 2885 in September 2005. Veterinary treatment sites have been established at many villages. Presently there are 102 sites being serviced by the four mentors, 7 field workers and 7 agents.

The most outstanding result of the project is the increase in the asset value of the stock of participating farmers. This amounts to over R65 million in total and over R13, 000 per participating farmer. This is due to an increase in reproductive rate and reduction in mortality due to the animal health component of the project.

A very strict program of visits to the sheds and sites is in place where the farmers know the date of each monthly meeting at the sites. These programs are advertised in the sheds and farmers are reminded at their villages of the impending site visits.

The point is that the private sheds are now run very efficiently and the owners of the sheds confirm that the input by the project mentors and field workers has resulted in excellent standards being attained. Most of the employees at the re-established and new sheds had little knowledge or skills when they started but were actively mentored by the project team and they acknowledge that they are far more effective at their work now than when they started.

The achievements in the first year of operation, in terms of intervention and records, are outstanding.

Dr Paterson had much more to say but for now his statements and the figures speak for themselves. They show he high level of engagement by farmers – which as with all Mngcunube work is on a voluntary basis so no farmer is obliged to engage or stay engaged in projects we implement. Among the striking results The item we focus on here is that the project resulted in participating farmers getting an increased income of R 13 000 a year from their flocks due to better birth and survival rates arising from the basic village based animal health treatments part of the work. For an ordinary family this is the equivalent of having a family member getting a full time job at minimum wages of the day. They now have R 13 000 they can use as they wish: to consume as meat and/or to sell as live animals or to ‘bank’ so that it can grow more wool/mohair and make more lambs/ kids net year.

The Elundini Livestock Project

This project was run on the same principles and model as all the others although with a well-established set of shearing sheds operated by local people under arrangements with some of South Africa’s major wool buying and marketing companies it did not engage with this aspect. It focused on using mentors to make village visits to offer animal health services and in the process to identify local farmers with the potential to take over this work from the project. We call these people VLPs. They can do what they do because he project requires farmers to pay for the cost of each treatment given to each animal and there is a small mark-up involved on the cost of these medicines. This means that a well-trained VLP with enough clients can provide goods at a small profit per item and while making a living also sustain the service and the impact of the project.

The Elundini project was the subject of an independent study by Dr A Jordaan of the Free State University, commissioned by the donor which was the Thina Sinako project financed by the EU. Here is the heart of what they had to say:

“The research concluded that the results of the mentorship program by far exceed normal expectations. It became clear during the research that data capturing was done with precision and great care. The data gathered is impressive not only in the robustness and the amount of data but also in the results. The importance of measuring is again highlighted in that the results of the project could be accurately assessed. The data is sufficiently robust to substantiate the positive results of the project. The methodology for data capturing and analyses was not originally designed as a scientific research project. The purpose of the data-base is to measure the project impact; a goal well achieved. Accurate analyses of the data were possible, the data is robust enough and the volume of data was sufficient to ensure reliability. Data for the first 18 months of the project clearly shows a reduction of mortality rates for sheep and goats from more than 30% to as low as 3% per annum. Lamb weaning and kid weaning rates is approximately one lamb for every two ewes (50%). Individual sheep farmers are able to increase their potential annual gross cash income from as little as R416 to R18 306 and goat farmers could increase their gross income from R196 to R4, 312. (Income is potential because unless and until farmers sell or use some of the increased number of livestock resulting from the project they have an increased asset but not income). The additional potential net economic contribution from sheep farmers participating in the project is R50 million and R4, 5 million from goat farmers. Project costs to date add up to R6, 355 million and farmers contributed R565, 940 from their own funds. The net economic benefit adds up to more than R48 million without taking into consideration the downstream and upstream economic benefits. This research also concluded that the hands-on approach of farmer mentorship by Mngcunube is indeed an example to be followed by extension workers and other development agencies. The results are evident from the onset of the project and the immediate financial gain to farmers ensures their continued participation in the project. In addition to the direct benefits to farmers, new business opportunities are created for village mentors.”

So this independent analysis also validates the method used, the impact, the way data is used in measuring what the projects doe and what it achieves and on sustainability.

This was implemented by Mngcunube in southern Lesotho between March 2002 and November 2005. The objective was to sustainably increase returns to livestock owners through improving the quantity and quality of livestock (and livestock products) and in particular sheep that formed part of their existing livelihood assets. The final project eport we complied for the donor incuded he following:

“As far as methodology was concerned there were several key features:

• Experienced farmers served as mentors, employing a facilitative learning approach applied in a routine of regular village visits rather than a class room or demonstration approach
• Mentors worked in tandem with field workers drawn from the local community
• All inputs used by farmers, such as veterinary medicines, were paid for by them.
• Wool shearing was facilitated by the project in terms of training of local people and field workers in key shed operations such as shearing, classing, baling and record keeping.
• All wool was bought by licensed commercial traders, with the project brokering prices and relations between the trader and the farmers
• Sustainability was approached through (a) building the attitude of farmers to animal health and good wool growing and (b) trough training and equipping the field workers, and linking them with commercial suppliers of inputs and advice.

The Main Results:

• Over the life of the project 237 000 and 23 000 goats were sheep were handled, along with large numbers of cattle and other livestock, during the course of 970 village visits
• The actual number of sheep covered by the project was 33 637, belonging to a total of 2 228 farmers.
• The average number of sheep owned per farmer grew from 10.4 to 18.6, illustrating the impact of the project in reducing deaths and increasing lambing
• The number of sheep shorn per season increased to over 18 800 with a total mass of over 50 000 kilograms
• The average weight of wool per sheep increased from 2.31 kg to 2. 88 kg – an improvement of nearly 33% despite drought and other stresses on the sheep.
• The proportion of wool in the better, higher value classes (AH to C versus lower than C) improved from 32% to 42%
• The death rate for sheep fell from over 14% to 1.1%
• Farmers invested a total of nearly R 200 000 in their livestock during the life of the project at an average cost per farmer of nearly R 90 (2005) and an average cost per sheep of       R 4.73 (2005)
• Total project costs were R 3.386 million

Impact

• The actual returns for wool fell by over 50% during the life of the project because of the trend in international wool process and exchange rates. But if indexed to 2000 wool prices the return to farmers for each kilogram of wool grew from R 13.40 to R 16.10
• The value of the wool clip, indexed to 2002 (start of project) prices rose from R 98 935 to R 745 343
• With 2002 as the base year farmers by 2005 on average increased their income from more and better wool, reduced mortality of sheep and improved lambing by to R 647. Total benefits across all participating farmers thus increased by R 1 173 516
• By 2005, for each R 1 a farmer spent an increase in value for sheep only of R 11 was achieved
• The total value of sheep only at 2005 was R 17 037 864. Given continuation of existing rates of improvement (limited by a cap on wool weight, wool quality, improvement in lambing and mortality rates) the total value of sheep will be over R 27 000 000 in 2008”

This was the first of the livestock projects we operated using the model of farmers paying for the medicines used on each animal, of voluntary participation, of mentoring and learning through a cycle of monthly village visits and the training of local farmers as VLPs to take over our work. These VLPs are still operating more than 10 years since he project left them to carry on with their small businesses.

Village Link Persons (VLPs)

We have already mentioned that these are men and women we train and mentor in the field because we see they have the potential to take over the work we do and thus sustain its positive impact on livestock owners and the local economy. We have a huge body of data on their performance overtime so this is just a summary that shows how many of these small businesses have been created and how well they are doing.

There are over 60 functioning VLPs across old and current projects serving over 26 000 farmers spread across over 1000 villages.

In terms of their outreach and income these are VLP results across current projects across the Eastern Cape:

(SSU denotes Small Sock Units where cattle count as 6 SSU and sheep and goats one SSU each)