The Global Farmers Market’s (GFM) story dates to 2013, when Jonathan, the Swiss founder, was visiting local villages of the Lago District in Northern Mozambique. Jonathan was stunned by the abundance of mango trees that naturally grow in the region and noticed that the supply of mangos by far outstripped demand. Consequently, tons and tons of mangos would go to waste rotting on the ground every year. He immediately recognized that the surplus of mangoes could be turned into an opportunity if only he would be able to find a suitable market for the fruits. Jonathan wanted to create a business model that actively integrated the local communities he sourced the mangoes from, making the people of the Lago District the ultimate beneficiaries of the value created. The underlying vision was to support the development of the region by leveraging the natural resources it had to offer.
After some experimenting, Jonathan concluded that drying the mangoes and selling them as healthy snacks in Europe was the best way to bridge the gap between the local communities and a potential market. He started building a processing facility in Nhkolongue, a remote village in the Lago District, and some artisanal fruit dries to test his idea. In addition to that, he envisioned an innovative branding strategy. Every package would be presented with the picture of the person and tell the story of the smallholder farmer that produced the mangoes. The high prices he would be able to charge in the European markets would allow him to pay higher prices for raw products and fair wages, increasing local communities’ incomes.
Within two years, GFM had grown from a mere concept into a start-up company that was producing over a tonne of dried mangoes a year. A major turning point in the history of the venture was when Jonathan was awarded a grant from FinAgro, a four-year program funded by USAID and the Government of Mozambique, which aimed at increasing the competitiveness of the Mozambican private sector in selected cash crops and value chains. This grant was used to finance the purchase of a commercial-grade fruit dehydrator and a truck. These assets allowed GFM to witness a growth in production of more than 200%, with output increasing from 1100 KGs in 2015 to 2400 KGs in 2016 and employing 70 people during the mango production season.
Currently, the business model has been fully implemented and its viability proven. In 2016 alone, the GFM was able to locally source 100 tones of mangos from more than 400 smallholder farmers of 9 different communities. In 2017 Jonathan, with the support of TechnoServe (an international non-profit organization), has started to work on an expansion plan that will guide his company’s growth in the next years. The expansion plan will culminate with the opening of a new, larger factory in Mozambique that can better accommodate the growth of the company and exploit the business’s full potential in the years to come.
The expansion strategy will lead to a significant growth in output and a crucial part of the success of the plan will be to increase sales accordingly. At the moment, GFM sells its product (organic certified mangoes and bananas) only in Switzerland. Given the high quality of the product and the innovative branding, retail prices go as high as 9 CHF (Swiss francs) per 100g, clearly positioning the company in a niche market.
Learn more about Global Farmers Market here: https://www.globalfarmersmarket.ch/
As Jonathan is taking care of the supply side of the business, he needs some support on the demand side from the NGC consultants, specifically with regards to pricing and consumer insights for the Swiss, German, Austrian, and French markets.
Specific recommendations to be developed by the Consulting team are:
1. Analyze strategic opportunities for market entry
a. Create a strategic framework to narrow down the geographic areas within the proposed European countries (Example: Southern Germany, specific cities in France)
b. Suggest a pricing strategy for the markets of interest by conducting sensitivity and benchmarking analyses
2. Identify potential partners within the identified new markets
a. Propose four wholesale partners within each selected market and gauge their interest through interviews and/or correspondence
b. Gather quotes from the selected wholesales
The managing team of Global Farmers Market will incorporate your recommendations when operational, tactical and strategic decisions are to be made in the near future.