Table 1 Key features of selected milk value chains from SSA countries
Business
model
Country
Driving force
Rationale for smallholder milk
producers
Precondition
Approximate
market
share (%) Challenges encountered
Source of
information
Collective
action
Kenya
Perishability.
• Easing bulking and transportation of
milk to processing plant.
• Ensuring adequate oversight on
milk quality and economies of size
during transportation, processing
and marketing.
• Group as platform to access other
business support services.
Previous experience
with contract
farming.
20
Difficulties in holding
management accountable to
members leading to:
• Mismanagement of resources;
• Overinvestment in fixed
assets; and capacity
underutilization.
de Janvry et al.
(1993); AkwabiAmeyaw (1997)
Contract
and
collective
action
Tanzania • Perishability.
• Market
uncertainty.
• Easing bulking and transportation of
milk to processing plant.
• Ensuring adequate oversight on
milk quality and economies of size
during transportation, processing
and marketing.
• Group as platform to access other
business support services.
• Securing marketing.
• Stabilizing earnings.
• Establishment of
milk processing
plant.
• Governance
system involving
co-operatives.
4
• Difficulties in holding
management accountable to
members.
• Non-compliance with terms of
contract (side selling).
Kilima et al.
(2015)
Contract Rwanda
Price risk.
Hedging season low price during milk
flush season.
Established milk
collection centres.
10
Frequent milk rejection
http://www.
value-chains.org/
dyn/bds/docs/772/
SNVRwandaDairy.
pdf
(continued)