Inclusive business models: Guidelines for improving linkages between producer groups and buyers of agricultural produce
These guidelines (PDF) by FAO have been developed to support the growth of inclusive business models (IBMs) that integrate smallholders into agricultural value chains. Small actors in agricultural value chains are tied to markets through a series of forward and backward business linkages, which incorporate various types of business models. The complexity of these business models varies according to the commodity, number of actors involved, local context and market structure. Aimed at designers of agricultural value chain projects, rural development projects and enterprise development projects, together with grassroots NGOs that implement smallholder commercialization projects, these guidelines have been developed to facilitate the design and implementation of interventions that strengthen business models linking smallholders to value chains. The methodology described has been pilot tested across Africa, the Caribbean and the Pacific with support from the European Union (EU) and the Government of Ireland and is accompanied by guidance tips, principles and criteria based on experiences during its implementation. Findings are categorized according to crop types, cash, high-value and food staple crops – which provide an additional source of guidance useful in the design, planning and implementation phases. A FAO policy brief further complements these guidelines, describing how the public sector can contribute to both the inclusive and competitive goals of inclusive business models. An important contribution of this publication to existing literature on agricultural value chains is the guidance it provides on designing business model strategies that do not only link smallholders to markets, but that also encourage practitioners to consider the quality of market inclusion and its impact on poverty reduction.