Competitive Strategies for Agriculture-Related MSEs: From Seeds to Supermarket Shelves
This paper identifies opportunities for micro and small enterprises (MSEs) in agriculture and agribusiness, and explores strategic interventions for expanding opportunities. It describes major challenges threatening the future of developing country MSEs such as globalization and trade liberalization, increasing concentration of ownership by global agribusiness firms, heightened consumer awareness and international standards and advances in technology.
The paper presents a value chain framework for analysis. It analyzes the nature of opportunities for MSEs in different stages of agriculture and agribusiness value chains including input supply, production and marketing, post harvest activities and wholesale and retail efforts. Critical success factors for designing and implementing MSE-friendly competitive strategies include:
- Policy, regulatory and business environment;
- Vertical and horizontal linkages between firms operating at different levels of value chain;
- Innovations or improvements among a firm or group of firms;
- Supporting markets such as finance, business services, and information and communication technologies.
The paper recognizes the role of MSEs in diffusing benefits of growth throughout rural areas and to low-income households, and presents lessons from USAID and other donor interventions for support activities to MSEs.
