Bloom or bust? A global value chain approach to smallholder flower production in Kenya

Abstract

Purpose -Integrating smallholders into high-value global markets represents a unique opportunity to effect large-scale poverty reduction in the countryside. The purpose of the paper is to add empirical evidence to the discussion of how to best incorporate smallholders into the formal economy sustainably and responsibly. Design/methodology/approach -The paper first builds a theoretical framework around global value chain theory and literature on smallholder inclusion and Kenya's growing horticultural sector. It then moves to explore a Kenyan smallholder-based business model that incorporates 4,000 flower producers through an efficient and transparent intermediary. The analysis focuses on the importance of governance, upgrading and strong intermediaries for including smallholders in horticultural value chains. Findings -In conclusion, this paper finds that although smallholder inclusion is both favorable and feasible based on theory, literature and case study analysis, it remains limited. It proposes embracing innovative smallholder-based business models as a viable path out of poverty in countries with low labor costs, suitable climatic conditions and basic infrastructural capacities. Research limitations/implications -Limitations include a reliance on largely qualitative research methods due to gaps in available data. Practical implications -Policy implications include the necessity of promoting agricultural development through investments in extension services, the creation of research and development centers and improvements in the rule of law. Originality/value -This paper is unique in its focus on business models and global value chains as mechanisms through which to include smallholders into the global economy.

Multinationals and Modernisation of Domestic Value Chains in Africa: Case Studies from Ethiopia

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Can Indonesia Cocoa Farmers Get Benefit on Global Value Chain Inclusion? A Literature Review

“…Global Value Chain gives us an understanding on the nature of interaction between demand side and supply side in a specific sector and provides the analysis tool in developing intervention to include small farmers in the value chain (Zylberberg, 2013). We will use GVC perspective in identifying the opportunities for cocoa farmers to move up their value chain by producing a higher value of product and processes as well as an effective tool for farmer empowerment.…”

“…As smallholders tend to participate in buyer-driven value chains, the power asymmetries present in these trading relationships hamper possibilities for upgrading into higher value-added activities (Zylberberg, 2013), and shifting from market governance to more relational reduced the power asymmetries substantially but pushed the intermediaries on supply side to produce more from their own farms rather than purchased from small farmers (Gereffi et al, 2005). Itneed an innovative smallholder-based business model as a viable path out of poverty in countries with low labor costs, suitable climatic conditions and basic infrastructural capacities (Zylberberg, 2013).…”

Guides for value chain development: a comparative review

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