Agriculture & Microenterprise Development

Project Objective

The Kenya Business Development Services Program (Kenya BDS) is a 5-year micro- and small enterprise (MSE) development program funded by the United States Agency for International Development (USAID).  The objective of Kenya BDS is to increase growth and income among rural micro- and small-enterprises through increased access to business services.  The efforts of Kenya BDS focus on: 1) access to markets; and 2) access to business services to compete in those markets. 

Specifically, the program will select 3 subsectors of high growth potential MSEs, and identify market inefficiencies along the supply chain.  As critical constraints are identified, the program facilitates the delivery of appropriate business services to rural MSEs on a commercial basis. The program is flexible, and designs/introduces new interventions on an ongoing basis in response to changes in the market.  A significant component is the Market Intervention Fund that finances a combination of supply- and demand-side interventions, as well as information dissemination techniques to stimulate commercial transactions.  Through the Fund, tenders are competed among local business service providers and facilitators.  This maximizes the utilization of local resources and Kenyan expertise, and encourages market sustainability. 

Key Results

In 2003, the “Tree Fruits Sub-sector” was identified as the first of three subsectors for assistance by Kenya BDS, with a focus on avocado, passion, and mango fruit.  Based upon the geographical locations of the fruit, Program activities have focused in the Central, Eastern, and Coast Provinces.  Business services focused on: 1) Product assembly and grading services (supply contracts, forward and backward linkages, broker schemes); 2) Quality assurance services (production issues related to crop husbandry skills such as extension services, post-harvest handling, certification, Maximum Residues Limits (MRLs), traceability); 3) Access to material inputs (agro-chemicals and seed varieties); 4) Business skills (farming as a business); 5) Appropriate technology (irrigation and processing); 6) Establishment of a Kenyan label  (domestic and export); 7) Research and Development (R&D) (local adapted varieties, processing, and consumer preference for new products); and 8) Financial brokering (processing and smallholder levels).

Kenya BDS has also continued with pre-registration of local facilitators for the intervention fund, as well as tender release and award. To date, Kenya BDS has received 140 applications, and over 70 local facilitators have been pre-screened and registered with the Program.  Eight projects have been awarded to date under the market intervention Fund. These include a variety of activities related to developing groups of smallholder producers within high potential growth clusters, facilitating business linkages and embedded service flows between MSEs and lead firms, and building the capacity of commercial rural based service providers. Full descriptions of each individual tender award can be found at www.kenyabds.com.

Targets/Expected Results

The efforts of the Kenya BDS Program will result in increased market transactions, enhanced skills, greater information, and ultimately more competitive MSEs contributing to the formal economy in Kenya.  Specifically, by the end of Year Five, Kenya BDS is expected to achieve the following results:

- 80,000 MSEs Accessing Commercial Business Services
- 800 Business Service Providers participating in the BDS Program target areas
- 320,000 MSEs aware of Program-assisted business services
- 40,000 MSE producers linked with the commercial market

Future activities

Kenya BDS has recently identified Lake Victoria fish, with a focus on Nile Perch, Tilapia, and Dagaa as the second subsector for assistance.  Based upon subsector analysis and stakeholder vetting, business services to target will include: 1) savings mobilization services; 2) product assembly and market linkage services; 3)  quality assurance services ; 4) material input supply services; 5) business management training; 6) market information services; and 7) new product development. 

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