Collection Centers simplify marketing for smallholders

The marketing challenges of small farmers are enormous, and not only because of price fluctuations. iDE’s experiences in several countries revealed extremely high transaction costs to bring produce to the market. In Nepal, iDE has pioneered a concept of “collection centres”: groups of mostly female vegetable farmers have increased their yields drastically with small greenhouses and drip irrigation, which has led to high additional incomes, especially when the products are sold off-season.

Tomato and cucumber prices drop during the monsoon season, when everybody can produce them. During the dry season, vegetables are rare and fetch good prices, but they can only be produced with greenhouses and irrigation. When each farmer had to go to the market—often spending hours walking and then taking a bus—the transportation costs were high and cut into their profits. Similarly, if farmers sold through middlemen, they were unable to make as much profit. All this changed with the collection centres, which are a cooperation between groups of farmers to organize the marketing jointly.

Farmers bring their produce to the collection centre where the products are weighed, packed, sorted as per quality, and transported collectively in a small truck. This is beneficial for all—reducing transaction costs, improving quality, and increasing overall incomes.

Smallholder farmers can only take the step into modern farming if they are supported by a package of technical assistance (training, high quality seeds, fertilizer, pest management) on the one hand, but also with a certainty on the marketing side that they can sell their produce for a good price.