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Babban Gona’s Agri-Franchising Model: Scaling up Challenges

05 June 2018 | Cases | Agriculture

Abstract
Africa’s most populous country, Nigeria, is home to millions of smallholder farmers who, due to low economies of scale, have some of the lowest yields in the world, making subsistence farming unsustainable for them. This has led to large-scale unemployment, especially among the youth. Poverty, unemployment, and a rapidly growing population have made Nigeria a breeding ground for extremist organizations like the Boko Haram.
Kola Masha through his for-profit social enterprise, Babban Gona, is taking this challenge head-on by creating an innovative agricultural franchise model which provides professional management and investment for grass-root level farmer groups. Babban Gona’s holistic end-to-end service delivery model has resulted in farmers reducing their input costs, increasing their yields, realizing a higher price for their produce, and more than tripling their incomes. Babban Gona also embeds into its model, a risk mitigating model, which helps to reduce risks and increases the confidence of its financiers. The organization has the audacious vision of transforming the lives of 1 million farmers by 2025. But, does the model support such levels of scalability?
The case study brings out the challenges involved in setting up a social enterprise in agriculture and the scope of an agricultural franchise in the developing world. It underlines the need for and importance of a risk mitigating model that is constantly updated. The case allows students to analyze and debate the scope for scalability of Babban Gona and the additional risks and challenges it could face in realizing its vision.

Authors Manish Agarwal & D Satish
Institution ICFAI Business School Hyderabad, India
Competition Year 2018
Place Runner Up
Track Social Entrepreneurship
Key Words Agriculture, Smallholder farmers, Low economies of scale, Nigeria, Youth unemployment, Poverty, Agricultural Franchise model, Trust group, Risk mitigating model, Babban Gona
Courses Entrepreneurship, Social Entrepreneurship
Target Audience MBAs, MS level program
Permission rights This case will be published at the Case Centre shortly. You find an inspection copy for download below.
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