According to a report by Rabobank, farmers must demonstrate rural entrepreneurship as supply chains are becoming increasingly difficult to manage.An uneasy trading environment adds to the complexity. One resolution would be an increase in sharing of risk and reward.
“Many supply chains can be characterised as a tug-of-war between one end and the other. The answer is to move forward in dedicated supply chains based on the principles of using less, doing more to maximise value at each stage, managing resource flows and working together. Essentially it means co-operation, not isolation,” explains Justin Sherrard, author of Winning Through the Supply Chain.
Australian farmer Lachlan Seears has sought to develop better relationships with the processors and marketers further along his supply chain. By setting up a Facebook page, he’s been able to promote and show processors and marketers some of the best practices he’s adopted.
“If you are able to better understand your supply chain from production through processing, all the way to consumption, you will have a greater appreciation and understanding of what is required and what the costs involved are for downstream chain partners. In this way the company helps to close the gap between the farmer in the country and the end consumer in the city,” says Seears.
Some other ways of getting to the top of the supply chain:
- Cost efficiency: Focus on increasing scale and producing agricultural bulk goods (especially relevant for large farms).
- Consolidation and concentration: This will work well for farmers who have joined forces as they’ll have more resources to invest in productivity growth and increase profitability.
- Innovate: Find ways for improvement by assessing your business and processes regularly; keep up to date with the latest agri trends and liaise with your peers to learn about their best practices.
- Reconnect: Share your story and passion and demonstrate your skills.