SAP Makes ‘Living Lab’ For Cashew Farmers In Ghana

Around 40 percent of the world’s cashew nut harvest comes from Africa, but problems in supply chain management mean that African farmers rarely reap the benefits. Although collaborative relationships exist between small farmers and buyers or traders, business transactions are often inefficient and lack transparency.

However, the African Cashew initiative (ACi), co-funded by the Bill & Melinda Gates Foundation and German development organisation GIZ, aims to give people in the cashew business direct access to modern technology, enabling them to increase their yields, improve business links and develop advanced marketing strategies.

ACi has partnered with software vendor SAP to develop mobile applications for smallholder cashew farmers, organised into co-operatives, that enable logistical co-ordination, bulk selling, and access to market information. According to SAP, these applications not only boost local economic activity but have the potential to improve the socio-economic situation of a vast number of under-served rural inhabitants.

Wenchi ‘Living Lab’

A so-called “Living Lab” has been established at the Wenchi Cashew Union in Brong Ahafo, Ghana. Until now, records of the quantity of cashews supplied to retail cooperatives by each farmer were kept manually. The new software means that sacks of cashews can be scanned with a smartphone and the weight recorded on the phone under the details of the farmer supplying the cashews.

Farmers are given a receipt at the end of each season, showing how many sacks of nuts they have sold and at what price. This not only allows them to keep records but helps to build trust, by providing traceability in the supply chain between smallholder farmers, manufacturing companies and wholesale traders.

SAP’s smartphone applications also keep buyers informed about cashew sales and changes in price levels, meaning that farmers no longer have to accept any price they are offered. Buyers can show the updated market price to farmers on their smartphone before buying the sacks, so that they are guaranteed to be paying the right price for that day.

“Transactional data is what this is all about,” said Carsten Friedland, SAP researcher in technologies for emerging economies, who is helping to implement the smartphone pilot in Wenchi. “Before, farmers thought the zonal secretaries were cheating them. There was no control; there was no system. Our aim is not to generate transactions from this tool but to visualise transactions.”

SAP has also developed a geographical information system for use by the union’s secretary, which displays farmer contact data, farm size and location, as well as tree inventory and price information. This enables the union to forecast and optimise cashew collection, as well as allowing each cashew sack to be traced back to its original producer.

The first live pilot of the software system was conducted during Ghana’s cashew season from March to June 2011. About 400 farmers in five participating buying stations registered, and more than 100 tonnes of raw cashew nuts were traded via the system.

“At first, we faced many problems,” said Peter Amponsah, who works at the Jema buying station in Wenchi. “We put down records in a book, but the book can get lost. The mobile phone gives us information in our business. It has let our accountability become very easy, and also helps us with traceability.”

“The minute they finish buying, the data comes straight to the union office,” said Yahyi Baro, secretary of the Cashew Union. “I will always know how many bags are in the store before I get there, and not even a peshwa is lost.”

SAP hopes to expand the programme to more cashew buying stations around Africa, as well as developing solutions for other products such as coffee and cocoa.

Shea nut farmers improve efficiency

The ACi project mirrors a similar initiative supported by SAP, designed to improve the incomes and living conditions of women Shea nut harvesters in the north-east of Ghana. Together with non-profit NGO PlaNet Finance, SAP has helped to set up the Star Shea Network (SSN) – a national organisation of more than 3,000 women, which provides training in improved production techniques and business management, as well as offering microfinance opportunities to the associated groups.

SAP has developed a mobile application called Rural Sourcing Management, which uses barcodes to match up each sack of Shea nuts with the woman who collected them. The barcode can be scanned using a smartphone at the point of purchase, ensuring that each individual’s contribution to the cooperative is logged.

Meanwhile, at the far end of the chain, SAP’s Market Connection software package collects and processes orders from buyers over the Internet. Details are sent back through the system and recorded by the software, allowing buyers to track the product’s progress through the supply chain. This transparency element is now a key requirement for many export markets.

“We believe in technology as a main driving force to create opportunities and connect that global value chain at the bottom of the pyramid,” said SAP research and development worker Soo Shim.