Answer: Service delivery Model taken as a case study of Bank of Central Bank of Nigeria and SMEs in Nigeria(Famers)
Explanation: Service delivery models (SDMs) are supply chain structures which provide services such as training, access to inputs and financing to farmers to increase their performance and sustainability. The image below shows the roles of different entities in an SDM, although this can differ between the cases. The provider of the services is often the same entity that also sources crops from the farmer.
Modern agribusiness in developed economies is characterized by professional service delivery to the farmer supply base. In developing and emerging economies, this is a different picture; the market is less robust and public structures for service delivery are often non-existing or not well functioning. In this context, processors, traders and other originators of agri-commodities have started to develop services for their supplying farmers. This extension of company operations beyond the immediate core business is relatively recent and therefore still in search of best practice and cost-effectiveness. Many service models are not sustainable yet, as smallholder farmers are still left without access to the services they need. Approach
The focus of our analysis has been on the return on investment at three different levels of service delivery: the (value chain) investor, the service provider and the farmer. These three levels have been chosen because a sustainable model requires that all three main actors of the model receive a return on their investment. At each level, the costs and benefits of using and offering services were collected to calculate the return on investment.
Different scenario’s were designed to gain insight into the key drivers for costs and benefits for farmers and service providers. To be able to benchmark different cases, a period of 8 years for each case was used, although some of the cases were operating for a shorter or longer time period. The analysis did not calculate the social return (e.g. community benefits) or environmental return (e.g. soil quality improvements or water usage reductions) because there is little quantitative data to support such analysis. Also, as most of the service providers are working with sustainability standards that are geared towards measuring social and environmental impact, we expect that certain social and environmental criteria are already being addressed.
