Making Markets More Inclusive: Lessons from CARE and the Future of Sustainability in Agricultural Value Chain Development

265 Pages·2014·2.43 MB·English

by  Kevin McKague

Advance Praise for Making Markets More Inclusive
“This is a rare book that makes the local relevant for the global by draw-
ing out lessons from CARE’s project work in Bangladesh’s dairy industry.
The result is highly relevant for other countries, sectors, and aid agencies.
McKague and Siddiquee achieve this through a flexible, pragmatic, and ulti-
mately satisfying application of value chain tools, from the presentation of
simple sector selection and mapping methods to drawing out key insights
from global value chain governance theory. The eyes are always on the prize:
achieving poverty alleviation and environmental sustainability by ‘interven-
ing to enhance women’s decision making power and control over assets or
otherwise change women’s roles and relationships in the value chain.’ There’s
much to be commended in this book!”
—Timothy J. Sturgeon, Author, The Governance of Global Value Chains;
Senior Research Affiliate, Industrial Performance Center,
Massachusetts Institute of Technology, USA
“With insight and clarity, Making Markets More Inclusive brings to life the
challenges, successes, and lessons learned from the complex but reward-
ing task of enhancing value chains for the benefit of smallholder farmers.
Required reading for anyone interested in market-based approaches to
development.”
—Tamara Abed, Senior Director, Social Enterprises,
BRAC
“There are relatively few value chain development publications that success-
fully combine a practical ‘how to’ approach with a strong conceptual under-
pinning and, perhaps most importantly, strong evidence for what works.
This synthesis of CARE’s work in Bangladesh, with its foundations in a
robust understanding of current thinking and best practice, is an important
contribution to the inclusive market development evidence base.”
—Christopher Coles, Author, Markets and Rural Poverty
“Making Markets More Inclusive shows how sustained support across the
range of value chain activities is essential in assisting poor producers to grasp
new market opportunities.”
—Raphael Kaplinsky, Author, A Handbook for Value Chain Research
“Strategies to increase the income of smallholder farmers are central to pov-
erty reduction. McKague and Siddiquee provide an in-depth case study of
CARE’s successful work in the dairy industry in Bangladesh. More impor-
tantly, they draw out lessons that will be useful for value chain development
for other agricultural products in any country.”
—Aneel Karnani, Author, Fighting Poverty Together;
Associate Professor of Strategy,
Ross School of Business, University of Michigan, USA
“Three critical themes for policymakers, donors, corporations, project imple-
menters, entrepreneurs, and farmers make this practical contribution to the
all-too-scarce literature of inclusive value chain development essential read-
ing: how to drive scale, how to engage stakeholders equitably across the
chain, and how to apply continuous learning to improve impact.”
—Simon Winter, Senior Vice President for Development, Technoserve
“Companies have enormous potential to fight poverty if the market systems
they share with the poor can be strengthened—a complex, daunting task
involving many stakeholders. By offering specific and replicable ‘how tos,’
this book fills a critical gap in the literature for all those willing to step up to
the leadership challenge.”
—Beth Jenkins, Insights Director, Business Fights Poverty
“Value chain is a widely used concept in the recent literature on agricul-
tural market development in developing countries. McKague and Siddiquee’s
analysis of dairy value chain development in Bangladesh will be particularly
useful to investors in markets and development agencies.”
—Mohammad Jabbar, former Senior Agricultural Economist,
International Livestock Research Institute
“Trade—whether within countries or global—is increasingly organized in
value chains. Linking up with the lead firms of such value chains is thus
very important for smallholders. At the same time, NGOs have an important
role in supporting inclusive value chains. Based on the experience of CARE,
McKague and Siddiquee provide new and very practical insights into the suc-
cess factors of agricultural value chain development.”
—Tilman Altenburg, Editor, Shaping Value Chains for Development
“This is a timely contribution to the literature on market and value chain
development, which provides unique and practical insights. It should feature
as a key reading for practitioners considering designing interventions in this
area.”
—Jodie Keane, Author,
A “New” Approach to Global Value Chain Analysis
Making Markets More Inclusive

Lessons from CARE and the Future of
Sustainability in Agricultural Value
Chain Development
Kevin McKague and
Muhammad Siddiquee
MAKING MARKETS MORE INCLUSIVE
Copyright © Kevin McKague and Muhammad Siddiquee, 2014.
Softcover reprint of the hardcover 1st edition 2014 978-1-137-38291-7
All rights reserved.
Although this book is based on a project funded in part by the
Bill & Melinda Gates Foundation, our findings and conclusions do not
necessarily reflect the positions or policies of the Foundation.
First published in 2014 by
PALGRAVE MACMILLAN®
in the United States— a division of St. Martin’s Press LLC,
175 Fifth Avenue, New York, NY 10010.
Where this book is distributed in the UK, Europe and the rest of the world,
this is by Palgrave Macmillan, a division of Macmillan Publishers Limited,
registered in England, company number 785998, of Houndmills,
Basingstoke, Hampshire RG21 6XS.
Palgrave Macmillan is the global academic imprint of the above companies
and has companies and representatives throughout the world.
Palgrave® and Macmillan® are registered trademarks in the United States,
the United Kingdom, Europe and other countries.
ISBN 978-1-349-48028-9 ISBN 978-1-137-37375-5 (eBook)
DOI 10.1057/9781137373755
Library of Congress Cataloging-in-Publication Data
McKague, Kevin, 1968–
Making markets more inclusive : lessons from CARE and the future of
sustainability in agricultural value chain development / Kevin McKague
and Muhammad Siddiquee.
pages cm
Includes bibliographical references and index.
1. Farms, Small—Economic aspects—Bangladesh. 2. Business
logistics—Bangladesh. 3. Agricultural development projects—
Bangladesh. I. Siddiquee, Muhammad, 1977– II. Title.
HD1476.B293M35 2014
338.1(cid:25)85492—dc23 2013050421
A catalogue record of the book is available from the British Library.
Design by Newgen Knowledge Works (P) Ltd., Chennai, India.
First edition: July 2014
10 9 8 7 6 5 4 3 2 1
Kevin: To Rebecca, Isaac, Miriam, and Bernadette
Siddiquee: To my mother Hena Akter, my wife Shirin, and my kids
Rusmir and Uzair
This page intentionally left blank
Contents

List of Illustrations ix
Acknowledgments xi
Prologue xv
Part I Making Value Chains More Inclusive
Chapter 1
Strengthening the Dairy Value Chain in Bangladesh 3
Chapter 2
Value Chain Development 17
Chapter 3
Value Chain Selection and Mapping 33
Chapter 4
Value Chain Intervention Strategies 47
Part II Five Key Objectives of Value
Chain Development
Chapter 5
Productivity and Producer Groups 59
Chapter 6
Increasing Access to Inputs 79
Chapter 7
Increasing Access to Markets 99
Chapter 8
Strengthening Value Chain Relationships 119
viii CONTENTS
Chapter 9
Improving the Enabling Environment 125
Part III Cross-Cutting Themes
Chapter 10
Gender 135
Chapter 11
Lead Firms 151
Chapter 12
Microfranchising 165
Chapter 13
Monitoring, Evaluation, and Learning 177
Chapter 14
Scale 193
Part IV The Future of Chain Development
Chapter 15
Moving Forward 203
Appendix: Quantitative and Qualitative
Data Sources and Analysis 211
Notes 215
References 231
Index 241
Illustrations

Figures
2.1 Five key objectives of value chain development 19
2.2 The creation and distribution of value 23
2.3 CARE’s desired outcomes 26
2.4 Value chain theory of change: objectives,
outputs, and outcomes 29
3.1 Spider web value chain selection tool 39
3.2 Value chain map of the Bangladeshi dairy value chain 42
4.1 The process of developing value chain interventions 52
5.1 M ap of the subdistrict of Mithapukur
in Rangpur district 63
5.2 Milk income by the maturity of the producer group 74
8.1 Horizontal and vertical value chain relationships 120
8.2 Types of value chain governance 123
10.1 Women’s empowerment framework 139
10.2 Decision making regarding purchase of cattle over time 148
12.1 Average monthly income of Krishi Utsho
dairy input shops 166
13.1 CARE’s measured dairy producer progress
(August 2008–April 2012) 179
14.1 Three routes to scaling market-based
approaches to poverty alleviation 194
15.1 Sustainable value chain interventions 207
Tables
3.1 Examples of identified and shortlisted value chains 38
5.1 P rocess of group formation, facilitation,
and training activities 70
5.2 Producer group categorization 74
10.1 The Women’s Empowerment in Agriculture Index 148