#Part 2: Cassava Value chain: How to create wealth for people of a nation in need of Economic Miracle : Logistics and supply chain management.

In continuation of "Cassava value chain: How to create wealth for people and a nation in need" in our #SundayspecialwithOlucassava series, I will like to welcome you to part 2 of the topic; Logistics and supply chain management: this part is very important to the cassava value chain. I will tagged any logistics and supply chain management as the "all important middle".

The cassava value chain involves multiple actors, including farmers, processors, traders, and retailers, it's the "all important middle" that connects all together. Supply chain companies are needed to coordinate their activities to ensure efficient production, processing, and distribution of cassava products.

Logistics and supply chain management in the cassava value chain can be divided into three main stages:

Procurement: This involves sourcing cassava from farmers and transporting it to processing plants. The procurement process involves identifying reliable farmers, middlemen, transport/logistics companies and negotiating prices, and ensuring timely delivery of cassava tubers.

In the procurement section of logistics and supply chain management, we have the "all important middle" . These are everything that go-in-between farmers and processors. This area of logistics is where we need real investment now.
The big middle that can provide liquidity in the entire value chain. This part will help make sure there is efficiency in the sector and reduce drudgery of the cassava production part.

The "all important middle" role will emcopass everything from sourcing of cassava tubers to having pickups/trailers to help mop-up cassava from different farms, and also ensure farmers are paid on the spot at farm gate. This make farmers meet his/her financial obligations and also help them plan the next planting season to increase productivity. The "all important middle" company will ensure processing companies operates at their effective efficiency which allow them to focus on their core business which is processing, while the middleman company take care of feedstock sourcing.

The "all important middle" will also be able to deal with each processor in collaboration with the banks thus they will form a tripartite arrangement in which the "all important middle" company can access financing on the strength of the processors credibility. The bank will help make sure monies earned by both processor and the "all important middle" company are disbursed according to terms thus providing liquidity in the sector. When Banks are not involved in this part of value chain, it makes makes wealth creation and value chain development a mirage. We need the banks to help in this aspect of value chain. The "all important middle" is the missing link in the value chain.



Processing: This stage involves transforming cassava into various products such as flour, starch, and chips. The processing stage requires careful planning and coordination to ensure that the processing plant has a steady supply of cassava and that the processing is done efficiently.

In the processing part of the logistics and supply chain management section. We still have to bring back the "all important middle". There is this story I'd like to tell people that care to listen, it's about one starch processor whom I use to supply cassava tubers. The company have capacity to process 13 trailers (30tons) of cassava tubers per day. But always struggle to see just 1 or 2 trailers per day because of the missing link of the "all important middle" . The processor cannot be sourcing and also be processing. It will reduce the efficiency of the processing and it will also not create wealth for everybody on the value chain. So imagine if the starch processor have sales and purchase agreement with the "all important middle" and their bank in a tripartite arrangement. The "all important middle" will always make sure at least 50 to 90% of the cassava tubers needed per day are met. And these will also encourage farmers to farm more as they are have guaranteed markets to sell cassava. It will also increase the economy of scale and make cassava tubers cheaper to produce.



Distribution: This stage involves transporting the processed cassava products to other factories that will need it to further process other goods. Whom also have another value chain entirely. But at then end, they will sell to consumers. The distribution process requires coordination between the cassava processing plant, other industrial users, traders, and retailers to ensure that the products are delivered on time and in the right condition.

Effective logistics and supply chain management in the cassava value chain can result in several benefits, including:

Improved efficiency and productivity: Efficient supply chain management can help to reduce wastes, drudgery, increase productivity, and improve profitability.

Increased market access: Reliable "all important middle" can help cassava producers to access new markets and expand their production base.

Improved quality: Effective logistics and supply chain management can help to ensure that cassava products are of high quality and meet the required standards. As the company operates at its effective efficiency thus maximizing its fixed costs of labor, electricity and other utilities that are fixed no matter their efficiency.

Reduced costs: Efficient "all important middle" can help to reduce transportation costs, storage costs, and other operational costs due to investment in light duty, mid duty and heavy duty trucks for the evacuation of cassava tubers from different farms simultaneously. This will result to improved profitability for all actors in the value chain.

In conclusion, "all important middle" companies are critical components of the cassava value chain. Effective companies operating in this sphere can help to improve efficiency, increase market access, improve quality, and reduce costs for everybody in the value chain of cassava.

In #part 3, we will take it further from here.



NB: you can read the #part 1here
https://www.nairaland.com/7628087/cassava-value-chain-how-create

Also you can read the other Sunday specials here

https://www.nairaland.com/7617637/k-factor-cassava-production

We can help handle planting and spraying of your cassava farms.

https://www.nairaland.com/3617291/cassavahubng-plant-cassava-spray-herbicides


And also we supply cassava stems and others, you can check this thread for more details


https://www.nairaland.com/3186506/cassavahubng-17-buy-original-hybrid

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#SundayspecialwithOlucassava

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