MSD Hub editor's note (Michael Field, Senior Systems Specialist, Vikāra Institute):
This blog highlights the importance of taking a systems-thinking lens from the start. With the goal of getting the market system to work in ways that allows vulnerable and marginalized populations to have fair and transparent opportunities to provide and capture value addition. For this to happen, the project cannot be the focus. The focus as to be on the local actors so that they determine that it is in their interest to engage disadvantaged population in ways that are fair and transparent. An additional insight from the blog is the importance of ongoing adaption and collaboration across projects. The Thrive Team in Honduras engaged ACDI/VOCA’s Transforming Market Systems project to share insights and experiences around working with local market actors as a way to improve Thrive’s capacity.
World Vision has been moving toward Market Systems Development (MSD) programming since the USAID and UK DFID joined efforts and USAID funded LEO project published A framework for inclusive market system development in 2014.
In 2018 World Vision engaged EcoVentures, now Vikāra Institute, to help World Vision move from Value Chain Development to inclusive Market Systems Development. As part of the effort, Vikāra Institute and World Vision developed the Market Systems Development toolkit.
In 2020 the MSD Toolkit was field tested in the World Vision Honduras Transforming Household Resilience in Vulnerable Environments (THRIVE) program. THRIVE is a privately funded World Vision Economic Empowerment program in 11 countries aiming at using Market System and other Integrated approaches to sustainably increase household resilience and income for the wellbeing of children. It specifically includes:
Inclusive MSD – Working with a hybrid approach that includes working with producers to better understand and connect to markets and directly with the private sector buyers and suppliers to better serve small producers especially extremely poor, female, women, youth and other vulnerable producers.
Savings for Transformation (S4T) Groups - Savings groups enable community members—often women—to gain basic financial knowledge, including how to save and pool their money, borrow money, pay back loans, and make financial decisions.
Finance Accelerating Savings group Transformation (FAST) - FAST loans to mature savings groups provide additional capital enabling members to take loans for business opportunities.
Empowered Worldview - This powerful curriculum is the foundation of THRIVE. It builds confidence, shifts mindsets, and promotes a biblically based view of identity, responsibility, and accountability.
This field testing included a five-day training from EcoVentures and coaching from the US office of World Vision.
As of 2023 The World Vision Honduras THRIVE project has supported 17,020 Hondurans living in rural areas of the country and our goal for 2030 is to reach 500,000 people through local agricultural businesses, agricultural technology, natural resource management, access to financial services and markets; this project targets farmers from vulnerable households who are generally below the poverty line. The project works with local small to large buyers, suppliers, and other affiliate market actors to provide services and inputs to the producers.
Speciality coffee producer Martin Sarmiento drying coffee seed
Evaluation
As the THRIVE external evaluator, Technical Assistance to Non-Governmental Organizations (TANGO) International conducted a baseline (March-October 2018), midterm (August 2021-February 2022) and endline evaluation (June-November 2023) to generate evidence on the performance and sustainable impacts made by the THRIVE intervention model in the Honduras project. Below are selected results of the project.
Income
The above chart illustrates how THRIVE households grew their median income from US$892 at baseline to $1,939.90 at endline. The median household income among THRIVE households was 44.7% higher than for non-THRIVE families ($1,340.30) at the endline.
The average household revenue from all value chain crops went up 22% in local currency. This is positive especially since COVID19 pandemic hit during this time frame.
Below is an excerpt from the main findings of the final evaluation as it relates to markets.
“At endline, THRIVE households received significantly higher (32.8%) farm gate prices as the result of sorting, grading and packaging compared to baseline (25.3%). Comparatively, less than 7% of control households report higher farm gate prices due to sorting, grading or packaging. While there has not been a significant change in THRIVE households' revenue generated from coffee or horticulture since baseline, THRIVE household mean revenue generated from beans has increased significantly from baseline (HNL 4,622) to endline (HNL 6,836).”
“THRIVE households also report significantly higher mean revenue than control households for both coffee and horticulture. Qualitative data indicates that THRIVE has made great efforts to raise producers’ awareness of the value of their crops, particularly with coffee producers. This has made a difference in how coffee producers are able to transform their production to better meet the demands of the market for higher value coffee.”
Some of the recommendations from the TANGO evaluation included:
“Good Practices to Scale - Continue to partner with national and regional market actors. The THRIVE project has made significant efforts, particularly since the time of the midterm, to identify specific market actors that could help the project meet its goal in shifting smallholders from dependence to actively participating in commercial markets. It is recommended that THRIVE Honduras continue partnerships with national market actors to ensure these positive results can be maximized in THRIVE 2.0.”
Some areas to strengthen included
“Conduct a robust market assessment in the design phase, before initiating activity roll out or partner identification.”
The final evaluation of THRIVE 1.0 provided validation of the interventions. It also provided recommendations to strengthen including understanding market actors through a more thorough market assessment.
Strengthening inclusive MSD
Strengthening the inclusive MSD component of THRIVE going forward is important to improve performance of the next iteration of THRIVE. World Vision Honduras is embarking on two projects with inclusive MSD. The THRIVE2030 project plans to reach 30,000 producers by September 2029. The expected impact is a 20 percent increase in income.
The second project THRIVE Plus has a goal to increase the competitiveness of more advanced producer groups to increase their income and generate employment opportunities with an emphasis on youth, women and people with disabilities. The target is to reach 5,000 producers by September 2029 and increase their sales by $10 million.
World Vision Honduras utilized a local consultant to conduct a thorough market assessment with a focus on identifying formal and informal sector buyers and suppliers for THRIVE to work with. Some of his observations included:
“Both groups require producers to be loyal and to deliver as agreed in order to maintain the commercial relationship and sustainability over time.”
‘There is a good opportunity with export buyers who offer contracts, to be explored as an alternative.”
Some of the consultant’s recommendations included:
“Advance in negotiations with exporters to run a pilot.”
“The selection of producer groups is very important for the success of the innovation projects, including producers with experience in crops and a record of being loyal, fulfilling their commitments and having had experience with World Vision.”
In 2024 World Vision enlisted an international MSD consultant to develop an internal online inclusive MSD course. To field test the course, a three-day training was conducted in August 2024 in Honduras with about 35 THRIVE staff focusing on “Working with Market Actors.” The purpose of the inclusive MSD workshop was to equip the staff from both projects to work with the private and public sector market actors to better serve the targeted producers and to work with the producers to organize themselves to better connect with suppliers, buyers, and other private and public market actors.
The workshop started with an overview of inclusive MSD followed by a presentation from staff of the ACDI/VOCA Transforming Market Systems (TMS) on how to connect producers with the buyers and suppliers. The groups then developed their plans to engage with market actors including buyers and suppliers.
Trainees developed plans for “Structuring and Managing Agreements with Market Actors” (pages 21-23). Trainees also developed draft Memorandums of Understanding with potential private sector partners. Following panels of output market buyers and input supply companies, trainees developed plans to “Working With Private Sector to Build a Community Agent Network.” (page 53) Below is a depiction of the community or village agent’s role. (page 49)
This will include “Selecting and Training Agents.” (page 18). Equipped with these tools, World Vision staff are developing annual workplans, to facilitate commercially sustainable relationships between producers with suppliers and buyers.
Conclusion
World Vision Honduras has been on a journey to engage with market actors to create market systems that are more inclusive for larger numbers of rural, poorer, female and youth producers.
With the positive outcomes in Honduras and other countries, the THRIVE program is expanding to scale to 11 countries its inclusive MSD and other interventions. The countries include Tanzania, Kenya, Uganda, Rwanda, Zambia, Malawi, Ghana, Senegal, Honduras, Guatemala and Vietnam. The THRIVE goal is, “by 2030, we will equip 10 million people with access to the tools they need to lift themselves out of extreme poverty.” THRIVE is funded by motivated private donors interested in economically empowering poorer households through market systems and other approaches.
Sweet potato producing family group. Sells in the local market and Walmart as a supplier.
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