LAOS – Farmer Basket: Linking Producers with Consumers

The youth are the future of farming and food security. However, more and more young people from rural areas are choosing to move to urban centers to look for other employment outside the agriculture sector. Based on a study conducted by the Lao Farmer Network (LFN) on youth in agriculture, young farmers will continue tending to their family farms if they can make sufficient income from these. Thus, LFN has piloted several initiatives to support the youth to make a better income from agriculture. One of their successful initiatives is the ‘farmer basket’.

The Thongmang organic vegetable group—a group of about 40 smallholder farmers sells their vegetables in organic markets and in a shopping mall. However, they are not able to sell all their produce and the group also does not have sufficient labor because of the absence of youth members. LFN supported the group to expand its production to about 20 youth (12-19 years old) from the same village. The youth group purchases vegetables from Thongmang group and sells these through a new mechanism called ‘farmer basket’ which allows them to sell their vegetable produce directly to the consumers.

Farmer basket is a marketing approach that uses a Facebook page to sell organic produce directly to consumers. The system is managed by an organic vegetable producer group in Thongmang village, Sayseatha district, Vientiane, Laos.

“A box of vegetables includes six kinds of vegetables and one fruit—all grade A organic products from our garden. The vegetables differ every week,” explains Ae, a 14-year old member of the youth group. A box of vegetables costs around USD 7. According to Ae, the farmers that supply vegetables are well-trained in production techniques such as harvesting. “We give them a higher price because they select the best vegetables for us,” he says. Grade A vegetables are given 15-20% increase in price.

The youth market their baskets through face-to-face advertising and through Facebook. The following packages of products can be ordered by consumers:

• vegetable box (6 kinds of vegetable and 1 kind of fruit) = USD 7 per box
• selective order based on available vegetable per week= USD 7 up
• bamboo shoot soup= USD 8 per set
• Mekong fish dip set = USD 12 per set
• native chicken soup set = USD 10 per set
• mixed salad set = USD 7 per set

Farmers gain a profit of around USD 2 per box taking to account all expenses—buying the vegetables, the box, and transportation. Thirty percent of the sales are added to the savings fund, while the other 70% goes to the marketing team who purchases vegetables from the members, packs these into boxes, delivers the boxes, and also does the advertising.

In summary the innovations are: (i) use of social media (Facebook) for advertising the produce and communicating with consumers; (ii) promotion of products to offices in Vientiane capital to establish direct link with consumers, (iii) system is embedded as a marketing opportunity for the producer group.

Through this initiative, the Thongmang vegetable group can market their vegetable at a higher price. One box of vegetables gives about 30% profit. Moreover, consumers get high-quality products. And organic production of vegetables and fruits is promoted

Production capacity is limited. After a few month of advertising, the farmer basket became quite popular. For instance, some consumers would like to order 30 boxes of native chicken soup set, however, the Thongmang group does not have the capacity yet to supply that demand.
Quality control is not guaranteed. The group have difficulties in ensuring consistency when it comes to the supply of the best quality organic produce which leaves some consumers disappointed.
Initially, the group used paper boxes to package the vegetables. However, this way, the vegetables lose quality because they dry up and get rotten rather quickly due to the heat. Later on, the group used foam box with iced bottle to maintain a cool temperature inside the box. With this system, vegetables remain fresh over a day.
Transportation cost is high. Many consumers like to get the boxes delivered to their houses. But transporting a box of vegetable to the consumer does not make any profit. The system is working because the group embedded the system to the days that they come to sell their vegetables at organic markets (no additional transport cost); and only delivered at the market site or offices (where multiple boxes can be delivered at once).

• Production capacity is limited. After a few month of advertising, the farmer basket became quite popular. For instance, some consumers would like to order 30 boxes of native chicken soup set, however, the Thongmang group does not have the capacity yet to supply that demand.
• Quality control is not guaranteed. The group have difficulties in ensuring consistency when it comes to the supply of the best quality organic produce which leaves some consumers disappointed.
• Initially, the group used paper boxes to package the vegetables. However, this way, the vegetables lose quality because they dry up and get rotten rather quickly due to the heat. Later on, the group used foam box with iced bottle to maintain a cool temperature inside the box. With this system, vegetables remain fresh over a day.
• Transportation cost is high. Many consumers like to get the boxes delivered to their houses. But transporting a box of vegetable to the consumer does not make any profit. The system is working because the group embedded the system to the days that they come to sell their vegetables at organic markets (no additional transport cost); and only delivered at the market site or offices (where multiple boxes can be delivered at once).

Lessons Learned

• Need to build production, harvesting, packaging capacity, and ensure quality control for the producer group before advertising the product to ensure that consumers will not be disappointed.
• Facebook is an effective mechanism which is cheap to operate and accessible to consumers.
• Visiting offices to inform potential customers about the produce is important to establish links with consumers.

Recommendations

For the people who like to try this, it is recommended to start small at first. It is good to start with young people because they normally use mobile phones and social media such as Facebook. Secondly, it is important that the farmers group does not live too far from the potential customers.

The system was piloted in 2017 with Thongmang organic vegetable group and it is an ongoing initiative. LFN is set to provide more training on production and post-harvest techniques as well as marketing for the group.