1. OSPRO
Wikifarming and Open Source Processing The Organic + Fairtrade Experience 2.0
Ashifi Gogo, Evans Lartey, Bright Simons Center for Humane Education, Ghana.
GSEC 2007

2. The opportunity & WOSPRO’s vision Organic farming, certification
Agenda
The opportunity & WOSPRO’s vision
Organic farming, certification
Ghana-UK trade: ideal starting point
Revenue model
Timelines
Social impact
The team

3. Source: Packaged Facts report – projections for 2005
The Opportunity
EU Organic market: $10 billion, massive growth.
UK imports 75% organic.
Suppliers (farmers) in developing countries, like Ghana.
Rigorous organic certification procedure
too complicated (illiteracy).
Source: Packaged Facts report – projections for 2005

4. Fairtrade + Organic food consultancy, consolidator and exporter.
WOSPRO’s Vision
Fairtrade + Organic food consultancy, consolidator and exporter.
Social impact:
Farmers (Fairtrade).
Environment (Organic).
$1.1 mil profit in 5 years with $0.5 mil investment.
1400 farmers: 3X net income increase.

5. Organic Farming Organic alone: 40%. Fairtrade alone: 45%.
Organic: good environmental practices.
Low pesticides: Cancer & allergy fears.
Low fertilisers: Environmental good.
Natural growth: Great taste.
Community building: Social issues.
Fairtrade: pay farmer fairly.
High price premiums:
Organic alone: 40%.
Fairtrade alone: 45%.
Combined: 55%.
Sources: Wikipedia, Fairtrade Organization

6. How Do I Get Into The Market?
You need a Certifier.
Monitors organic standards.
Issues certificate permitting organic sales.
Soil Association certifies 75% of UK organic produce.
Source: Soil Association

7. Politically stable: 25 years Fully democratic, past 15 years
Ghana
Politically stable: 25 years
Fully democratic, past 15 years
Free press & rule of law.
2006 Inflation rate: 10.5%.
Established UK trade links.
Agriculture: 40% of GDP.
Employs 60-70% workforce.
Sources: Wikipedia.org, CIA World Fact Book Websites, Ghana Statistical Service

8. Typical Ghanaian Farmer
Grows organically by default.
Precedent for cooperative farming.
Low scientific sophistication.
No organic certification.
Costs $1200/day for inspection.
Average yield.
Low to medium net income
$500 a year.
Handles product distribution.

9. WOSPRO’s Solutions
Guidance through UK organic certification
Virtual proximity organic education
VIRPROX: Cost saver
Long term: certification costs fall from $1200/day to $120/day
WOSPRO purchases directly from farmer at fair price
Organic AND Fairtrade
WOSPRO exports products to UK
WOSPRO: Organic food consultant + consolidator + exporter = supply chain facilitator

10. Ghanaian Certified Organic Farmer Existing Food Exporter
Revenue Model
Ghanaian Certified Organic Farmer
UK Distributor (more info in Q&A)
Existing Food Exporter
US / Global Distributor
West African Certified Organic Farmer
Long Term
50kg peanuts: $12
With WOSPRO: $36
No organic, no Fairtrade: $54
Fairtrade+organic sale: $78
Source: Fairtrade organization, NAFED
45%
Hauling cost: $30
Profit: $12
Put in concrete numbers here for the purchase and sale.
Year 1
Year 2
Year 3
Year 4
Year 5
Sales Turnover (‘000 US$)
400
900
1,200
2,100
4,000
Profit (‘000 US$)
-450
-247.5
52.5
525
1,100
Bottoms up approach, conservative estimates. Available in Q&A.

11. Break Even Analysis EU Market Entry Market size: $105 mil.
Break-even sales = $1,547,500.
Market growth:15% per annum.
Inflation, interest rates will not exceed 30% per year.
Bottoms up approach, more info in Q&A.

12. Large SROI value of 3 Social Impact $1 invested = $3
Fairtrade  farmer’s income increases from $500 to $1600 over 3 years.
Environmental and health gains.
Direct and indirect job creation.
Stem rural  urban youth drift.
Eco & food tourism.

13. Project Timeline Organic subcert. from UK company
Storage facilities, farmer recruit, transportation logistics
Export & dist. outlet finalized
Funding: $150,000
First batch of crops shipped
More farmers
Expand distribution
Diversify crop selection
Funding (IFC): $350,000
Expand to EU, starting with Netherlands
Grow to primary West African Certifier
Long term growth / exit strategy
2007
2008
2009
2010

14. Management Team Evans Lartey Graduate, L’Ecole De Management in Paris.
Founder and CEO of PIU, investment consultancy in Accra
Top agric graduate; food security expert, USAID Title II Project.
Bright B. Simons
2005 Marie Curie Fellow (EU Migration Centre, Berlin), Journalist.
Human Development Analyst. Researcher into organic issues.
Paa Kwesi Imbeah
Yale University graduate and Gordon Grand Fellow.
Founder, Kasahorow project: translation effort for African languages.
Localized farming education materials and efforts.
Ashifi Gogo
Electrical Engineering Ph. D. candidate, Thayer School, Dartmouth.
Computer consulting, online social networks. VIRPROX.
Active search: CFO, CEO

15. Advisory Board
Elsa Garmire: Professor, Dartmouth. Tech. transfer expert
Member, National Academy of Science, Fellow, Optical Society of America, IEEE.
Nancy Garrison: Organic food expert
leading member, Slow Food Movement, arguably the world’s largest organic consumers’ association
John Jeavons Project: organic farming education
Arpit Rai: High tech social entrepreneurship
Exec. Dir., ASES Singapore
Business Development Executive, technology consulting giant Satyam.
Gregg Fairbrothers: Director, Dartmouth Entrepreneurial Network
Startup launching maestro
Claude Fussler: Sustainable development expert
Former Director of the World Business Council for Sustainable Development
Nick Hewison: UK crops market expert
MD, NDH Management Services & Consulting, commercial fruit grower in Devon, UK

16. OSPRO

17. Marketing & Sales Strategy
OSPRO
Questions & Answers
Agriculture
VIRPROX
Ghana
Market Research
Certification
Distribution
Value Proposition
SROI
SWOT
Exit Strategy
Exit Strategy
Fairtrade
Competition
Marketing & Sales Strategy
Feasibility Studies
Scalability

18. Short term: unprocessed food supplier Med. term: extracts
Sales Strategy
Short term: unprocessed food supplier
Med. term: extracts
Long term: WOSPRO branded food

19. Short term: Existing UK importers Long term: Market goods to consumers
Marketing
Short term: Existing UK importers
Looking for supply
Long term: Market goods to consumers
VIRPROX
Secured market

20. Increase product basket diversity VIRPROX
Scalability
Expand farmer base
West African Certifier
Increase product basket diversity
VIRPROX

21. Distribution: Timeline
Fairtrade Ventures
Expand to include:
Utopia
New Covent Garden Trade
Cumbria Organics
Supermarkets & caterers for in-house brand
Waitrose
Co-op
Organic Restaurant
Bistro Organic
WOSPRO’s own label:
Asda
Tesco
Sainsbury
Cafeterias in universities, offices etc.
Expand to USA:
Whole Earth
Amy’s Kitchen
2007
2008
2009
2010
2011
2012

22. Growth: Timeline
Year 1 – [Months 1-6]: Pilot Project: 26 farmers, Crops: Peanuts, Peppers. VIRPROX trial run.
[Months 6-12]: Launch: 50 farmers; Organic certification license obtained; first order through Fair Trade Ventures. VIRPROX goes live – Soil Association MOU on VIRPROX concluded.
Year 2 – [Months 1-3]: 150 farmers. Fairtrade Certification obtained. New farming units admitted per sales dynamics. Ginger added. Districts in Eastern Region of Ghana come on-stream.
Year 3 – WOSPRO labelling on products. First retail order secured. First batch of products reach Netherlands. Shea nuts and Cola nuts added. Districts towards Northern Ghana come on-stream.
Year 4 – Derivative processing begins in Free Zones’ site – sub-contractor plant: shea butter, cola juice, pepper pastes, peanut butter and ginger extracts. Factory orders for processed produce begin. Explore prospects of USA entry.
Year 5 – Enter US Market. Acquire license. Begin exploring bulk demand.

23. (Each farming family has about 5 workers)
Growth: Details
Year
Projects
Crops Involved
# of Farmers
Output
A. Total tonnage
B. US$ ‘000
0 (pre-launch)
Feasibility Studies.
Pre-inspection consultations with SACL.
VIRPROX prototype completed + simulations.
MOU with SACL about VIRPROX.
Staff recruitment & training.
Identify farming districts. 1
Recruit farmers
Organic certification license.
First orders from Fairtrade Ventures.
Silos completed.
Peanuts
Peppers
(Each farming family has about 5 workers)
300
A. 418
B. 400 2
Fairtrade license obtained.
More farmers recruited, new districts added.
Negotiations with more third-party buyers.
Factory and feedmill orders begin.
First direct orders from retail chains begin.
Above + Ginger
Lime
450
A. 815
B. 900

24. Growth: Details Continued
Year
Projects
Crops Involved
# of Farmers
Output
A. Combined tonnage
B. US$ ‘000 3
More retail & factory orders.
Re-negotiating third-party distribution; focus on direct orders.
Dutch orders.
Brand-packaging of produce begins;’’ free zones concessions’’.
Lease on warehouse.
Ginger
Lime
Peanuts
Pepper
Shea nut
600
A: 1315
B: 1200 4
Processing of product derivatives.
Warehouse leased near Tema port.
Shelf-space in supermarkets for processed and packaged produce.
U.S. Fairtrade and Organic license obtained.
same
750
A: 1900
B: 2100 5
U. S. market.
Warehouse leases in Netherlands.
Shelf-space in Netherlands, Switzerland and Germany.
1400
A: 3100
B: 4,000
Long-term
West African certification agent
Additional commercial applications of VIRPROX.
Evaluate market & add new crops

25. Fairtrade: Sales & Growth
Purchase farm produce at fair prices from farmers in developing nations
North American & Pacific Rim growth:
2003 Total Sales US$ million, a 52% increase over 2002
2004 Total Est. Sales of $ million.
Source: fairtradefederation.org, Wikipedia.org

26. Fairtrade: Premiums
45% Premium

27. Market: Organic + Fairtrade International Premiums
Produce
Country Of Origin
Fairtrade & Organic
minimum
Price per MT (US$)
Premium per Metric Ton (US$)
Premium %
Peanuts
China
1100
450 41
Ginger
India
950
160 17
Shea nuts
Uganda
400
130 33
Shea butter
Senegal
1400
420 30
Peppers
Egypt
855
250 29
Limes
Brazil
1700
300 18
Lemon
Peru
190 60 32
Mango
214 55 26
Orange
204 80 39
Pineapple
240 90 38
Source: Fairtrade Standards For Fresh Fruit and Fresh Vegetables For Small Farmers’ Organizations. May 2006.

28. Market: Example Product Basket
Crop
Uses (processed organic end products)
Some Targeted Buyers (UK)
2006 Market
Size (US$ million)
Peanuts
Raw peanuts, peanut butter, livestock feed
Asda, Tesco, BOPC Paul Organic Livestock farms, Utopia 25
Limes
Baking additive, lime juice
Asda, Morrison, Tesco, Robinsons, Utopia 40
Ginger
Gingerbreads, ginger spices, ginger ale, ginger beer
Green & Black (chocolate makers), Steinbecks (organic products), ARP, Cauldron 15
Peppers
Spices, Ground pepper (Caribbean style), meat condiments
Organic restaurant, Tesco, Asda, KFC (pitch), McDonalds (organic range), ARP, Cauldron 12
Shea nuts
Wide range of cosmetics, ectopic medication (eczema), shea butter, oils
BodyShop, Tesco, Asda, Duchy Organics, Ecomat 13
High growth, not peaking soon.

29. Market: U. S. Organic Sales
2005: $15 Billion
Source: Southern Organic Resource Guide

30. VIRPROX: WOSPRO’s logistics and resources management system.
VIRPROX: Details
VIRPROX: WOSPRO’s logistics and resources management system.
Unlike SAP 6.0. Optimised for audiovisual interfacing
Existing systems: NIP’s OTS, but require IT trained farmers.
VIRPROX is simple and functional.

31. Portal for communicating with certifier audiovisually.
VIRPROX: Web Portal
Portal for communicating with certifier audiovisually.
Inventory orders, batch control via portal.
WOSPRO field activities video-transcribed into system.
Learning material for extension officer trainees.

32. VIRPROX: Practical Scenarios
Training:
Record SACL training sessions, upload to VIRPROX.
New extension officers recruited: retrain with VIRPROX multimedia.
No need for SACL
Need to educate semi-literate farmer: use VIRPROX multimedia, translated to local languages.
No need for high literacy.
WOSPRO faces new farming challenges
Capture multimedia, upload to VIRPROX, notify SACL
SACL solves problem remotely. Saves $$$.
Better than , phone, air mail.
Supply Chain:
Keep track of product batches with codes in VIRPROX
Problem arises: traceback with VIRPROX
VIRPROX: Powerful tool for data keeping, auditing, disaster prevention, training and post-crisis learning.

33. Mock-up of a VIRPROX-powered portal plane.
VIRPROX: Schematic
Mock-up of a VIRPROX-powered portal plane.

34. VIRPROX: Capital Disbursement
Schedule of Costs
Amount (US$)
Software code development (VIRPROX)
40,000
Market research, pre-revenue overheads, hiring
10,000
Certification and incorporation of division
2,000
Wireless infrastructure
8,000
Data centre and network services
5,000
office space and outfitting
15,000
Patents and copyrights
Legal miscellaneous
3,000
Operations
Human Resource Development
30,000
Total
120,000
Premises and Assumptions
Interest rates differ for IFC loan facility and venture finance.
Venture finance package is an optimal mix of debt and equity.
In year two, WOSPRO shall qualify for the fair-trade concessionary financing scheme under the Shared Interest program.

35. Fairtrade AND Organic products  UK.
WOSPRO Services
Fairtrade AND Organic products  UK.
Developing skills and knowledge for organic farming in Ghana.
Scoping and feasibility studies, aid decision makers.
Training extension officers from Kwadaso Agric University, Ghana.
Training in organic certification.
Market development and supply chain mapping.

36. Operations Peanuts, shea nuts, lime, ginger and pepper plant farmers.
Exclusive agreement to supply WOSPRO
Microfinance (local bank)
Locally produced farming implements
Certification guidance
Initial: WOSPRO bears certification cost (SACL core processes). Medium to long term: Farmer bears VIRPROX subsidized cost. 20% annual earnings servicing debt. Paid in 5 years.
Local carting company: fully refrigerated transportation and storage silos.
Existing freight forwarders: export to UK warehouse.
Medium to long term: WOSPRO packaging, labeling facility at Port of Tema, Ghana.
“Ghana Free Zones Scheme”: Over 70% output for export  reduced tax burden by over 85 %.
Support under EU’s Everything But Arms Initiative.

37. Ongoing Feasibility Studies: Farming
Districts in Ghana:
Ejisu-Juaben
Bosomtwe Atwima Kwanhuma
Kwabre
Ethnographic study of 14 farming families ongoing

38. Ongoing Feasibility Studies: Business
Partnerships at local and International Level
IFC (International Finance Corporation) considering application under S&ME Fund scheme
IFAD (International Fund for Agricultural Development) studying proposal
District Directorate of Agriculture in Ejisu-Juaben
Kwadaso Agricultural College:
recruit extension officers
provide top-up organic course using VIRPROX platform.

39. Strengths, Weaknesses, Opportunities, Threats.
WOSPRO: SWOT
Strengths, Weaknesses, Opportunities, Threats.
Strengths
Weaknesses
Leadership Advisory Board
Matching funds
Ghana stability
High food miles
Needs good marketing
Opportunities
Threats
Access to big marketing infrastructure
(fairtrade & activism)
Booming market – right positioning
Ghanaian agriculture
New market
Big food
Environmental changes

40. Strengths WOSPRO: SWOT
Vice President: Evans is Director of Devt., IMANI
International award-winning think tank
links to major corporate bodies in Ghana.
IFC funding possibility
IFAD support possibility
Advisory board
Ghana stability

41. WOSPRO: SWOT
Weaknesses
High food miles
Needs efficient marketing

42. Opportunities WOSPRO: SWOT
Access to marketing resources through Fairtrade and environmental activism movements.
Growing society support for organic and Fairtrade.
Booming industry, being in the right niche at the right time could bring millions of dollars.
Organic by default farming in Ghana

43. Agriculture is natural cycle dependent
WOSPRO: SWOT
Threats
Agriculture is natural cycle dependent
New industry – trends can be fickle
Produce buying in EU/US: tilted in favour of big food
less bargaining power for suppliers

44. Cash crop growing system
Competition: Ghana
Cash crop growing system
Cocoa, coffee, pineapples.
Large export income earnings.
Great Government support (agric specialists).
Specialized marketing/distribution companies.

45. Competition: Global India. Competing crops: ginger, pepper.
Duplication of cooperative model.
Existing EU/US perishables trade ties.
Comparatively lower commercial farming.
Low earning power in agriculture sector.
India. Competing crops: ginger, pepper. 
Problems: low consolidation, technical inefficiencies, market links, entrepreneurship and networking
Only 23% of major European importers source from India.
Source: FIBL Research Institute of Organic Agriculture Report Organic Agriculture in India
International Competence Centre for Organic Agriculture ICCOA
Report of the Need Assessment of Indian Organic Agriculture, January 06, 2004
Summary: “The Indian Organic Market [is] suffering from the incertitude about the potential market, lack of successful pioneers and courageous imitators […].”

46. Competition: Global Sri Lanka. Competing crops: Lime, pepper
A 24-year old civil war: Hindu Tamils and the majority Buddhist Sinhalese. 
Logistics/export nightmare.
Uganda & East/Central Africa
Greater emphasis on Cash crop farming & commercialisation of agriculture.
Only political semi-stable: Uganda, Congo and Zimbabwe.
Higher freight costs to Europe.
Shea nuts: grown in West Africa.

47. Competition: Long Term
Organic Brand
Advantage
Limitation/Risk
Mitigation
WOSPRO
Fairtrade logo. Organic logo.
VIRPROX enhances product integrity for supermarket and other buyers.
Low production costs.
Distributed produce supply base implies low risk of disruptions.
High ‘food miles’
Limited marketing resources to explain all value propositions.
No shelf space advantage.
Web portal compensates for lack of marketing clout.
Access to media agenda of development and social justice advocacy groups.
Web-portal provides means for organic-related needs to be clarified and met for added value to customer.
Local/
Independent
‘Comprehensively’ organic – no food miles issues.
Strong ‘local sentiment’ which influences patronage; customer can support farmer directly.
Freshness guaranteed.
Poor ‘reach’ (typically sell through ‘open markets’ which have limited scope.)
Low economies of scale/high production costs may lead to higher than industry-average prices.
No ‘Fairtrade’ opportunity.
Low range – limited to local crop varieties.
Local producers’ cooperatives can resolve some ‘economies’ issues.
Strong patron bonding may lead to some customers overlooking price.
Big Food
(E.g. Kelloggs’ Kashi and Weetabix ‘Organic’ ranges)
Massive marketing clout.
Easy access to supermarket shelves
High Brand recognition.
‘Footfall drive’ – loyalty to brand’s non-organic lines can generate interest for ‘organic’ versions.
Most brand images incompatible with ‘organic’ ideal e.g. fall in Kashi’s sales upon acquisition by Kelloggs.
Fairtrade/organic seals harder to acquire due to Certifier resistance.
Enough muscle to influence customer perception through media lobbying.
Can acquire ready-made organic brands for attempted integration into brand ethos.
Exclusive
Organic Brands
(e.g. Jordans, Dove, Whole Earth, Whole Foods, Prince Charles’ Duchy Organics)
Considerable marketing clout.
Favorable access to shelf space.
High Customer trust.
Fairtrade/organic certification advantages clear and growing.
No ‘proximity’ advantage.
No significant cost advantages.
May pose biggest competition to WOSPRO.
Some like are involved in well-publicized conservation efforts.
Customer bonding may thus proceed vicariously
Supermarket
In-House Brands
(private labels)
Formidable shelf prominence.
Marketing instrument (in-store promotion) highly effective.
Superior grasp of customer shopping behavioral trends.
Brand compatibility with organic ideal is weak.
No cost advantages.
Low Fairtrade/organic certification advantages.
Anti-supermarket sentiment may rub off.
Sourcing locally, though expensive, may enhance proximity.
Can easily source from third parties for repackaging as brand recognition is assured.
New Entrants
(Ghanaian producers competing with WOSPRO)
Lower production costs.
No short of potential members for producer cooperatives.
Organic and Fairtrade certification advantages.
Patent cover prevents adoption of ‘web-oversight’ marketing technique.
Certification presents significant managerial and technical challenges.
Sound knowledge of European (western) consumer trends required.
Alternative technologies that may be in the pipeline elsewhere may enhance proximity.
WOSPRO’s Contractual holds on managers, freight handlers, producers etc. can never be impregnable.

48. Ghana: Country Profile
Capital (and largest city): Accra
Official language: English
Government: Constitutional republic
President of Ghana: John Agyekum Kufuor 
Independence from the UK
Declared : 6 March 1957  
Republic: 1 July 1960
Constitution: 28 April 1992 
Area: 238,534 km² or 92,098 sq mi (about the size of Oregon).
Water 3.5% of the area
Population: 22 million (2005 estimate)
Density: 93/km² or 215/sq mi
GDP (PPP) 2005 estimate: Total $55.2 billion , Per capita: US$2,643 
HDI  (2004): 0.532 (medium)
Source:

49. Ghana: Country Profile: Economic
Standard & Poor country rating (2006) : B+ (Best in West Africa)
United Nations International Development Organization ranks Ghana ‘’Best for Investors’’ in Africa 2007.
World Bank: Doing Business Report 2007 – Ghana: Top Reformer in Africa.
Ghana: highest grant award from US Millennium Challenge Account
good governance, rule of law and democratic accountability.
Cedi: full entry into international exchange rate mechanisms (2006)
High scores: NEPAD African Peers’ Review Mechanism.
Freedom House Investment Climate: Excellent

50. Ghana: Country Profile: Social
Amnesty International Human Rights: Good
US State Department Political Climate: Very Good
Socio-Political Information/Institutional Environment
No national-level ethnic unrest in 50 years of independence
No political prisoners
New Commercial fast-track courts to remove bureaucracy from the commercial judicial system.

51. Ghana: Country Profile: Investment
Tax breaks for foreign investors.
New Partnership for African Development (NEPAD).
African monitoring of good governance, accountability
Ghana Investment Promotion Act (1994)
tax concessions for up to 10 years are available.
Low inflation rate (graph on next slide)

52. Ghana: Country Profile: Inflation
Source: Bank of Ghana

53. Ghana: HDI
Human Development Index (HDI): life expectancy, literacy, education
Ghana
China, India
██ high
██ medium
██ low
██ n/a
Credit: Wikipedia.org. HDI data for 2004

54. Ghana: Agriculture Details
5 acres, 2 or 3 full-time workers, part-time assistant during planting and harvesting
Family business. Strong communal element.
Traditional land ownership held in communal trust
Child labor. WOSPRO will ensure no child abuse takes place.
Average turnover: US$3000
No storage facilities
Exploited by middlemen
WOSPRO model fits traditions.
Farmers still own their land/farms.
shared resources: storage, husbandry, training.
No privacy issues 54

55. Ghana: Natural Agriculture Advantage
Already low inputs, easier switching to organic
About 3 months to switch in Ghana, 3 years for developed countries
Already low earnings,
premiums an even bigger boost
All we need to do: increase capacity

56. Ghana: Agriculture Low Yield
Ghana agric: not much change since independence
Source: earthtrends.wri.org. WRI : World Resources Institute

57. Ghana: Agriculture Organic By Default
All these graphs support our argument that production is organic by default,
low yield and that agric is in bad shape (almost no change since independence)
Organic shouldn’t be difficult or expensive and our interventions are critical.
Source: earthtrends.wri.org. WRI : World Resources Institute

58. Asante-Mampong Ghana: Agriculture
Products: pepper, ginger, peanuts, shea nuts.
Low cost production!
High quality
Cooperative culture
Asante-Mampong

59. REDF blended value format End of year five, ROI = 2.
SROI: Calculation
REDF blended value format
End of year five, ROI = 2.
accumulative investment of $2.5 mil and net financial performance of $5 mil
Social Purpose Value = 0.5
Return = $2 mil, investment of $4 mil
Health and environmental gains
Additional $2 mil in measurable communal value
Calculated with Soil Association guidelines
Total weighted SROI = 3.0

60. SROI: Employment Creation
Category
Employee Strength
Year 1
Year 3
Year 5
Year 7
Sales/Marketing/
Administrative 18 30 70
150
Agric
Extension Officers 12 28 36
Factory/Packaging Plant workers 6 60
110
Data Technicians 10 16 44
Cyber-interns
(students from local colleges) 24 72
120
Drivers/Logistics 15 48
Farmers’
Cooperative
60 (300)
140(600)
300 (1400)
700 (3200)
Indirect Employment Generation
Haulers, Porters, freight handlers etc.
122
360
600
Agro-input dealers;
Local artisans (carpenters etc.) 86
210
540

61. SROI: Social Benefit Directly to Farmer
Operation
Present
Bottlenecks
Loss of Ideal Output
(yield & income)
WOSPRO
Intervention
Savings
Clearing
Reliance on hoes and cutlasses – limits capacity 6%
1. Tricycle - tillers
2. wheeled, hand-held ploughs 3%
Soil
Enrichment
Lack or resources to invest in expensive fertilisers. 8%
Advanced training in manuring
Composting techniques 5%
Water use
Reliance on rain water.
15%
Rain Water Storage
Sustainable ground water use
Irrigation techniques
10%
harvesting
Frequent bruising of crops leading to reduction in appeal/shelf life
Gloves
scything implements.
Control
Insufficient knowledge and resources to invest in proper management.
Integrated Management
Organic pesticides
12%
Storage
No local storage facilities.
High perishability
Silos
Saw dust, air control
Market Access/
Transport
Average of 2 middle-men before urban market is reached. No negotiation power so underpaid.
30%
One intermediary to export market
Arrange transport
21%
Analysis:
Ghanaian rural farmers are operating at an efficiency of 8% of achievable rates. In the short term, a conventional intervention could raise this up to 96%, but at the cost of sustainability. ‘s organic intervention can manage an uplift to 64% in first two years of operation.
The implication is that in the short term alone output in combined yield and income terms rise 8 times. Diminishing returns flattens this growth in efficiency over the long-term, hence the need for new farmers to be brought on board even as existing farmers expand their land stock.

62. SROI: WOSPRO Employment Generation
Category
Employee Strength
Year 1
Year 3
Year 5
Year 7
Sales/Marketing/
Administrative 18 30 70
150
Agric
Extension Officers 12 16 32 40
Factory/Packaging Plant workers 6 60
110
Data Technicians 10 44
Cyber-interns
(students from local colleges) 24 36 72
120
Drivers/Logistics 15 48
Farmers’
Cooperative
30 (150)
44 (200)
70 (350)
110 (600)
Indirect Employment Generation
Haulers, Porters, freight handlers etc.
180
600
Agro-input dealers;
Local artisans (carpenters etc.) 86
210
540

63. Revenue: Estimates Year 1 Year 2 Year 3 Year 4 Year 5
Sales Turnover (‘000 US$)
400
900
1,200
2,100
4,000
Profit (‘000 US$)
-450
-247.5
52.5
525
1,100

64. Revenue: UK Organic Food Supply

65. Revenue: Market Penetration

66. Required Capital Outlay
Planned Disbursement
Amount US$)
Lease on/outfitting of company administrative, technical and operational buildings in . Construction of contingency storage silos. Lease/rent on office space in , (1 year)
170,000
Working Capital (produce bulk buying etc)
250,000
Cargo trucks for farm-to-farm harvest consolidation.
80,000
Farm equipment (hygiene, health and safety – oriented) to be leased out to farmers on flexible terms (portable irrigation systems, boots, disposable gloves, modern harvesting equipment)
70,000
Operational funds for start-up expenses (pre-revenue overheads), hiring, market research, legal miscellaneous, labor wages etc.
160,000
Total
730,000

67. Cost of Sales & Revenue INCOME ($’000) Year 1 Year 2 Year 3 Year 4
of Raw Crops
400
700
800
1200
1800
of Packaged Crops
180
360
600
1000
of Processed Crops 20 40
300
Sub-total
COSTS ($’000)
Cost of Sales
Storage 8 30 50 80
Bulk Transport 12 25 48 84
Customs & Duties 26 32 75
Marketing 28 36 45
Materials & Operations
Crop Purchases
120
250
350
500
Farming Inputs 70 90
VIRPROX 10
Certification
(start-up) 15 35
Packaging 2
2.5 55 60
Processing 3 4
Freight
55.5
100
160

68. Costs continued Staff Costs Managers 15 30 50 70 80 Extension Officers20 40 60 75
100
Administrative 24 65
Logistics 6 10
Factories/Warehouse 5
Interns 2 8
Sub-total
Staff Travel Costs
Transport 25
Accommodation 4
Immigration
0.5
1.2
1.5
Insurance 1

69. Costs continued Office Costs Rent/Lease 0 (start-up) 30 50 70 100
Communications 3 4 5 10 12
IT Maintenance 2 8
Stationery 1
1.5 6
Electricity
4.5 7
Water
Sub-total
Maintenance
Offices
Factories
Warehouses 15 20
Vehicles
VIRPROX 18

70. Third Party Costs
Insurance 2 3 4 6 10
Bank Charges
0.5
0.75 1
Legal
Advisory
1.5 5
Sub-total
Loans & Debt Servicing
Interest 35 30
Servicing* 15
167.5
94.8
653.5
Total Revenues
Total Costs
Start-up Costs
Taxes
Net Income

71. Certification: SACL Core Processes
Soil Association (SA): Certification conducted via Soil Association Certification Limited (SACL).
SACL:
inspector for compliance with SA regulation
consultancy for producers to meet standards.
CORE PROCESSES
Pre-inspection consultation
Initial technical visit to site(s): Soil testing, customized best practices
License granting
Annual visits
Source: Soil Association Guidance Booklet, 2006.

72. Certification: SACL Peripheral Processes
Organic farming advocacy in developing nations.
Scoping and feasibility studies for decision making (local to national).
Training of certification bodies.
Market development of organic products.
Source: Soil Association Guidance Booklet, 2006.

73. Certification: SACL (Certifier) Consultancy Services
WOSPRO through VIRPROX: Perform SACL peripheral processes.
Developing skills and knowledge for organic farming in Ghana.
Scoping and feasibility studies.
Training extension officers from Kwadaso Agric University, Ghana.
Market development and supply chain mapping.
Still need SACL inspection & certification services.

74. IFC funding deliberations: Ongoing Fairtrade certification: Pending
Milestones
Farmers recruited: 14
IFC funding deliberations: Ongoing
Fairtrade certification: Pending
Organic certification: Pending
Patents and copyrights: Exploration
VIRPROX specifications: Ongoing
Technical and managerial consultations: Ongoing
Incorporation in three countries: Ghana, UK, USA.
Private LLC
Partners owning all shares outstanding after equity arrangements with strategic investors, venture financiers and development fund managers have been concluded.

75. Sale to larger company: SA, SACL.
Exit Strategies
Investor Buyout
Sale to larger company: SA, SACL.

77. Fairtrade: Sales & Growth
Purchase farm produce at fair prices from farmers in developing nations
North American & Pacific Rim growth:
2003 Total Sales US$ million, a 52% increase over 2002
2004 Total Est. Sales of $ million.
Retail Value Global Fairtrade Sales
Year
Sales (€)
Growth (%)
2005 27
2004 33
2003 46
2002 17
2001 11
2000 77
Source: fairtradefederation.org, Wikipedia.org

78. Typical Ghanaian Farmer
Grows organically by default.
Precedent for cooperative farming.
Low scientific sophistication.
No organic certification.
Costs $1200/day for inspection.
Average yield.
Low to medium net income
$500 a year.
Handles product distribution.
WOSPRO provides solutions

79. VIRPROX: Certification Savings
$100,000 per year for 120 farmers
Each farmer has 5 workers.
About $270 per day
VIRPROX: $45,000 per year
VIRPROX cost: $35,000
SACL inspection: $10,000
About $120 per day

80. WOSPRO Innovation
SACL’s going rate for all its certification activities, including peripheral processes, is $1200 per day (plus VAT normally charged at British rates, usually 17.5%).
Soil Association actively partners intermediary organisations such as Wospro to develop solutions to bring down costs. Wospro believes that it can build an innovative system that will bring to an absolute minimum the amount of peripheral certification processes outsourced to SACL. The following list is of steps that will be taken to achieve that result.
I. Organising farmers within a particular community into a cooperative so as to dilute the costs per farmer.
II. A close look at items III and IV on the menu in fig. 1.1 reveals that a web-based electronic system, with complete multimedia functionality, can allow Wospro staff play an effective role as a conduit of training and skills from SACL to farmers at a much more reduced cost than would have been the case were specialists to be dispatched from the UK to Ghana.
VIRPROX:
Similarly, strategies around supply-chains, process-tracks, new field knowledge, and consumer behaviour trends can be shaped in realtime, cost-effectively and synchronously. A system such as is being described allows complex systems to be standardised and is particularly suited to a cooperative model where new members will be regularly added through identical protocols. In this sense, we will have built a responsive mechanism for bringing new farmers ‘’organically onstream’’ in larger numbers, at greater speeds, and at low costs than can ever be achieved using prevalent methods.