S4S solar food dehydrators

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Farmers often struggle to find a buyer for “ugly” produce, as buyers associate natural imperfections with poor quality. That is where Science for Society (S4S) comes in. The company uses technology to convert what is perceived as waste into value. S4S sells solar conduction dryers to women micro-entrepreneurs (MEs), who use the dryers to dehydrate fruits and vegetables, restoring the value of rejected produce to smallholder farmers. The MEs purchase the dryers on credit through asset finance partnerships.

From the beginning, S4S had market linkages in mind. Farmers would gain a new potential market for lower-grade produce: For instance, misshapen onions could be transformed into onion powder. Moreover, MEs had a guaranteed buyer in S4S, which purchased the dried product, aggregated it in a central facility, and sold it to large-scale buyers, including corporations like Nestle and Sodexo.

Yet something was missing. For any asset, maximizing utilization — i.e. the share of potential output that is reached — is the key to success, and S4S’ assets were underutilized. The potential market was still too far away for many farmers, so MEs were not receiving sufficient produce from farmers to pay off their dryers, let alone make a profit.

S4S solved this problem by moving closer. They established a network of village-level collection centers within 2 km of farmers. The efficiency gains are now as much as 16-30% for farmers, and this competitive advantage attracts more smallholders and allows S4S to maintain supply for its MEs. S4S moves produce from these collection centers to the MEs for dehydration, then it purchases the dried produce and sells it to large buyers, as it did before.



A systems-level approach to value chains
What Promethean and S4S have shown us is that selling efficient agricultural equipment requires companies to take a systems-level approach to a value chain, understanding how inputs, capital, labor and outputs work together. Only when companies have understood the system can they bundle the right combination of products, services and equipment to meet smallholder farmers’ multiple needs. That’s why investors and entrepreneurs need to look beyond technology for technology’s sake, and australia whatsapp number datafocus on how to use this tech to create value.

However, this broader focus does bring some challenges. For example, Promethean and S4S are dealing with more operational complexity, as both companies are now managing last-mile logistics and schedules. But the upside is that they are able to build long-term relationships with farmers, based on the value they are creating. Additionally, the small businesses built around these assets are providing new income for entrepreneurs at the village level.

In terms of whether the benefits of this approach outweigh the challenges, Mahesh Yagnaraman, Acumen India’s Country Leader, is unequivocal: “The market linkages that S4S and Promethean have built are more than just linkages. This is actually a core ‘asset’ of both companies. They have marquee customers, and leveraging that market enables these companies to go deeper in the supply value chain to create value for farmers. They are thus genuinely increasing the value across the chain with the smallholder farmer getting a fair share. This is why we are doubling down on our initial investments.”