By: Erin Ronald, Jean Baptiste Tooley, Kimmie Meunier
AGRICULTURAL LAST MILE DISTRIBUTION
Distributing products and services to remote communities, known as the “last mile,” is a global challenge. To develop a channel that accomplishes this, enterprises must account for poor infrastructure, high costs, and a need to retain and grow a large network of motivated agents. Though difficult, this process is critical when connecting communities to larger markets, delivering crucial services, and offering beneficial or even life-saving products.
This is especially true in the agriculture sector where sales agents must understand the distributed products or services, agricultural practices, and the relevant community in order to gain farmer trust.
This summer, Erin Ronald, Jean Baptiste Tooley, and Kimmie Meunier conducted research with GSBI alumni MoringaConnect a social enterprise aiming to sustainably grow its network of field agents to reach more farming communities in this last mile. MoringaConnect targets smallholder farmers, and work to increase their incomes by providing agricultural practices and market connections. We investigated the best practices for recruiting, training, and compensating these agricultural-focused agents, conducting 139 interviews with field agents, farmers, and partner organizations throughout 6 regions in Ghana.
This research gave us insight into strategies to successfully build an agricultural sales and extension network, specifically attracting agents, training agents, and contracting and paying agents.
1. RECRUITMENT REQUIRES STRATEGY
Creating a comprehensive recruitment strategy in the early growth stage of a social enterprise is critical. Strategically recruiting agents in different geographic regions will better position the company to scale, while recruiting agents that can effectively acquire customers will aid the overall success of an organization.
Dividing geographic regions allows effective market penetration. In order to maximize agent productivity and drive customer acquisition, regions should be divided before initiating recruitment. Dividing the region depends upon the number of farmers with whom an agent can effectively work, the travel time needed to reach each farm, and the type of relationship necessary between an agent and a farmer. In agriculture, sales frequently occur on a recurring basis, necessitating a high-touch relationship. A high-touch relationship means that agents will have to work with a smaller number of customers in order to devote time to the relationships. When dividing the region and determining farmers per agent it is also essential to consider travel time to ensure that agent’s time is spent effectively. Enterprises must consider these aspects of agent-customer interactions within their business models in order to divide target regions into zones, which will provide reasonable opportunities for sales and services.
Determining agent roles increases efficiency. Recruiting for specific roles in the agent network is helpful to ensure a team works successfully and fosters field agent efficiency. While working with MoringaConnect we found ideal characteristics and roles for each member of the agent network.
The Regional Manager is critical to this process, as they provide the link between the enterprise and the farmers and oversee all agents. MoringaConnect’s Regional Manager who organizes agents in the Eastern region of Ghana, is centrally located among farms. He is able to check in with agents several times a week, and can call planned or spontaneous meetings in order to provide learning opportunities.
Once regions and areas of sale have been outlined, we found it critical for enterprises to determine what type of role the agent should play for the customer. One model is a community-based sales model, where each agent is responsible for selling the product within their respective community. Individuals with leadership roles in their communities are intentionally recruited for this position and are expected to have ongoing relationships with their customers. These relationships allow agents to create a higher degree of trust with farmers, as opposed to engaging in only one-time interactions. This is essential when selling agricultural products or services in the last-mile, since risk-averse farmers tend to be hesitant about heeding the advice or purchasing the products of those who do not know people within the community. However, a high-touch relationship model usually has a high cost per beneficial outcome. This can constrain the number of farmers reachable by field agents. Enterprises using this model have to evaluate its relative advantages versus low-touch models, which generally have broader reach but less impact on farmers.
Recruiting women increases success of the network. Throughout the process of defining the geographical scope of sales agents and the roles that are needed within it, we also found that women should be at the core of an agent recruitment strategy.
Though researching the role of women within the Ghanaian agricultural sector was outside the scope of our project, we found that MoringaConnect had greater success with their first female agent than with male agents. In her community, she was able to successfully convince community members to grow moringa, and support their crop cultivation. An extensive literature review supports these preliminary findings. Women are more effective at connecting with people and are more successful in establishing trust within a community. Intentionally staging women at the core of the recruitment strategy will not only improve sales, but will also offer women more opportunities to positively transform their families and communities.
2. CUSTOMER ACQUISITION AND AGENT PERFORMANCE RELIES ON INTENTIONAL TRAINING
Equipping agents with knowledge of sales and sales techniques increases operational efficiency. Agents that are trying to convince farmers to grow a certain crop or buy a service or a product, should focus on making sales. We observed that without explicit training on how to gain farmers’ trust and sell the product or service, processes become inefficient. In some cases, we observed that agents have to traverse difficult terrain and bad roads multiple times in order to successfully sell products or provide information. This consumes valuable resources and time that could otherwise be spent on customer acquisition. For example, an agent with MoringaConnect had to revisit a community over an hour away five different times in order to convince a farmer to start growing moringa.
Setting general working guidelines can help to boost efficiency. Often, sales agents have high degrees of independence and work on their own schedules. However, it is important to clarify roles and expectations throughout training to ensure that agent time is spent productively. Without clear expectations, agents may spend the majority of their time engaging in activities that are outside the scope of their work, such as helping farmers work in their fields. A list of clear expectations that indicates the amount of time agents should dedicate to their roles each week would be beneficial.
Resources for support make agents feel valued. Throughout our two months, it became clear that the role of sales agents is extensive and hard to accomplish alone. Agents need resources for support, such as a community of agents. Frequent interactions with supervisors were critical to increasing agent motivation and productivity. Supervisors do this by providing targets, facilitating collaborative spaces for discussing challenges, and encouraging communication within the agent network. MoringaConnect uses WhatsApp as a platform for agents to pose questions when they reach barriers in their extension services.
3. AGENTS REQUIRE MOTIVATING AND PROPORTIONATE COMPENSATION
Goals and bonuses create incentive. It is common practice for organizations to offer targets and bonuses within their compensation structure. However, our work showed us how deeply important these are in motivating agents to achieve higher performances. For extension officers, like the agents at MoringaConnect, targets can be set based off of yields. For sales agents, targets can be set based off of the amount of products sold. Designing achievable targets and distinct levels of success allows agents to see possibilities for increased income and opportunity growth. Without goals and bonuses, agents at MoringaConnect rely solely on intrinsic motivation. Identifying a baseline performance for agents per year and compensating agents based on success creates motivating incentives and gives agents an idea of company expectations.
Compensation should meet agent needs. We also discovered that enterprises should not limit themselves to strictly financial compensation. Additional non-fiscal bonuses can be just as incentivizing. We found these to be:
Discounts off of products for farmers
Additional trainings for agents
Meetings with management
Tools that can be used on the job
Throughout our research with field agents, it was evident that age and position shapes incentive desires. For agents that are based in communities and have leadership positions, social standing and community development was far more attractive than monetary compensation. These agents typically view their role as part-time and tend to have a vested interest in seeing the success of their communities. For these agents, reduced price of inputs for their customers, community development workshops, and branded items were more incentivizing than solely increasing their own commissions. By contrast, younger agents were more interested in opportunities for growth within the company, tools that will help their performance at work, and additional financial bonuses. Catering to each of these desires for compensation can make the agent network more attractive to new recruits, increase retention, and ultimately boost performance.
The form of financial compensation will vary depending on agent roles. Commission is beneficial for part-time agents. Salaries or salary plus commission will be more beneficial for full-time agents, especially those who have continuing relationships with customers. Salary may not always be possible for early stage enterprises, but is crucial for retention of full-time agents.
Agricultural last mile distribution work, whether sourcing moringa from smallholder farmers or providing farmers the tools to become successful entrepreneurs, can create profound impact. Building a successful sales network is key to achieving this mission. Specifically, a strategic recruiting strategy that includes geographic division, intentional roles, and women is critical for fruitful agent recruiting. Once hired, agents should be knowledgeable about agriculture, have the ability to build relationships, be able to sell to farmers, and have consistent communication with supervisors. Agents should them be given motivating goals and bonuses and compensated according to their needs.
ABOUT THE AUTHORS
Erin Ronald is a fourth year Environmental Studies and Sociology double major. She is passionate about helping communities reduce social inequalities through sustainable development. After college, Erin aims to continue her vocational discernment, pursuing research that focuses on urban climate change mitigation before applying to graduate school. She is most interested in human ecology, climate change management, and international development.
Jean Baptiste Tooley recently finished classes while majoring in Environmental Studies. He is currently following his vocational discernment in Aberdeen, Scotland as a Center for Food Innovation and Entrepreneurship fellow where he is working with a team to make global climate models. After graduating in June, Jean Baptiste aims to work in agriculture at the intersection of development and climate change before applying to graduate schools.
Kimmie Meunier is a fourth year English and French major. Post-graduation, she plans to spend a year in France in order to improve her language skills, engage in cultural-exchange, and dive deeper into her own vocational discernment. While Kimmie does not know exactly what career path she will follow, she's seeking to advance women's agency and eliminate gender inequality. She is also interested in the intersection between language, communication, and social justice.