International Journal of Innovative Research and Development

Moulen Siame ¹

Affiliations
1 Mulungushi University, Kabwe, ZM

Abstract

The majority of Zambian population depend on smallholder farming, predominantly organized into co-operatives, for their livelihood and have not performed well in addressing poverty and job creation in spite of interventions from the government and private institutions.

The success of the agribusiness in Zambia depends on the use of innovative business models. The changing consumer buying habits favor product-oriented and not production-oriented farmers; whereby farmers should see themselves as suppliers of consumer products in an integrated national/world food system. 

In order to understand the specific challenges that Zambia’s co-operatives visa-a-vie agribusinesses in agricultural value chain are facing, this study examined the effectiveness of the business models used by a selected co-operatives. The outcome of the study would useful in designing alternative entrepreneurial business model that takes into consideration the local conditions and current trends in agrifood industry.

The findings have revealed that the co-operative business model were ineffective in creating, delivering and capturing economic and social impact, prone to property rights constraints, undercapitalized, non-profitable, hardly employ, mostly production-oriented, and poor management and technical skills. The legal, policy environment were outdated.

Keywords

Business Model, Co-Operative, Social Venturing and Co-operative Entrepreneurship Business Model, Social Venturing Entrepreneur/Entrepreneurship, New Generation Co-Operative Business Model, Institutional Environment and Institutional Arrangement, Smallholders, Traditional Co-Operative Business Model.

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Moulen Siame

Abstract

The innovations in the New Generation Co-operative business model (NGC-bm) have effectively ameliorated the traditional co-operative business model headache. Having started in United States of America, the NGC-bm has been adopted with minor variations in many developed counties such as Canada and many European countries. The application of NGC-bm in agribusiness has brought about the desired social-economic benefits to co-op members and the business model has proved to be just effective as the investor owned firms.

However, by unveiling similarities and differences between NGC-bm and social venturing and co-operative entrepreneurship business model, the paper argues that SVCE-bm unlike the NGC-bm is best suited for developing countries like Zambia that are characterized by adverse economic and social challenges affecting smallholder farmers and weak institutional framework. SVCE-bm is in its infancy but gives hope as an alternative business model to the traditional models that are based solely on main stream economic theories, the classic and neo-classic theories, to accelerate socio-economic development of agribusinesses in developing countries.

The paper starts with the introduction, the theoretical framework and methodology. It then looks at the traditional co-operative business model (TC-bm) weaknesses and proceeds to look at how NGC-bm has ameliorated the TC-bm weaknesses and further compares the NGC-bm with SVCE-bm.

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