Twiga Foods, a Kenyan B2B E-Commerce startup, has launched Twiga Fresh, a subsidiary that will farm and distribute local horticultural staples like onions and tomatoes to traders.
Twiga Fresh will be initially financed with $10 million through debt backed by Development Financial Institutions.
A little backstory
In 2020, agriculture reportedly added 22 billion dollars to the Kenyan economy. Agriculture accounts for 65 per cent of the export earnings and provides the livelihood for more than 80 per cent of the Kenyan population.
However, farmers face a variety of problems which affect their productivity and consequently, the quality of food produce and their pricing. Some of those problems include lack of access to infrastructure like good roads, and lack of adequate financing for domestic farmers, disconnection of farmers from the market (that is people who need fresh produce).
Twiga Food is offering solutions to some of those problems through its B2B supply chain which links farmers to new and larger markets. This formalizes the domestic food market using technology and consequently increases productivity and reduces the cost of food.
Why Twiga Food wants its own farm
Twiga reportedly had to deal with traceability challenges, stock-outs and price volatility, which affected the affordability and security of its offerings. Twiga Fresh was introduced so it can grow some of its own produce and consequently solve those problems.
What about its partner farmers?
Asserting that it is one of the largest commercial fresh produce firms targeting the home markets in East Africa, Twiga Food affirmed that Twiga Fresh will affect only a few farmers. It will continue sourcing some produce from more established and efficie