Last year, at the height of the COVID-19 an average Kenyan agripreneur laid off two workers and reduced the money spent on wages.
This is according to a study recently released by United States International University-Africa and funded by the International Development Research Centre, IDRC, to determine the impacts of the pandemic and its gender implications on young entrepreneurs.
While presenting the findings of the study at a virtual roundtable, Prof. Francis Wambalaba the
Principal Investigator and Professor of Economics at the Chandaria School of Business noted that by November 2020, 73 per cent of the youth polled were still in business but by January 2021, this had dropped to per cent 52 with a 48 per cent failure rate. Of those 264 men and 102 women still active in November, most had high school education and were predominantly self-employed in agribusiness.
In total, 874 young men and women active agripreneurs from 31 Counties consented in July 2020 to be involved in the study. With COVID-19 restrictions in place, data was collected from 500 selected respondents via email, WhatsApp and phone, involving monthly monitoring and recording of resilience indicators.
Significant numbers of respondents had to fall back on savings or seek additional support from family or business associations. The impacts of the pandemic seemed to hit female entrepreneurs particularly hard with a much higher chance of failure resulting from reduced customer bases and falling sales.
Prof Wambalaba stated that resilience was investigated from two angles. “The first looked at personal resilience including time spent networking, spending on promotions, confidence, and changes made to business plans,” he explained. “Business resilience included reviewing the entrepreneurs’ customer base, sales, jobs and employee welfare, product lines, outlets and technology adoption.”
More resilient entrepreneurs were shown to have spent more time networking, seeking advice and additional funds, and using social media to increase sales. Diversification was also key to sustaining agribusinesses.
“I could no longer afford to keep my employees. I just had to let them go,” explained Jared Omondi Andego from Kisumu County. “Our sales decreased sharply. I used to make an average of Ksh. 6,000 a week, now I can hardly make Ksh. 3,000,” added Benedetta Nangila, a fodder farmer from Bungoma County.
As the pandemic ravaged every facet of life, supporting and working with young agribusiness entrepreneurs became important.
To this end, the United States International University-Africa (USIU-A), through support provided by IDRC and Australian Centre for International Agricultural Research through their Cultivate Africa’s Future initiative, has been providing young agripreneurs, aged 18-35 years, with access to business training, finance and mentor support. The program, implemented by the USIU-A’s Global Agribusiness Management and Entrepreneurship (GAME) Center, aims to enable Kenyan youths to develop and maintain resilient, job-creating enterprises.
“Because of the pandemic, the income is less and varies but I was able to check on my costs. I was not doing that before the training,” Samuel Thuo Irungu, a potato entrepreneur from Nairobi County explained during the roundtable.
According to the Kenya Agribusiness Strategy (2017-2021), youth aged between 18-34 years account for 29% of Kenya’s population and are significant to Kenya’s growth and transformation agenda. However, 70-80% of entrepreneurs fail within their first two years of business. With the disruption of agricultural value chains since the onset of the pandemic, USIU-A received additional funding from IDRC to better understand the factors that allow young people to be more resilient and to keep their agribusinesses afloat. “This rapid response initiative to document changes in real-time, is part of our efforts at IDRC to help inform recovery of policies and reorganizing of food systems during the current crisis but also to help us prepare for future shocks,” explained Kathryn Toure, IDRC Regional Director, Eastern and Southern Africa to roundtable participants.
To provide more immediate support, Professor Amos Njuguna, the co-principal investigator emphasized the need for County Governments to provide stimulus packages to agribusinesses impacted by COVID, including business licenses, seeds and other critical inputs, and agricultural services. More broadly, he also emphasized that agribusinesses needed to be exposed to more diversified markets and marketing channels through county, national, continental and international trading blocs. Government agencies and other organizations working with youth also need to support research, networking, technology and knowledge transfer and capacity building for entrepreneurs.
The GAME Center has said it will support County Governments to implement county specific agribusiness strategies, upscale the training and work with private sector players to accelerate implementation of digital platforms that connect the youth to agricultural value chains.
The roundtable event was attended by 14 County Governments, with the keynote address provided by Prof. Anyang’ Nyong’o, Governor of the County Government of Kisumu who recounted how the nationwide curfew and cessation of international travel reignited the need to build resilient local food production systems.