TechnoServe Development of a Feed (hay) Business Plan for 2 Independent Commercial Hay Producers in Solai, Nakuru, Kenya Terms of Reference

Terms of Reference for Development of a Feed (hay) Business Plan for 2 Independent Commercial Hay Producers in Nakuru, Solai

1. General Information

TechnoServe works with enterprising people in the developing world to build competitive farms, businesses and industries. We are a nonprofit organization that develops business solutions to poverty by linking people to information, capital and markets. 
Our work is rooted in the idea that given the opportunity, hardworking men and women in even the poorest places can generate income, jobs and wealth for their families and communities. With more than four decades of proven results, we believe in the power of private enterprise to transform lives

The Kenya Market Assistance Program (MAP) intends to support two independent commercial hay producers, who are members of Kamarus Farmers Co-operative, to develop 3year Business Plans for their commercial hay businesses. 

The facilitation of this activity is within a larger intervention that aims to increase the competitiveness of small holder farmers in Kenya. Availability of quality and affordable feed (hay) and supplements will contribute to reducing the cost of dairy production and increasing milk yields, hence the incomes of smallholder dairy farmers.

MAP is a DFID’s program for promoting employment and income generation in selected market systems in Kenya including dairy, water, cotton, inputs and seed sector. MAP uses the making markets work for the poor (M4P) approach to improve the performance of these key market systems considered important for poor people. 

TechnoServe {TechnoServe Inc. is an international non-profit economic development organization founded in 1968.  Its mission is to help entrepreneurial men and women in poor rural areas of the developing world to build businesses that create income, opportunity and economic growth for their families, communities and countries.}an international non-profit economic development organization is implementing MAPs dairy sector strategy focused on feeds, breed and veterinary services and supplying chain interventions. 
TechnoServe has partnered with Kamarus Dairy Farmers Co-operative Society to facilitate the desirable change within the hay and feed market systems.
1.1 Background to the MAP- Commercial Hay and Supplement Feed Interventions
Available literature on the Kenyan dairy sector indicates that 30% of milk produced is attributed to breed potential while the balance of 70% is attributed to animal husbandry which includes feeding, animal health and calf rearing among others. 
Milk production for most small holder farmers in Kenya is still very low with productivity per cow significantly below their potential mainly because of poor and inadequate nutrition {Available literature (Tagemeo 2008) mentions that the current quality status of the Kenyan Dairy herd is low, with an average of 4-5 liters a day or a lactation of 1,200L – 1,400L per year in Kenya compared with over 5,000L per year in South Africa and 5,000L per year in Denmark.} . 
Low productivity is attributed to poor access to information or extension services, low and inconsistent quality of feeds and high cost of inputs. 
Poor feeding regime by smallholder farmers results from high cost and inadequate feed supply to small holder farmers due to factors such land scarcity, unreliable rainfall, low fodder production and exploitation as well as lack of adherence to quality standards for feeds in the market. 
Smallholder dairy farmers feed their cows by letting them openly graze, mostly on common land or even by the roadside – this does not provide cows with sufficient feeds and is also prone to the vagaries of weather and contamination.

Grazing is typically not supplemented with concentrated feeds, depriving cows of the required level of proteins and minerals. 

The main reason for not using hay and commercial feeds is their high cost, erratic supply, lack of industry standards resulting into malpractices hence poor quality feeds. As a result, small scale farmers typically only buy hay during the height of the drought when the cows have to stay alive and there is no grass in the open pastures.
Even then, the quality of hay purchased by farmers is poor and lacks nutritional value because regulations on the feed industry are weak, allowing substandard hay and feed supplements to be sold making farmers unable to recoup their return on the investment.

There is therefore an opportunity to significantly improve the productivity of dairy cows among smallholders by stimulating the fodder (hay) and feeds market, to help farmers optimize the returns of their dairy herds by consistently providing quality and affordable hay to smallholder farmers.  

The long term projections for milk demand both domestically and in regional markets are more than enough to consume this new expected production capacity.
MAP has partnered  with two independent commercial hay growers from Kamarus Dairy to expand their commercial hay production business through a number of interventions including; increasing acreage under hay production, supporting farm mechanization, improving farm management capacity, facilitating linkages with business service providers, promoting  adoption of quality assurance programs and development of effective marketing strategies to increase demand and use of  quality hay as part of farmer’s daily feeding regimes. 

1.2 Kamarus Co-operative Society

Kamarus Dairy is a farmer owned Cooperative registered in 1994 with the objective of increasing milk production; improving cow genetics; providing veterinary, financial, milk collection, transport and marketing services to its members. The co-operative which currently has 200 members is located in Solai Division, Rongai District in Nakuru County. The Cooperatives current production stands at 540,000 kgs of milk per year.

The co-operative is constrained by fluctuations in milk production due to climatic conditions from 3,000 kgs during the rainy season to 300 kgs during dry periods. Majority of Kamaru Dairy farmers have not adopted fodder management practices which has led to the total closure of the dairy on two occasions.

The co-operative has elaborate plans of mitigation by promoting hay and silage production, construction of hay barn for increased storage and hay marketing.

The Co-operative has individual members who are commercial hay producers with over 2000 acres of land under hay production, using basic hay making equipment; having inadequate capacity to establish and manage effective hay businesses and with relatively low yields. 

These include 2 farmers, in Nakuru county- Solai, who are keen on formalizing and strengthening their hay businesses and expanding production and markets for consistent supply of quality and affordable hay to dairy farmers hence require capacity building support from experts.

2. Scope of the Assignment

The focus of this assignment is to develop a business plan for two independent commercial hay producers, who are members of Kamarus Farmers Co-operative Society, based in Solai Nakuru.

a) Terms of Reference for the plan

The specific terms of reference for the assignment shall be;
  • Prior to commencing the consultancy, the consultant will be required to review relevant documents and information relating to Hay and fodder business and generate information that will be used in business plan development and subsequent decision making. The information should include but not limited to the existing and potential market demand for hay, marketing strategies in use, business models for effective hay production, agronomic and quality assurance practices, hay input and equipment market, existing distribution system and pricing mechanism. The consultant will conduct an environmental scan and an analysis to identify the external and internal factors that would affect the implementation of this business and opportunities that exist for growth and investment in the hay sector and for the independent CHPs.
  • Guide the 2 Hay producers in envisioning their role in the hay or feed sector.
  • Facilitate the two commercial hay businesses to develop a vision, a mission and core values for their business.
  • Facilitate the identification of strategic issues/objectives and capture the sustainability aspect of the business
  • Formulate objectives, strategies, indicators, activities, time frame and resources required by the business plan
  • Identify capacity development needs required for effective management and growth of the business.
  • Identify strategies to mobilize resources to improve efficiency and for business expansion and growth
  • Produce the final copy of the business plan report that will include: An executive summary; Company Overview; Production and Market analysis; Growth Strategy Analysis; Internal Resource Development plan; Marketing and Sales Plan; Financial Plan, Risk and Sustainability Plan.
b) Methodology
Business planning support to the two commercial hay producers will be designed based on their specific needs and may  differ from one business to the other and shall include but not limited; farm  visits and meetings with the farmers  at  their farms in Solai Division (Majitamu location); data collection & review, training, information provision, consultation, documentation and development of plans and training materials, structured and delivered in a way that will produce viable business plans that will improve the competitiveness of the businesses.

The consultant will monitor progress through field visits, regular communication and review meetings with client to offer feedback and re-plan.

c) Managing delivery
The consultant will report on day to day basis to TechnoServe’s – MAP Dairy Feed sector lead.  Ultimate accountability is to TechnoServe’s – MAP Dairy Program Manager.  

d) Knowledge management

Effective knowledge management and results measurement is central to effective program delivery.  Consultants are expected to actively support this process wherever requested during the period they are engaged by the program.

e) Expected deliverables

2 hard copies and a soft copy (in CD ROM) of the final business plan shall be submitted to the independent commercial hay businesses and TechnoServe.

f) Time frame

The hay enterprise business planning exercise is scheduled to take place within the month of January 2014 with a number of farm visits, meetings and interactions with the 2 farmers. 
The draft business plan will be submitted to TechnoServe and the CHPs for review within three weeks after signing of the contract. 
The final business plan will be submitted 4 weeks after signing of the contract.

3. Proposal Contents and Evaluation Criteria

All interested candidates should submit the following documents as part of their proposal for the assignment.

Technical proposal
reflecting how the consulting firm will undertake the tasks in the TOR and
demonstrate clearly how information shall be presented
budget (with explanation of line items and level of efforts) with clearly defined terms of payment. The
financial proposal must include all the costs that will be charged in
carrying out this assignment e.g. travel
. All sums need to be stated
in gross amount with all taxes included.
page CV for the consultant
page capability statement
bidder profile and references need to be structured in order to prove bidders
expertise for this assignment in accordance with required qualifications and
expertise defined in this ToR.


a) Roles and Responsibilities

  • Prepare the methodology and develop appropriate tools in consultation with TechnoServe
  • Collect and review data relevant for the development of hay business plan and to inform the project hay interventions.
  • Facilitate the business planning process
  • Prepare the business plan as spelled out in the terms of reference
  • TechnoServe –MAP to link the consultant with the CHPs and structure the meetings or subsequent interactions.
  • Organize logistics for the business planning exercise or process.
  • At least one TechnoServe Advisor to occasionally accompany the consultant to the field/ farmer meetings
b) Selection Process
The assignment will be undertaken by a consultant meeting the following qualifications;
  • Degree in Business Management, Marketing, Organizational Development or a related field of study
  • At least three years experience in development work related to the dairy sector in Kenya
  • Experience in business planning process and implementation
  • Demonstrated capacity to conduct market and business research and report writing
  • Proven track record in providing consulting and capacity development services
  • Experience in application of participatory methodologies including adult learning, participatory planning, monitoring and evaluation methods and techniques
  • Demonstrate a clear understanding of production and management challenges experienced by small holder farmers.
  • Ability to manage stakeholder relationships and expectations
c) Indicative Work Plan
Day 1-2:  Consultations with the 2 commercial Hay producers and key stakeholders and planning for business planning exercise.

Day 3-5:  Review of relevant literature, preparation of analysis report and for the assignment
Day 6-9:  Business planning process
Day 10-11:  Finalization of the draft business plan
Day 11-12:  Input feedback and presentation of the final business plan to the client and TechnoServe 
Specific days of the work-plan will be agreed on between TechnoServe and the Consultant.
The proposal should be received on or before 10th Monday, February 2014 . 
Emails should have the subject line clearly marked as “Business Planning Consultancy Service- KAMARUS”. 
Any proposal received after the time for submission of proposals shall not be evaluated. 
The proposal should be submitted in PDF format to the email address below:

Only the short-listed candidates will be contacted for interview.

TechnoServe Reserves the right to reject the lowest bidder or any other quotations without providing any explanation.

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