Kenyan young agripreneurs reel under impacts of COVID-19

Kenyan young agripreneurs reel under impacts of COVID-19

Published: 05-02-2021 12:15:00 | By: Bob Koigi | hits: 4784 | Tags:

Kenyan agribusiness enterprises run by young people experienced a 48 per cent failure rate last year at the height of the novel corona virus a new study has shown.

The study that was conducted by United States International University-AfricaUSIU-A, and supported by the International Development Research Centre, IDRC, highlighted the impacts of the pandemic and its gender implications on young entrepreneurs in Kenya.

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.

Analysis of the results revealed that by November 2020, 73% were still in business but by January 2021, this had dropped to 52%) with a 48% 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.

Kelly Kadiviria, agriprenuer, Kakamega County: “I never thought anything like this could happen in my lifetime.”

According to Prof Francis Wambalaba who led the team conducting the study,  resilience of the entrepreneurs to the coronavirus was investigated from two angles.

Prof Francis Wambalaba, Professor of Economics, Chandaria School of Business: “The first looked at personal resilience including time spent networking, spending on promotions, confidence, and changes made to business plans. Business resilience included reviewing the entrepreneurs’ customer base, sales, jobs and employee welfare, product lines, outlets and technology adoption.”  He was speaking at a virtual roundtable event that was attended by 14 County Governments and key stakeholders with the keynote address provided by Prof. Anyang’ Nyong’o, Governor of the County Government of Kisumu.

The study further revealed that the average entrepreneur laid off two workers and reduced the money spent on wages.

Jared Omondi Andego, agripreneur, Kisumu County: “I could no longer afford to keep my employees. I just had to let them go.

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.

Benedetta Nangila, fodder farmer, Bungoma 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.”

However, the 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.

To equip the youth with skills to withstand challenges especially emerging ones like those related to the pandemic USIU Africa with support 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.

The USIU-A training has also provided many of the entrepreneurs with essential skills. “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 (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.

Kathryn Toure, Regional Director, Eastern and Southern Africa, IDRC: “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.”

In order to provide immediate support, Professor Amos Njuguna who was also part of the research team 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.

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.

Moving forward the GAME Center 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.

www.usiu.ac.ke

www.idrc.ca

www.aciar.gov.au