Timely access to appropriate finances
Most of the business risks which inhibit the growth of sweet potato production in the CARIFORUM region can be alleviated if the primary constraint, the lack of timely access to appropriate finances, is addressed.
The existing loan instrument offered by traditional financial institutions does not meet the needs of the sweet potato value chain because of the requirements of hard collateral and a steady monthly cash in-flow to meet amortised monthly loan repayments. The creation of an economic cluster, either in the form of a farmer aggregator, processor, or value chain coordinator (VCC) can represent the farmers' interests in terms of markets and financial returns, monitor and facilitate the management of the business systems for the stakeholders, and enhance the chances of business success.
It is equally important to establish a dynamic agricultural information system that provides production information for marketing intelligence and marketing information for production intelligence, which will facilitate the investment decision-making process for agribusiness development in the region.
In the region, sweet potato producers are a diverse set of disaggregated small farmers who have to be coordinated. They are the primary entrepreneurs, but often do not get a fair share of the net profits. The proposed economic cluster (farmer aggregator, processor or VCC) has been introduced as a potential solution to look after the interests of farmers, including the efficiency of operations in the value chain system. The proposed economic cluster would have a major responsibility to look after the needs of farmers to ensure that they are not restricted to a fixed farm gate price and that they also benefit from the fluctuating net fortunes of the export market.
Most farmers are in remote or isolated locations which underlines the need for new financial models that consider the strengthening of farmer organisations. It is important to realise that the sweet potato sector offers investment opportunities for the short, medium and long term.
Financial security and efficient management of business systems
The success of any sweet potato export initiative will depend on the positive response to investment (financial security) from financial institutions and the efficient management of the other business systems: corporate governance (laying a sound foundation for operating rules through a trust), marketing (product promotion to generate revenue), operations (resilience, adoption of technology, and growth) and people development (sustainability).