More than 90 percent of all producers in El Salvador are subsistence farmers with little to no information about end-markets that will pay them a decent price for their products, leaving them susceptible to intermediaries in the value chain, who often pay lower than market prices for their crops. Despite the growing demand for locally grown produce, the agriculture sector suffers from insufficient production of fruits and vegetables and low productivity stemming from the lack of access to training, inputs, new markets, working capital, and affordable logistics solutions. As a result, most quality produce is currently imported as the local production is insufficient to cover the demands.
CGEP saw a unique opportunity to help transform the agricultural sector from subsistence to commercial viability to meet the growing domestic demand. CGEP replicated their farmer services and aggregation model and facilitated a $1.05 million investment in Acceso Oferta Local – Productos de El Salvador (AOL-SV) to address these key barriers faced by smallholder farmers. AOL-SV purchases fruits and vegetables from smallholder farmers at favorable prices, provides essential training in good agricultural practices, and ensure farmers have access to quality seeds and fertilizers that significantly improve the quality and yields of the produce they grow.
With better knowledge, targeted inputs, services, and available credit, these farmers can in some cases double their current yields with minimal cost increases. These yield increases, paired with reductions in production costs and improved quality lead to higher prices and increased incomes. In 2016, the business started working with fishers, training them on sustainable aquaculture and fishing practices, introducing new technologies, and purchasing their fish and seafood for sale in local supermarkets. Yields for other crops also stand to improve due to better rotation, allowing farmers to diversify their sources of revenue. As of December 2016, the enterprise has worked with more than 1,200 farmers and their workers directly and generated more than $2.8 million in beneficiary income.
Additionally, Acceso El Salvador was recognized as an authorized vendor of Yum! Brands which owns all of the franchise licenses for Wendy’s, Pizza Hut, and KFC. Acceso El Salvador is authorized to supply three different types of lettuce to all the franchise owners of Wendy’s and Pizza Hut owners throughout El Salvador. In addition, as an authorized vendor, Acceso El Salvador has the opportunity to explore other relationships throughout Central America.
Additionally, AOL-SV was awarded as an authorized vendor of Yum! Brands which owns all of the franchise licenses for Wendy’s, Pizza Hut, and KFC. AOL-SV is authorized to supply three different types of lettuce to all the franchise owners of Wendy’s and Pizza Hut owners throughout El Salvador. In addition, as an authorized vendor, AOL-SV can also explore other relationships throughout Central America.