Bangladesh’s Fashol tackles the agrifood supply chain to stabilize food prices for farmers and reduce food waste

The agrifood provide chain in Bangladesh is a complicated one wherein intermediaries (aka “the middlemen”) rule and fragmentation abounds.

“When farmers are promoting their product, they’re doing so at a loss,” Sakib Hossain, CEO of agribusiness market Fashol, tells AgFunderNews. “If I actually need to assist farmers, I want to purchase their merchandise at an excellent worth.”

Retailers, too, face an advanced shopping for course of riddled with uncertainties, to not point out sleepless nights, he provides.

Fashol goals to alleviate these constraints and streamline the method by way of its platform that straight connects farmers to retailers, prospects and capital. The Dhaka-based startup, based in 2020, hopes to stabilize meals costs and scale back meals waste on the similar time.

With nearly half the inhabitants of Bangladesh employed by agriculture, the corporate faces loads of alternative in Bangladesh and past.

Fashol lately joined the AgFunder GROW  Impact Accelerator‘s fifth cohort, which is at present going down in Singapore and remotely.  [Disclosure: AgFunder is AgFunderNews’ parent company.] The corporate raised $1 million final 12 months from Orbit Startups, South Asia Tech Partners and others.

Under, Hossain and co-founder Numair Hussain talk about their journey from promoting a number of chickens throughout Covid-19 to launching a enterprise they are saying is “a no brainer” for farmers and retailers.

AgFunderNews (AFN): How did the corporate begin?

Sakib Hossain (SH): Throughout Covid  every little thing was shut off; solely meals [services] have been permitted to go across the nation.

So I purchased reside chickens from my hometown and bought them in Dhaka, and it was an excellent revenue. Then I noticed that if I may make a lot cash in a single journey, there have to be a whole lot of revenue.

I went round to the wholesale markets and visited the completely different districts in our nation to essentially work out how the availability chain works. I talked to farmers and realized that [their] rapid downside was not IoT units or different tech. When the farmer is promoting his product, he’s doing it at a loss, so if I actually need to assist the farmer, I want to purchase his merchandise at an excellent worth.

I additionally talked with retailers, and their shopping for course of was actually, actually difficult as effectively. There’s a whole lot of meals waste taking place — round 35%. Costs are very risky, too.

Numair Hussain (NH): In Bangladesh, greater than 40% of our workforce is employed within the agricultural sector, so we’re an agricultural nation. Once we began moving into the enterprise we noticed the injustice in that the costs farmers finally get [for their products] weren’t truthful. So there’s a social angle to why we acquired into the enterprise and proceed it.

AFN: Moreover fairer pricing for farmers, what different issues does Fashol remedy?

SH: We began with [the question], Who’re the stakeholders who’re shopping for bulk each single day? They’re these mother and pop retailers, wholesalers and eating places, and many others.

We approached them and found out that these retailers have been doing this [type of] enterprise for the final 25 years. If we need to get into this enterprise, we’ve to supply one thing that’s a no brainer [for their business]. In the meantime, if we’ve demand [from retailers], we will purchase from farmers. If we don’t have the demand, we will’t.

So to drive demand, our providing to the retailer was that we’d ship all the produce to their store within the morning.

Usually, these retailers go to the wholesale market to purchase their produce at 1am, and so they keep there till 6am. When their shopping for course of is accomplished, they’ve to determine how they’ll take the wholesale produce to their store.

Often a retailer buys round 300 kilograms [of produce] per day, however the minimal van dimension is 1.5 tons. Meaning they both want 5 individuals to get the total use of the truck or they take the entire truck and have losses as a result of they’re paying for 1.5 tons.

Then, as a result of the proprietor was awake all night time, he goes to the store within the morning, then he goes dwelling and he sleeps, and he has to rent another person to run the store.

Once we got here in, we stated, “You don’t need to go to the wholesale market. The worth goes to be the identical or 1% lower than the wholesale market. You possibly can place the orders at 10 or 11pm at night time, and we ship the produce at 6am. If we had informed them they needed to order sooner or later earlier than or two days earlier than, this mannequin wouldn’t work. A small retailer solely finds out at night time what’s left and what he wants to purchase.

AFN: What was the preliminary reception of Fashol like?

SH: Everytime you begin one thing new, there’s going to be some resistance, and we confronted that. However there have been these small moments the place we additionally actually owned the market.

As an example, there’s a small market with 20 retailers, and out of 20 retailers just one was making an attempt [Fashol]. Right now there have been loopy rains within the nation. Due to this rain, the wholesale market didn’t even get the possibility to promote its produce. That night time, solely the one store [using Fashol] acquired its produce. After that day, all the opposite retailers in that market have been like “Now we perceive the significance.”

AFN: How did you change into concerned with the GROW accelerator?

SH: You can say it was accidentally. I used to be already speaking with the AgFunder group. On the similar time, Ashraful [Rokon, senior executive: impact and partnership at Fashol] was in talks with the identical group concerning the GROW accelerator. We didn’t even know.

AFN: What’s your funding thus far?

SH: We have now raised round $2.1 million. On this newest spherical we’re elevating $3 million. Out of that $3 million we’ve raised $1.2 million, and we’re nonetheless elevating.

The numbers are very strong. We’re actually rising very quickly. We need to go world, it is a large alternative.

AFN: So you have got ambitions past Bangladesh?

SH: There’s no level to only being in Bangladesh. This explicit sort of enterprise could be utilized to some other nation. There are locations the place the market could be very open and there’s not a lot competitors.

As a result of Bangladesh is closely depending on agriculture, we produce greater than what we’ve demand for within the nation. So we’re already doing exports yearly.

We need to assist the nation on this course of. We’re already exporting to Dubai. That is one factor we’ll be targeted on for the subsequent 1.5 to 2 years. I feel we will apply the identical enterprise mannequin to different locations, and actually construct a market the place we will ship orders not solely from, say, Bangladesh to Dubai, however Dubai to Pakistan or Dubai to someplace else. So in fact we need to be world, however one step at a time.

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