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Job Title: TERMS OF REFERENCE - Business Plan Development
Job Summary
The project uses an Inclusive Business Development approach to support the international and national efforts on climate change and sustainable production in arable crop value chains. The project works with and through the private sector and supports public sector partners in creating an institutional environment for large-scale adoption of climate smart practices and technologies. Alignment of efforts and interests of private sector partners (business cases) such as guaranteed off-take of food crops and economic incentives will form the basis for large-scale adoption of climate smart agricultural (CSA) practices and technologies in combination with de-risking production.1. Background
The Climate Resilient Agribusiness for Tomorrow (CRAFT) Project is a 5-year, project being implemented in Kenya, Tanzania and Uganda, with the project management unit in Uganda. The project is implemented by a consortium consisting of SNV (lead partner), Wageningen University & Environmental Research (WUR & WEnR), the CGIAR research programme on Climate Change, Agriculture and Food Security (CCAFS), Agriterra and Rabo Partnerships, and is financed by the Dutch Ministry of Foreign Affairs (DGIS).
The project uses an Inclusive Business Development approach to support the international and national efforts on climate change and sustainable production in arable crop value chains. The project works with and through the private sector and supports public sector partners in creating an institutional environment for large-scale adoption of climate smart practices and technologies. Alignment of efforts and interests of private sector partners (business cases) such as guaranteed off-take of food crops and economic incentives will form the basis for large-scale adoption of climate smart agricultural (CSA) practices and technologies in combination with de-risking production.
The programme is driven by three main pillars;
• Adoption of CSA practices & technologies in arable crop production farming systems
• Acceleration of investments and business growth in selected value chains
• Improved enabling environment for scaling out of CSA.
The CRAFT partnerships involve using an inclusive business approach to drive investments in climate smart practices and technologies. Climate change has resulted in very poor yields and low return to farmers, and other actors (e.g. buyers, processors) in the targeted value chain (sunflower, sorghum, potato and common beans) are also negatively affected. The business cases under each value chain seeks to among others, increase crop productivity within the target value chains, improve market access for smallholder farmers, and enhance quality of produce marketed. The business cases are expected to benefit smallholder farmer, women and youth who are directly involved in the production and marketing of the crops resulting in increased incomes and improved food security. Some of the interventions in the business cases include provision of quality inputs (improved seed, fertilizer), providing climate smart extension services, promote post-harvest handling practices for quality enhancement, linkage with financial institutions to access credit, promotion of labor saving technologies, aggregation of produce, provision of weather information & index based insurance services, etc.
CRAFT business case development follows a four stepwise approach/logic, which includes; scoping, screening & selection, planning & design, and implementation & monitoring. Some CRAFT business cases are currently in the planning and design stage-involving co-creation to develop business models, describe the business cases and develop the business plans. Therefore, CRAFT seeks to hire (a) consultant (s) (individuals or firms) to support in the development of business plans for two (2) SME’s that are in partnership with the CRAFT project.
2. Description of Assignment
This assignment will build on the business case development process previously done through a business model canvas (BMC) workshop completed by the CRAFT team. SMEs or cooperatives have been identified by the CRAFT team and are willing to improve their sourcing and processing models. SME’s or cooperatives under the potato, sorghum, sunflower or common beans value chains face climate risks related to low volumes of less quality grains which cannot meet market requirements, farmers or agents may default on repaying loans received for pre-financing their activities, and due to bad roads, the SME’s face high transaction costs in assembling surpluses from scattered farmers. Other challenges include poor relations with farmers, lack of adequate cash flow to run their businesses, stiff competition in the market among others. The BMC was designed to strengthen the partners to sustainably integrate smallholder farmers (including women & youth) in the value chains, climate smarten their business ideas and to support their capacity to link to markets in general. This was done by realigning or developing new business models for the SME’s.
CRAFT therefore seeks to support SME’s or cooperatives under the four targeted value chains interested in co-investing (e.g., seed multiplication, aggregation and local distribution of agro-inputs, collective marketing, post-harvest handling, processing etc.) to assess their organizations and develop climate sensitive (climate risk factored in) business plans.
3. Objectives of the Assignment
The general objective of this assignment is to support the development of two (2) climate resilient business plans for SME’s or cooperatives in the potato or sorghum value chains through a joint
effort with the company, the CRAFT project and financial institutions.
The specific objectives of the assignment are:
• Develop detailed bankable business plans with a sound financial foundation and prepare selected SMEs or cooperatives to attract financing from financial institutions;
• Define the organizational management structure and skill sets available or required to meet the requirements of the business plan;
• Project realistic income and costings from marketing the products/services over a given period but not exceeding two years.
4. Scope of Work
Based on the objectives, the consultant (s) will be required to co-create with the selected SME’s an analysis of the present scenario and develop a detailed business, financial and marketing plan that is expected to provide overall direction to the SME’s operations making it sustainable, efficient and growth oriented and climate smart in the long run. The business plan is not only meant for the SME but should also indicate how farmers and other actors in the value chain will benefit from the business model. The plan should be time bound and show clear achievable targets within defined timelines. The Business Plan is to have the following sections at the minimum:
• Executive summary/Snap Shot
• Analysis of the organizational status, skill sets, and new skills set required
• Business Model and description of operation/s with clear links to other chain actors and how they will benefit
• Analysis of the products/services offered to up and down stream actors
• Analysis of the market and potential customers
• Marketing strategy
• SWOT analysis
• Risk analysis and mitigation measures
• M&E framework for the time period
•Business case description with a financing strategy
The business plan should follow the CRAFT template and will be provided to the selected consultant (s). N.B: The financing strategy should include funding requirements, financial assumptions and 2 year historical as well as 2-year projections of the following statements:
• Projected income statement
• Projected cash flow statement
• Projected balance sheet
• A risk assessment (sensitivity analysis),
• Financial ratios analysis
This assignment will build on the business case development process previously done through a business model canvas (BMC) workshop completed by the CRAFT team. SMEs or cooperatives have been identified by the CRAFT team and are willing to improve their sourcing and processing models. SME’s or cooperatives under the potato, sorghum, sunflower or common beans value chains face climate risks related to low volumes of less quality grains which cannot meet market requirements, farmers or agents may default on repaying loans received for pre-financing their activities, and due to bad roads, the SME’s face high transaction costs in assembling surpluses from scattered farmers. Other challenges include poor relations with farmers, lack of adequate cash flow to run their businesses, stiff competition in the market among others. The BMC was designed to strengthen the partners to sustainably integrate smallholder farmers (including women & youth) in the value chains, climate smarten their business ideas and to support their capacity to link to markets in general. This was done by realigning or developing new business models for the SME’s.
CRAFT therefore seeks to support SME’s or cooperatives under the four targeted value chains interested in co-investing (e.g., seed multiplication, aggregation and local distribution of agro-inputs, collective marketing, post-harvest handling, processing etc.) to assess their organizations and develop climate sensitive (climate risk factored in) business plans.
3. Objectives of the Assignment
The general objective of this assignment is to support the development of two (2) climate resilient business plans for SME’s or cooperatives in the potato or sorghum value chains through a joint
effort with the company, the CRAFT project and financial institutions.
The specific objectives of the assignment are:
• Develop detailed bankable business plans with a sound financial foundation and prepare selected SMEs or cooperatives to attract financing from financial institutions;
• Define the organizational management structure and skill sets available or required to meet the requirements of the business plan;
• Project realistic income and costings from marketing the products/services over a given period but not exceeding two years.
4. Scope of Work
Based on the objectives, the consultant (s) will be required to co-create with the selected SME’s an analysis of the present scenario and develop a detailed business, financial and marketing plan that is expected to provide overall direction to the SME’s operations making it sustainable, efficient and growth oriented and climate smart in the long run. The business plan is not only meant for the SME but should also indicate how farmers and other actors in the value chain will benefit from the business model. The plan should be time bound and show clear achievable targets within defined timelines. The Business Plan is to have the following sections at the minimum:
• Executive summary/Snap Shot
• Analysis of the organizational status, skill sets, and new skills set required
• Business Model and description of operation/s with clear links to other chain actors and how they will benefit
• Analysis of the products/services offered to up and down stream actors
• Analysis of the market and potential customers
• Marketing strategy
• SWOT analysis
• Risk analysis and mitigation measures
• M&E framework for the time period
•Business case description with a financing strategy
The business plan should follow the CRAFT template and will be provided to the selected consultant (s). N.B: The financing strategy should include funding requirements, financial assumptions and 2 year historical as well as 2-year projections of the following statements:
• Projected income statement
• Projected cash flow statement
• Projected balance sheet
• A risk assessment (sensitivity analysis),
• Financial ratios analysis
5. Deliverables/specific outputs
The expected outputs of this assignment will be a complete Business Plan/s including
• A narrative of the business model of two (2) business cases
• A financial description of the two (2) business cases
6. Support to be provided by CRAFT
• Provide all information and documents relating to the assignment
• Timely nomination and presence of SME staff to support the field work.
• Linkages or introduction to financial institutions
• Provide guidance on the approach to take, and templates to use
• Coordinate and supervise the entire assignment
• Approval and payment for consultancy services provided based on performance
• Organize and invite stakeholders to a validation workshop
7. Location and Duration of Assignment
The assignment will require travel (pending the selection of the two business cases) to interact with project stakeholders. Consultants will be connected with SME representatives, farmer organizations linked to SME’s, financial institutions that SME’s are banking with, agro-input dealers etc. It is anticipated that the development of each complete business case will take 10 effective working days (excluding travel days) and the assignment should be completed by mid-March 2020.
8. Country of Assignment: Tanzania
9. Reporting Requirements and Documentation
The consultant shall submit the finalized business plans on a rolling basis after which they are assessed by the CRAFT team and feedback will be provided within 3 days of submission. The consultant shall submit a detailed work plan along with detailed calendar of SME’s and stakeholders to visit.
10. Review and Monitoring of Work
The Senior Agribusiness Expert or his designate will be responsible for the review and monitoring of the progress of the assignment. He will monitor the progress and interact with the consultant and may also seek comments and inputs on the consultant’s work as found appropriate. Any reports/ process documents produced as a part of this assignment shall be deemed to be the property of CRAFT and the consultant will not have any claims and will not use or reproduce the contents of the above documents without the permission of CRAFT.
11. Skills and Experience
CRAFT would like to procure services of (a) consultant (s) (based in Tanzania) with the following skill set and experience:
• At least 10 years’ experience in agri business development of SME’s or cooperatives using an inclusive business approach
• Proven experience in climate smart agriculture and financial analysis of climate smart technologies
• Evidence of developing business plans that have attracted financing from financial institutions
• Experience in developing marketing strategy preferably for agricultural products/ services
• Analytical skill sets required of different functionalities in an agribusiness set-up
• Experience working with diverse cultural and skills background
•Ability to follow strict time frame
• Good working experience in Tanzania’s agricultural sector
12. Submission of the Expression of Interest (EOI)
For consultants interested to bid for the assignment, they are required to submit two proposals as follows:
A) Technical Proposal: Interested individuals/firms are requested to submit:
• Understanding of the assignment and its tasks
• Methodology and approach to be used
• Operational plan with clear timeline and indication of number of days allocated to each team member for each business plan developed.
• Outline of the team that will implement the work, with CVs for key personnel and clearly specified roles for each team member (if more than one team member is involved in the process).
Note: Technical Proposals should not exceed a maximum of 14 pages (excluding annexes).
Lengthier proposals will be disqualified.
It should also be indicated in the proposal if a component of the assignment will be sub-contracted
B) Financial Proposal:
This should outline the total cost of the assignment, as well as the breakdown of the cost, including any costs of sub-contracting components of the assignment. No lump sums are
allowed. This includes the following details;
• Consultancy fees submitted must be inclusive of all taxes- VAT inclusive (please note that under Tanzanian law, a Withholding Tax (WHT) of 5% for national and 15% international is deducted at source and paid directly to TRA).
• Communication and stationaries
• Air travel, transportation and per diem should be excluded from the budget since these will be paid for directly by CRAFT.
C) A sample of previous work experience, include 1-2 business plans developed to medium sized agri business companies; completed within the last 12 months.
D) Past Performance – three references
Applicants must prove that they have enough experience in assignments comparable with the work for which they are bidding in terms of scope and complexity. Applicants must prove this experience using only and exactly three references for work they have done in the last five years.
• Applicants must provide written proof for each of the references giving at least the following data:
• Name of the contracting company/donor, name of the person who managed the contract for the company/donor and email and telephone numbers for the contact who managed the contract;
• Title of the project or contract or grant and / or the contract/grant number;
• Time and place of execution for the work done;
• Clear description of the services provided by the applicant (no more than one page);
E) Mandatory requirement – Copies of Tax Registration certificate, Recent Tax Clearance, Business License, Company registration. For individual consultants a TIN will suffice. Failure to provide any of the documents above will result into disqualification of the application.
13. Evaluation Criteria
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How to Apply?
Please manually apply for this job using the details below:
Please submit your response by email to Tanzaniaprocurement@snv.org by 22 January
2020 before 5 pm EAT; SNV will communicate to the only shortlisted and successful
firm/individual.
Please submit your response by email to Tanzaniaprocurement@snv.org by 22 January
2020 before 5 pm EAT; SNV will communicate to the only shortlisted and successful
firm/individual.
