What impact have you had?
A well-respected project manager and a motorized grinder were needed to start the project. A couple organizations and private donors provided the necessary funding, and from January to July of 2009, approximately 375 containers of peanut butter were sold. Buyers included a diverse group of young and old people, but most clients were students who observed noted increases in their attention spans at school. Two women were employed to make the peanut butter.
The initial phase of the project included subsidies. Following the 375 containers, sales began to dry up with the subsidies and rising seasonal peanut prices. In July/August, peanut market research and cost analysis were performed in order to determine an effective price point for a sustainable model.
BPBP has acquired a Full Belly Project peanut sheller kit, which has increased nut-shelling efficiency and serves as another small business opportunity. Plastic Packaging Corporation has donated 1000 plastic containers and welcomes further participation. Meds and Food for Kids has offered expertise and experience, trained an OFCB agronomist, and donated a higher quality peanut grinder as well as aphlatoxin test kits. JLA Global has provided laboratory assistance, and a former Bridgespan employee has offered consulting. Fundraising is underway to supply the necessary resources for purchasing peanuts in January of 2010.
If BPBP buys peanuts in January when prices are lowest, stores them in the local food bank, sells 127 tubs (32-oz) of peanut butter per month at $3.25 (US) per tub, the project will support itself, including labor of the two women who run it. (This unsubsidized price is 35% less expensive than current local prices and 50% less expensive than Port-au-Prince.) $3773 start-up capital would fund the project for the 8 months (peanut storage duration) at a production level of 160 tubs per month; selling all tubs would amount to a $387.30 return on the investment. Impact will be measured by a list of consumers and the average number of family members benefiting from the peanut butter. Results from a quantitative aphlatoxin analysis at JLA Global indicate that the selection process for removing bad nuts is effective.
What will it take for your project to be successful over the next three years? Please address each year separately, if possible.
1st YEAR: $3773 will be needed to cover the cost of the project for 8 months at a production level of 160 32 oz tubs per month. $1960 of the $3773 will be used to purchase in-shell peanuts in January. These peanuts will be stored in the OFCB food bank under the direction of a college-educated agronomist, who will also teach farmers preventative aphlatoxin techniques. 32 oz containers of peanut butter will be sold at $3.25 and 16 oz containers sold at $1.75. Incentives will include a free tub of peanut butter for “x” tubs purchased and a slightly lower price for clients who recycle containers. Marketing and basic nutritional education will spread effectively via word-of-mouth by OFCB leaders in the church and school--I’m toying with the idea of dressing up as a peanut and walking around Bayonnais to promote the project! The 10 local peanut butter sandwich vendors will be targeted first, as they would be the best customers. ($1415 may be raised in order to support the project October through December by purchasing peanuts harvested in a nearby region in October.)
2nd YEAR: If BPBP sold all tubs during its first 11 months, it would have a profit of $532, not including accessory costs such as repairs. If the project sold less than 127 tubs per month, it would have a deficit that would need to patched with short-term support, and it would enter year two addressing factors affecting lower sales. Otherwise, profits may be invested in labor and capital to boost production.
3rd YEAR: If the project continued to support itself, OFCB would reach out to other organizations that may be interested in replicating the BPBP model.
What would prevent your project from being a success?
If the price of peanut butter is too high to compete with the appeal of a greater quantity of starch (millet, corn, rice), then the project would have to rely on subsidies to lower the price to an affordable level. However, research indicates that $3.25 for a 32 oz container is an affordable price. (Again, it is 50% cheaper than Port-au-Prince and 35% cheaper than current, inflated prices in Bayonnais.) Nutritional education will also help purchasing decisions.