Launched about almost eight years ago, Vava Coffee is a social enterprise that has a network of over 30,000 small-holder farmers in different regions of Kenya. The farmers from whom Vava sources coffee are paid a fair and above-market price for the specialty coffee, ensuring sustainable livelihoods. Moreover, communities and disadvantaged individuals are integrated into the supply chain where possible to create job opportunities, the company also works with women in informal settlements, some who are HIV-positive, who sew cloth pouches for Vava’s Specialty Coffee. The goal is to provide an opportunity for the marginalized to move out of poverty and take a step towards self-sufficiency.
The company believes that the current structure for premium coffee is inequitable. It favors buyers and consumers at expense of producers, contributing to low incomes and entrenched poverty in farming communities. The organization seeks to counter this imbalance by taking a direct approach to its relationships with farmer groups while scaling and sustaining an international premium coffee brand.
Cycle of poverty and insecurity
The management has observed that the prevailing coffee market places all the risk inherent in agriculture on farmers, who provide the investment capital required to plant, fertilize and grow each new crop but have no guarantee of a sale. Licensing regulations require farmers to sell their crops through farmer cooperatives, which provide inputs on credit and aggregate and sell final products at auction to large commercial buyers. These auctions often result in bottom-dollar wholesale prices, and payments to farmers can be delayed from six months up to a year after sale. This leaves many farmers in a perpetual state of debt and provides consistently low, vulnerable, and irregular incomes. Farming families subsequently struggle to cover critical expenses such as food, education and healthcare, and have little liquidity for emergencies. Finally, with little access to cash, families have a limited ability to invest in their farming businesses by purchasing equipment, expanding their land or diversifying their crops, further entrenching the cycle of poverty and insecurity. Other problems include consistently low yields of premium coffee and low levels of financial literacy among farmers.
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