Adding value in Zankan

Today I visited one of Fantsuam's most successful microfinance communities: In September 2008 Fantsuam started its relationship with Zankan, disbursing a Cycle 1 loan to 10 women in Zankan, funded by Friends of Nigeria, a community of almost 2,000 returned volunteers from the US Peace Corps as well as VSOs and CUSOs. The Zankan I group is about to successfully complete this first cycle and in December, Fantsuam dispersed its first loan to a further 20 individuals from the community in the Zankan II group, who repaid the whole loan within a month in order to progress to the higher value cycle 2 loan of N10,000 (approximately £50).

Zankan is beautiful and peaceful village which seems miles away from anywhere – when in fact it is about 10 minutes by car from the nearest market centre Manchok and only 30 minutes from regional centre Kafanchan, where Fantsuam Foundation is based.

The main road through Zankan

Children playing outside the hakimi’s house.

Drawing water from the modern pump.

Compound back yard with traditional ‘rumbu’ storage barn

Fat 'agric' chickens - not quite ready for market... yet



A village side street

A small child helps her mother at the pump.

Family compound with yam mounds, roofing straw and rumbu

Hajarah – the Fantsuam Field Officer responsible for Zankan, first took us to greet the district head or hakimi, who personally recommends members of his community for loans. We first approached the dogara, the hakimi’s official guard who led us through the compound to the small reception room where we exchanged greetings and pleasantries with the hakimi whilst a transistor radio blared advertisements in local English in the background.

It transpired that there had been a confusion with days: Hajaran had been expected on the previous day: however the hakimi quickly sent his dogara out to round up representatives of the two groups and before too long six women and two men assembled under the large mango tree at the front of the house.

Hajarah prepares for the meeting whist Michael the driver waits with the trusty Peugeot; Me with the hakimi (centre) and his dogara.

In my role as Fantsuam's Micro Small and Medium Enterprises Development Officer, my aim is to help improve our clients’ businesses, to provide secure livelihoods for our clients and their families. Nearly all our clients are involved somehow in agriculture: either as farmers, processors, traders or retailers. Margins are slim and can be wiped away by a single unsold chicken or unexpected glut of grains on the market. All clients are encouraged to undertake Fantsuam’s Business Development Training programme, a curriculum provided through our principal microfinance supporter, Partners for Development, however it is relatively new and many clients still have difficulty finding the additional N700 (about £3.50) for the cost of the course.

For me the key to a successful business is working out where and why you add value, and then looking to maximise the value (?price) you get for that service and minimising the cost, whilst trying to do as much business as possible. Easy enough to say.

First I met Adamu – the ‘centre chief’ (loan group leader) for Zankan II and his wife Victoria along with centre colleague Yakubu. Adamu and Yakubu are amongst five men in the centre who describe their business as “buying and selling” animals for the local markets. Whilst they do raise their own livestock, their principal business involves buying chickens from the local community and taking them to the market to sell. Without a local market in Zankan they visit nearby Manchok on a Friday, Kagoro on a Saturday and ‘Plateau’ (which is actually the name of the neighbouring State, but has been adopted as the name of a market just over the border) on Wednesdays.

Centre chief of Zankan II, Adamu; his wife Victoria Adamu; Zankan II centre member Yakubu

How had the Fantsuam loan helped them?, I asked Adamu, who wore spectacles and spoke good English. It had allowed them to buy more chickens to take to market. How did they make their profit? They sold the chickens at market for a small premium to that which they bought them. Why would someone pay Adamu more for the chickens than he had bought them themselves – or why would someone sell the chickens to Adamu for less than another buyer would pay?

Transport: getting chickens (or in fact most things) away from Zankan to a market requires paid-for transport, plus the hassle of transporting the goods to the market (alive – chickens are only ever sold alive – next week’s Hausa lesson for us is how to kill one). This is really the business that these men are involved in! So I asked, whilst the loan enabled them to buy more chickens, were they able to therefore drop the individual transport cost per chicken and make a higher profit?

Well no, because whereas before you could put 10 chickens in the boot of your public transport vehicles (free on board), to transport 20, you would now have to pay for an additional seat in the car.

So, I asked, if there were five traders working in a loan group together, each now buying 20 chickens, would it not be worthwhile getting dedicated transport where you could transport more chickens more economically?

Well the problem there is that the five men would not know at what time of the day they would have found enough chickens to take to market to sell, or what transportation would be available.

Next question: surely you could plan how many chickens you would be taking to market? Chickens do not grow up overnight, and if together the five analysed their supply base (the villagers they bought their chickens from) and the age of the chicken population they could do some advance planning and get an estimate of how many chickens would be available from the village for each market day?

If you had a rough idea of that, and also had told your suppliers in advance that you would be buying from them, all the five men might be able to plan their transport to market, their crucial element of added value, more carefully...

I left the men of Zankan II thinking about that dilemma whilst I started talking to the four women of Zankan I, original beneficiaries of the FON loan, and all involved in ‘grains buying and selling’. Three of the four spoke very little English, but their centre chief Esther, who combined her market business with primary school teaching, was able to translate on their behalf.

From top left clockwise- four members of the Zankan I Group:

Jumai Anthony – with seven children aged between 6 and 28, and five grandchildren.

Nta Kut – with six children aged between 30 and 15, and two grandchildren

Mary Abba – with five children aged between 9 and 19, and one grandchild

Zankan I centre chief - Esther Daniel – with 6 children between 9 and 20, and no grandchildren, yet.

Theirs is a seasonal business. In this, the dry season, their produce was corn, millet, soya and rice. In the rainy season they would move to yams, potatoes and cassava. Like the men, all of the women worked the three local markets at Manchok, Kagoro and ‘Plateau’. The women would buy from wholesalers in the market and sell retail from an uncovered market position for which they would pay N20 (about 10p) per market per week with the N300 permit per year.

Buying and selling at Kagoro market on a Saturday afternoon

Having a loan had made a huge difference to the profitability of these women’s businesses.

Without ‘capital’ (perhaps about £5.00 at the start of the day) they would have to buy from the wholesalers on credit, with little control over the price. The loan had given control to the women, allowed them to make greater profits and sell more grains. Not only that but their (numerous) children were now going to school and (as you can see) they were able to dress themselves nicely and use better ingredients in their cooking. Esther and Nta gave me a big smile and said they were happy!

Which was their favourite market? I asked. Manchok they all agreed. They had the best customers there. And their least favourite? Kagoro – there was too much competition. I could agree with them. Kagoro is my local market and I often wonder at the rows of women sitting with their huge bowls of rice and grains, one next to each other, with only the number of stones or weevils per mudu to differentiate the quality, the rest left to price.

What for the future I asked? Nta answered: she needed a lot more money to buy a permanent stall. Which would be covered and where her customers could always find her. Not just on market day, and not just when it was sunny. And not just one stall, but a permanent stall in every market.

In every group there is always the big thinker. The Walmart, the Sainsbury. There was no doubt Nta has ambition. Will she reach it or is she just dreaming? Only time will tell. Maybe on my next visit to Zankan I will sit down and try and work out a business plan for her to take her beyond ‘buying and selling of grains’ to multiple retailer!