YAP proposal #140: Commercialising Coffee Products (Kyewalabye James, Uganda)

Real Agricultural Solutions for Africa Limited (RASA Ltd) is an idea that was conceived by six young men who were by then second-year students at Makerere University, undertaking the Bachelor of Commerce programme. They had a dream to engage in agriculture through doing large-scale value addition to Ugandan agricultural produce—producing products that are highly marketable and can be sold for reasonable prices on the market. The company was registered under the Companies’ Act of Uganda and is now a private company limited by shares.

RASA Ltd started as a value addition hub for coffee-production value-added products, including the first coffee liqueur produced in Uganda: Legend Dark Coffee Liqueur. There were, however, challenges to supply, with inconsistent quality of coffee, that, in the long run, led to poor quality of our final products. This was an eye-opener and we realized that we had to get into direct contact with farmers and be in control of quality issues right from the field to processing.

Currently, we add value along the coffee value chain to increase productivity and take advantage of profits from different levels. We start our work from production and distribution of high-quality coffee seedlings in partnership with a certified nursery, offered to farmers. We have partnered with a coffee nursery that multiplies these seedlings and it has been certified by the Uganda coffee development authority (UCDA) allowing us sell seedlings to key government agencies.

We also supply them with inputs like fertilizers, pesticides and tarpaulins, and offer processing and transport facilities. These inputs are partly given to farmers on credit and payments are made after harvest. This is a convenient model given that we are also the sole buyers of over 85% of the farmers’ output, which we resell to exporters and other players in the coffee industry. We, in addition, offer access to processing facilities, like bulking, hurling, and wet-processing to farmers, both directly and indirectly. This helps the farmers sell in large quantities and hence get higher prices and enjoy economies of scale.

rasa products

To create alternative high value sustainable markets, we do value addition by producing highly marketable and new products from coffee like liqueurs, creams, cakes, and juice. We have also planned to set up a few small coffee shops around Uganda that not only brew our coffee but also act as major outlets and distribution centres for the other value-added products, also encouraging local consumption.

Coffee is the leading cash crop in Uganda, contributing to over 19% of the total exports of the country. With drives to further promote local consumption of coffee going on from different development partners, this is a highly sustainable sector to invest in as there is a large market to address. Just recently, Caffebene, a South-Korea-based coffee house with a presence in over 1,600 locations, agreed to buy coffee from Uganda. Such drives show that this is a lucrative trade and all these initiatives can be self sustaining.

RASA is a strong believer in sustainable and profitable social impact and we our entity has the following positive social impacts:

Job creation—massive expansion will lead to more employment in various sectors of our entity. Unemployment figures in Uganda are over 80% and this is a big social problem.

Increased access to inputs—many rural small holder farmers lack access to inputs like high quality planting material due to the high costs associated with them and lack of access to credit facilities from banks and MDIs. We give these inputs a credit basis and they pay back the cost of inputs at the time of harvest and we are the sole buyers of this output.

Increased income to the communities as a result of access to alternative high-value markets for farmers’ output leading to an increase in revenue. A farmer with an acre from coffee with ready market earns about USD 4,500 a season enabling access to social amenities and improved living conditions.

RASA started as a value-addition hub to produce highly scalable value-added products from coffee. But, we took on the project of working with farmers through provision of inputs and processing basically to ensure a constant steady supply of coffee to our enterprise. Through a centralized processing area, we can ensure that we get a constant supply of high quality coffee to use in making our products. We also provide the community with access to processing facilities to add value to their coffee and command higher prices on the market.

RASA Ltd currently has a semi-automated production line that is located in Komamboga, five miles off Gayaza road in Kampala. This is where the premises that house this company’s administrative work are found. Legend Dark Coffee Liqueur has been established in the market in areas of Uganda in five major districts with agents. The company has been certified by the Uganda National Bureau of Standards (UNBS) a body that is responsible for regulation of all foodstuffs and it has a mark to show that it produces a quality product and also opens up a great window to enable expansion into regional markets.

We are so far currently working with two farmers’ networks: one in an Arabica growing region and the other growing Robusta coffee. In partnership with the Consortium for Enhancing University Responsiveness to Agribusiness Development, we have been able to get access to roasting facilities. This has helped eliminate the high costs of setting up a roasting facility making us be able to achieve our goals faster.

There are plans already underway to expand production by having a wet processing plant in eastern Uganda to ensure steady and constant supply of high quality coffee—that is our basic and most important raw material. Our long-term plan is to set up small coffee kiosks and coffee houses in different regions of the country. These will also double as distribution centres for our value-added products and will also be market outlets for us to sell brewed coffee.

We measure our success by direct impact on the community. Our main major goal is increase in income and this directly follows with amounts off coffee processed and sold through market linkages. Other success factors will be market linkages in new areas. Increase in sales figures directly translates into an increase in production figures and hence increase in farmers income

With the USD 5,000, we will look at increasing the capacity of our project as a whole.

USD 1,100 will be spent in the first month on provision of inputs to established coffee farmers with maturing trees mainly in form of tarpaulins, pesticides, and equipment to make sure they maintain a high quality at time of harvest.

We will spend USD 1,400 on completion of the work on our wet-processing facility. We have worked with a local fabricator to make a pulping machine for us locally.

In the fourth month, we will increase production capacity by spending USD 1,000 on automation of our packaging line.

Within this same month we will spend USD 1,000 to procure processed coffee from the farmers and use it in our production process to increase on our market share.

With this increase in market share, we will invest USD 500 in marketing in the seventh month, as this is a market-driven entity and we have to boost market to be able to expand social benefits.

We hope that we are considered for the global GCARD3 consultation so that we can have a mutually beneficial interaction.

Blogpost and picture submitted by Kyewalabye James (Uganda): mailto:jameskyewa[at]gmail.com

The content, structure and grammar are at the discretion of the author only.

 

This post is published as proposal #140 of “YAP” – our “Youth Agripreneur Project”.

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107 thoughts on “YAP proposal #140: Commercialising Coffee Products (Kyewalabye James, Uganda)

  1. wooow…. way to take Ugandan coffee. good initiative. i like the fact that you are working directly with farmers. i hope you get chosen all the best.!

      1. Yes james this idea is very feasable and very realistic. Keep going this is the future of ugandan coffee

    1. Yes Mark, we appreciate your recognition of the farmer, as a matter of fact the branding of this fine coffee liqueur has alot to do with the farmers at heart, and beyond that we work with the farmers and the families at large as rural farmers have their families involved.

  2. Hey good work . You have combined access to inputs and market creation both major problems in the coffee industry. I would like you to extend this model to our region . I have a network of over 200 farmers in arabica farming.

    1. Am with you anabel this is a bright light for the ugandan coffee sector. Covering the biggest problems

    2. I agree with you. They should spread this model to other regions in more districts of uganda. It can create great positive change

  3. From oil boom to doom globally, agriculture is the hope for our continent. Great idea, i wish you could get government support in your game-changing strategy to give coffee in uganda a new face

    1. thanks Emmanuel . we will lobby to the government and i GFAR should move with us in this game changing journey.

    2. Emmanuel coffee used to be the black gold of uganda. But it had declined because of problems of market linkages and extra markets apart from the export market. This can encourage local consumption and increase local coffee consumption if it is marketed and scaled correctly.

    3. Not only the government but even other development partners . given a push, this initiative can be a great game changer as emanuel put it.

  4. The president mentioned the 3cs of 1960 in uganda, Coffee, Copper, Cotton…You have the coffee solution hope also the other Cs get young energetic people to restore their glory

    1. very good. what these gentlemen are doing is very good. the Uganda Coffee Development Authority has a drive to supply over 20 million coffee seedlings. but this may not be able to do a lot without sorting out markets and market linkages, I am very glad for this initiative as value addition is the way to go for coffee in Uganda. I applaud this level of innovativeness . and I wish you all the best in this competition.

      1. you are right Susan. our missions is to create “alternative, sustainable and high value markets ” for Ugandan coffee.

      2. You can not produce what you donot have markets for. I have always been impreseed by the creation of this new markwt chain. Traditionally coffee has been taken only as a hot beverage. Now we have this ready to drink tasty coffee in a bottle.

    1. Thankyou Gerald, we appreciate you more. we believe the youth are a profound resource in society.
      Thank you.

  5. This is a very innovative and new concept in Uganda . being in coffee, u can easily scale this and venture into various regions. I pray that the judges consider your initiative and work with you. we appreciate the work done in our farmers group. we hope to continue working with you . good luck in this competition.

    1. very true we are looking into expansion in other coffee growing regions within the next year.

    2. George, there is a large potential for coffee in uganda. generating over four hundred million dollars annually. this could increase greatly through value addition drives and quality control through access. any one involved in coffee is destined to earn big

  6. Very awesome drink…apparently my best,,,the idea of market linkages in new areas would help a lot for example western Ugandan areas. As Ugandans we are proud of you, Legend is a fantastic liqueur!!!

    1. very true comfort expanding into new markets creates more demand for coffee, translating into increased farmers income with associated social benefits.

      1. The taste if just perfect. And it has alot of serving options. I cant get enough of it.. this innovation is the best the coffee sector has seen in a long time.

  7. very awesome drink,,,apparently my best. The idea of market linkages in new areas would help a lot for example in western Ugandan areas. As Ugandans we are proud of you legend is a fantastic liqueur!!!

    1. We have tirelessly worked to craft the perfect blend of Uganda’s finest coffees to produce the best coffee liqueur just for you..

      1. Brenda remember this team was voted as the most exemplary youth enterprise of the year at the national coffee festival last year, I can’t forget them!!!

  8. no better way to improve the social benefit of the farmer, u made the best decision ….all am waiting for is to congratulate you upon your victory, RASA Ltd is the way to go!!!

  9. I remember the first time I met this team, strong, positive and passionate not just about coffee but for agriculture all together! for youth to have this much love for agriculture and concern about even the rural farmers, I just give them thumbs up!!!!!!! thank you RASA ltd

  10. I remember the first time I met this team, strong, positive and passionate not just about coffee but for agriculture all together! for youth to have this much love for agriculture, I just give them thumbs up!!!!!!! thank you RASA ltd

  11. This group won the first CURAD agribusiness challenge. in the best new product category. i am very happy for there growth and expansion into working with farmers.

  12. lack of access to in puts and processing facilities can greatly reduce yields. this is a very noble cause. promoting the farmer ownership model. good work

  13. This product is highly marketable and has a potential for export out side Uganda. This initiative can change and transform the Ugandan coffee sector, create employment and increase farmers wealth. #highlyprofitablesocialimpact

  14. I first interacted with these gentle men at the feed the future convention in 2014. they where chosen as exemplary youth in agriculture. i am proud of your work and i feel challenged that you can come to think of this initiative. Thank you for changing the face of youth in agriculture. agriculture really can be cool.

  15. Great idea 2 the nation 2 da youth en a challange 2 youth en da nation at large all the best . God bless ue en the work ov ur hands and brains

  16. Wow I like the whole idea of being innovative and I believe tats the way to go as Ugandan youths.Personally ive tasted legend twice thru and i think once ts marketed well then u guys cd enjoy the market share.otherwz keep up the spirit and we hope for the best from u guys.God bless the work of your hands

  17. Wow!!!! this is extra nice …..I trust this to reduce the unemployment in Uganda for it has the ability to grow

  18. Am glad to be part of this fundamental change, and discovery, as a matter of fact, you’re invited to the factory for sample testing , more coffee more value addition.

  19. This is the best idea. This drink is perfect and also is very affordable. It can replace expensive imports like kahlua tia maria.
    Uganda can now compete with these producers .
    Very sharp youth group here.

    1. thank you kenn , our products come packaged in different sizes too so that we can target different market segments and have a very big market share.

    1. a recent publication in one of the tabloids showed that kampala is experiencing a coffee craze with Ugandans falling in love with coffee .with over 50 coffee shops coming up in the recent times.
      there idea of coffee shops is a very promising one.

  20. Yes Emmanuel it is actually in our next phase. these coffee houses will act as market places for our value added products and also brew coffee for sale increasing the market outlets.

  21. Yes Emmanuel it is actually in our next phase. these coffee houses will act as market places for our value added products and also brew coffee for sale increasing the market outlets for coffee.

  22. USAID has put a lot of money in implementation of the coffee policy and one of the components is youth involvement along the coffee value chain . this is a very good initiative that has been taken on by these young graduates.

  23. Lobbying for funds from USAID is hard when u are a small entity. Which isstrange cause one of there mandates is youth involvement I agriculture. ?yet the youth usually operate informal SMEs

    1. Yes true kenn its abit hard to work directly with USAID. We are working however with one of there development programs

    1. Hahaha, on behalf of RASA Ltd, we are exceedingly humbled, we shall do our best to do as you wish, perhaps even make more Legends , thank you

  24. In the year 2016, we hope to inspire more youth, this product along the value chain of coffee was started by university students, the company now celebrates over 2 years as a registered entity and even more as a business, on the aspect of gender, our marketing team is run by exceptional ladies, when it comes to environmental policy the company believes in friendly materials right from raw materials to packaging items, this company has your concerns at heart and even more importantly conveys it to the consumer with a smile.

  25. Thank you, our victory is one we all share, for when we win, the farmer would have won, but even beyond that, seeing him happy is more profoundly touching.
    Thank you indeed.

  26. This is a very impressive initiative I feel very challenged . Youth usually dont think thay traditional cash crops can earn money. This initiative should be chosen to be the flag of uganda

  27. Good way to create employment. Imagine every house hold was having at least one value added product. How much farmers income would that be .. this projevt shoud be supported and expanded

  28. I like the way the budget has been prepared … this shows direct benefits from the farmers. This group is ready to go and not waiting for funds to get kick started

  29. From market linkages to production security all through to acesss to inputs.. this is how we are going to take agriculture to the next level.
    This is a winning proposal .

  30. Woow u guys have been featured on cctv… ur work must be really good . I hope thry really recognize u in this award

  31. Value addition is ranked the most profitable sector in Uganda. This initiative adds massive value to ugandan coffees. I wish investors donnors or local government could partner with u and take the initiative to the next level starting with this competition

  32. We have always prayed for access to credit to farmers . I am happy for this initiative as farmers lack secueities especially youth .. this is a good way to develop the coffee sector as it promotes quality .and in coffee you cannot be a key player without consistent quality. This is a unique profittable venture from these graduates

  33. Great idea taremwa and for the fact that its youth relating among themselves they can best understand there farmer needs and make the entire project a sucess its a grate opportunity for the graduates

    1. Very true Marcel. Its quite encouraging to see youth venture into Agriculture and put their ideas into action.

  34. thank you for your work. finding markets is the biggest challenge for commercial business in uganda.

  35. very inspirational story . i feel very happy to see young men like this working with farmers at grass roots

  36. we need this initiative expanded even to to other crops . such a model can solve problems along all the agricultural value chain. good work

  37. Tasted this coffee liquer in Kenya during the 1st African Agribusiness Incubators Network (AAIN) conference and just fell in love with everything about it. From the taste to the branding and packaging which is way top-notch. I hope I can be able to purchase it from Kenyan shops some day in the near future.

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