A dairy farmer cooperative and its bicycles

by World Bicycle Relief
September 3, 2019
Since 2008, World Bicycle Relief has worked in the Palabana region of Zambia. Over time, World Bicycle Relief has conducted a study to understand the impact of Buffalo Bicycles for dairy farmers.

World Bicycle Relief’s Buffalo Bicycle has earned a reputation for durability, functionality and affordability. Local demand inspired World Bicycle Relief (WBR) to launch our social enterprise arm, Buffalo Bicycles Ltd, a wholly-owned subsidiary headquartered in Africa which operates alongside our charitable work.

Bicycle sales help us fulfill our nonprofit mission by reaching more people with affordable, reliable transportation than we could through our donation programs alone. This social enterprise also helps us achieve economies of scale, increasing the impact of our donor-funded programs. While most bicycles sales are made to non-governmental organizations (NGOs), individuals who purchase our bicycles often do so through employee purchase programs and microfinance loans.

In Zambia, World Bicycle Relief studied the impact of Buffalo Bicycles at the Palabana Dairy Cooperative. Due to limited financial means, individual dairy farmers belonging to the cooperative (co-op) participate in employee purchase programs instead of purchasing the Buffalo Bicycle in full at one time. Through the co-op’s employee purchase program, the bicycle becomes a beneficial capital investment for farmers and their businesses.

To present the findings of Palabana Dairy Cooperative Research StudyDr. Lynne Kiesling, Associate Professor of Economics at Northwestern University, questions World Bicycle Relief’s Alisha Myers, Director of Monitoring and Evaluation, and Dave Neiswander, CEO, on their results.

Lynne: What were your goals with the study and what did you initially learn about dairy farmers in Palabana?

Alisha: It’s incredible that right outside our Zambia office window, we can see firsthand activity increasing and the dairy cooperative itself growing over the years. For this study, we wanted to compare the farmers’ livelihood before and after they purchased Buffalo Bicycles. In particular, our focus was on the farmer’s milk deliveries to the cooperative which included volume, frequency, and regularity. We wanted to see the role the Buffalo Bicycle played in the growth and development of the cooperative.

Dave: To paint a deeper picture, 70% of the dairy farmers own between 2 and 20 cows. Typically, 4 cows produce 60 liters of milk per day. This includes a morning milking and an afternoon milking. A steel milk can full of milk weighs between 80 to 100 pounds. Farmers have to travel from their homes approximately 2 to 17 kilometers (1 to 10 miles) from the dairy cooperative. It’s important to note that from the time the dairy farmer milks the cow and transports the milk to the chiller, he/she has one hour.

Lynne: How was the study constructed?

Alisha: Using clear written records of the farmers, which included milk deliveries and when they purchased a Buffalo Bicycle, we constructed primary and secondary data. Our primary data consisted of 1) interviews with a sample of farmers and Palabana management and 2) focus group discussion with farmers active in the cooperative.

Our secondary data looked at the volume of milk sold and frequency of deliveries for members of the Palabana Cooperative from 2009 – 2014; bicycle sales records from 2011-2014; and Palabana dairy sales. The Cooperative keeps very meticulous records, and I think because of that, we able to construct the study and find what we discovered.

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Lynne: Can you highlight some of the top results?

Alisha: Using the data, we discovered 5 powerful and impactful results based on productivity.

Dave: Palabana sale success is attributed to the strong World Bicycle Relief and Buffalo Bicycles brand awareness in the local community. Through the healthcare and education programs, the quality of the Buffalo brand became well-known. Previously, dairy farmers were using, what we affectionately call, BSOs, aka Bicycle-shaped objects. The BSOs were simply not working due to lack of reliability and to constantly breaking down. Thus, dairy farmers’ purchase of Buffalo Bicycles truly changed their livelihood.

Lynne: Are there other types of highlights from the research that should be recognized?

Dave: To date, there is a 100% repayment from farmers. This is a win-win model for the dairy cooperative. The cooperative itself selects the bicycle beneficiaries and guarantees payment back to Buffalo Bicycle.

Alisha: The 100% repayment rate is worth noting for the Dairy Cooperative and the farmers because it is a low-risk opportunity for both parties. Through a questionnaire, 9 out of 10 farmers indicated that they were pleased with this result of purchasing a bicycle through an employee purchase program. On average, farmers own between 2 to 5 Buffalo Bicycles and exclaimed their Buffalo Bicycles were more reliable than a motor bike.

Dave: We also see that the dairy co-op has begun to make bike sales available for other farmers and entrepreneurs in the community thus creating a hub for local economic activity. In this way, this cooperative of small-scale farmers are able to join together and increase their economies of scale.

Lynne: Are there any aspects of the study that indicate gaps or ways to improve?

Dave: In order to build a strategy of creating a mobilized community, the biggest challenge is finding a way to support bikes with quality spare parts and continue proper maintenance. One of our key focus areas is creating spare part supply chain. Two questions we are troubleshooting are: 1) How do we get affordable spare parts into the field, and 2) how do we share the results of this research study with other regions?

Lynne: Why does this type of research matter to World Bicycle Relief?

Alisha: It is a great opportunity for World Bicycle Relief to learn about the communities where we work. By documenting both successes and failures, it informs our ability to enhance our product offering by understanding the challenges the community is facing and how the customers are using the bicycle. It’s important that we share the impact and experience of this sustainable model with other cooperatives in Zambia as well as other countries.

Lynne: What should I do with the new information/insights?

Alisha: Raising awareness of solving the transportation needs in these communities is critical because a bicycle can cause a revolution in a person’s life. The distances to schools, healthcare clinics and markets are large.

Dave: Your support of World Bicycle Relief’s work provides a 2-for-1 benefit. To meet the specific, underserved needs of rural people, Buffalo Bicycles are designed to be more rugged and reliable. As a result, they’ve attracted the attention of farmers and entrepreneurs motivated and able to buy them for their businesses. For us, these sales promote a sustainable infrastructure of bicycle parts, maintenance and community use. Because our innovative model combines philanthropy with social enterprise sales, we are able to distribute more bicycles per donor dollar through greater efficiencies of scale. Ultimately, your support goes farther and contributes to greater impact for students, families and communities.

Read the 5 key results in the Palabana Dairy Research Study Summary
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