Planning for Profitability: A Deep Dive into APMI’s Success Model
By: Randall Ennis, Maureen Stickel and Jan de Jonge
Developing a program that improves livelihoods and provides sustainable profit across a value chain requires accurate modeling, meticulous planning, and regular tracking. The African Poultry Multiplication Initiative (APMI) exemplifies this approach, focusing on developing a sustainable poultry model with far-reaching social impact.
The core tenet of the APMI model lies in the realization of value across the value chain. Accurate modeling and planning are the linchpins that hold the entire ecosystem together.
World Poultry Foundation (WPF) CEO, Randall Ennis explains:
“The key to the success of the APMI model is that all participants in the value chain realize value…. If at any point in the value chain, this breaks down, the entire model collapses. We must have confidence that analysis of all of the input and variable costs along the supply chain are accurate and can provide a sustainable outcome for all involved.”
Through thoughtful planning and evaluation of risks, we position our private-sector partners, Brooder Units (BUs), and Small-Scale Producers (SSPs) for prosperity, establishing long-term success even when donor funding ends. The planning stage isn’t just about immediate outcomes – it’s about architecting long-term success.
Feasibility: Laying the Groundwork
Before initiating operations in a new country, our first step is to examine market dynamics to evaluate whether the APMI would be successful. We assess whether projected profitability is sufficiently robust for our private-sector partners, BUs, and SSPs. Key considerations at this stage include: local market conditions and prices, input costs and availability, local chicken breed preferences, market and cost risk, and more.
This phase builds a solid foundation determining long-term program viability in a country and is essential to ensure the entire value chain remains profitable even after external funding ceases.
Planning: Crafting a Comprehensive Strategy
Once feasibility in a country is established, a local partner is selected, and we delve deeper into the model, working collaboratively to develop a robust business plan taking into consideration our partner’s needs and strengths. Senior Program Director for Africa, Jan de Jonge, explains, “The planning stage is very important. We work closely with our local partner to dig deep into a business plan and unique local conditions to ensure we are developing a value chain that is exciting for them.”
In the initial planning phases, we work across the following areas:
The operational landscape is far from static – feed prices fluctuate, inflation rates shift, and technology advances. The model is pressure tested upon implementation of the rollout of birds to verify each assumption. If for some reason we misjudged or miscalculated financial viability in the model, we must make adjustments and changes to the program to ensure success.
Evaluating Model Accuracy and Defining Success
The litmus test for success is the continued purchase and adoption of the new dual-purpose (DPP) birds by farmers. This demand-driven adoption is a clear marker that our models are effectively translating into real-world benefits.
“It takes several cycles to get a good feel for the profit flow in the process…a simple gauge of the success is the demand for the DPP products in the rural areas. If the birds are being sold and then the farmers repeat the purchase, it means that they are realizing a value. Success is less about absolute values and more about trends. If the companies are increasing sales year on year, which is what we have seen in Tanzania and Nigeria since the initial implementation in 2017, the model is correct.”
Balancing Profitability and Social Impact
Balancing profitability for private-sector partners with WPF’s social impact goals lies at the heart of the APMI model. The model envisions comprehensive impact on rural areas, transcending urban centers to reach peri-urban and remote communities.
Director of International Program Development, Maureen Stickel says, “While much of the modeling and planning stage focuses on ensuring that the value chain can be profitable, our ultimate goal is to impact rural households. Ensuring that the model remains profitable for every actor in the value chain is paramount. When building out the cost model, we also don’t just want to forecast sales, but understand what the costs look like for sales into rural areas. We plan for growth not just in the capital region, but penetrating peri-urban to rural areas across the country.”
The APMI serves as a blueprint for creating sustainable poultry models with far-reaching societal benefits. The APMI’s planning process is core to the success of the entire program. It’s a dynamic process, tailored to the countries we work in and the partners we work with to ensure profitability and wide-reaching social impact.
The APMI Program is being implemented in The Gambia and Sierra Leone with generous funding from the Qatar Fund for Development (QFFD).