Strategy Development – Pacific Coconut Market
An assignment for Strongim Bisnis, a program supported by the Australian Government in Solomon Islands.
Duration: 17.5 days
Specialist Inputs: One consultant sought
ARF rate: Up to C4
Background to the Strongim Bisnis program
Strongim Bisnis is an AUD14 million, three-year market systems development (MSD) program funded by the Australian Government in Solomon Islands, working under the umbrella of the Solomon Islands Growth Program (SIGP). Its goal is to stimulate growth in specific sectors (initially tourism, cocoa and coconut) through activities that catalyse business innovation, change practices, strengthen collaboration, manage risks, build resilience and increase women’s participation and empowerment. It commenced in July 2017.
The program has three end-of-program outcomes (EOPOs) to June 2020:
- Business is demonstrating potential for increased productivity, greater resilience, better risk management, more income earning opportunities and access to high value markets, measured by higher agricultural yields, more efficient use of assets and labour, and new business models that favour employment, incomes or trade.
- The private sector and government work together to increase opportunities for trade and investment, and form external partnerships that accelerate business growth, measured by a more favourable investment climate and external partnerships that accelerate changing business practice.
- Women and youth have increased economic opportunity, measured by women’s and youth participation in the above outcomes, and specific measures for women’s and youth economic empowerment.
Background to this Assignment
The coconut industry is at a crucial crossroads. Traditionally the industry has relied on the production and export of copra. The price of copra and cost of production/transport are making it a less viable option to drive industry growth over the long term. Many in the industry are increasingly focused on product diversification and value-addition; however, without sufficient information upon which to make investment decisions and appropriate support and expertise to capitalise on opportunities for value-addition; innovation and the potential for diversification will be stunted.
Our partner, a local coconut processor, has an established supply chain and steady bulk exports of organic virgin coconut oil (VCO). The company aims to provide sustainable livelihoods for our rural communities, through the production of high quality virgin coconut oil and by products. The company VCO is produced by a network of more than 50 village producers across the Solomon Islands. Typically, a family owns and runs the oil making machinery, which uses the cold-pressed direct micro expelling (DME) method. The family buys coconuts from farmers surrounding the village. The company sources from over 3500 ha of registered certified organic plantations owned by more than 1000 farmers across the country. More than 60% of oil revenue goes back to communities providing an income to over 5000 people. All oil is Quality tested and must meet strict standards. However, the increased world supply of bulk virgin coconut oil, means that the company has not been able to increase its prices paid to community-based DME production units for a number of years.
The company produces value-added coconut products, such as scented body oils and soaps in the domestic market but has limited exports of those products. The company has a strong vision to expand its market both within the pacific region and internationally, including expanding its product offer to cocoa, coffee, and other potential export products. The company’s products can compete in export markets, initially regional markets and European or Asian markets, but they first need to develop a strategy to identify the most appropriate markets and understand the requirements and standards of these markets in terms of marketing – specifically packaging, branding and advertising.
To address this need, Strongim Bisnis is seeking a qualified consultant to support the company, a key player in the Solomon Islands coconut sector, in the development of its expansion strategy.
Objective of the Assignment
The objective of this consultancy is to work closely with the company to analyse the Fiji, Taiwan, South Korea and Hawaiian markets for potential expansion/export destinations for the company products and to identify potential distributors. The strategy will be devised using market analytics and trends and will need to take into consideration the company’s capacity and vision.
Scope of Work
The consultant will undertake the following:
- Review and analyse key documents related to the company and the coconut sector
- Familiarize themselves with the company business model, opportunities and limitations through virtual consultation with the company’s Managing Director, and/or other company staff.
- Analyse market potential for current/potential coconut products from the company in Fiji, Taiwan, South Korea, and Hawaii, including:
- industry trends in these markets
- existing products/competitors’ prices and strategies (including pictures of products from retail outlets in each country).
- For each country identify potential distributors (contact them for input into the strategy) and create a list with contact information and detailing their interest in current/potential coconut products.
- Develop recommendations for the company taking into consideration the constraints of Solomon Islands’ operating environment (e.g. high operational costs, high transport costs, geographic remoteness, access to finance constraints, human resource constraints, IT constraints) and taking into consideration the company’s social operating model and vision.
- Which markets the company should aim for, including roll-out sequence and necessary prerequisites (i.e. certifications, licenses, etc)?
- For each country, what products should the company promote?
- For each country, what consumer segments should the company focus on and what does that imply for the marketing/sales strategy (i.e. packaging, unit volumes, pricing, distribution channels, promotion channels, messaging).
- For each country, what are relevant regulations, duties, airfreight costs, logistics, etc?
- The strategy should be documented in MSWord, Excel, as well as a summary PPT presentation.
Deliverables and schedule
The assignment will commence in April 2018 and require 17.5 days of inputs by the consultant. The assignment should be completed in May 2018. Deliverables dates will be finalised upon contract signing. All deliverables must be approved by project team.
Timeframe and deliverables
1. Review and analyse key documents related to the company and the coconut sector
Up to 2 days
2. Familiarise with company business model
Up to 0.5 days
Submit strategy document draft outline and methodology
3. Analyse market potential for current/potential coconut products from the company in Fiji, Taiwan, South Korea, and Hawaii.
Up to 10 days
Submit draft strategy highlights
4. Develop recommendations
Up to 5 days
Submit draft strategy document (MSWord) including recommendations.
Submit final strategy document including recommendations (MSWord/Excel and PPT summary).
Skills and experience required
The consultant should have:
- A university degree in the following or relevant field of study: business management, economics, agriculture; MBA preferred.
- Demonstrated experience in working with businesses in the Pacific Island countries on business strategy; coconut sector preferred.
- Proven understanding of private sector development, political and economic institutions, and, particularly the coconut market systems and/or supporting sectors in the Pacific Islands; Solomon Islands preferred.