Small businesses in food systems hold the key to affordable and healthy foods, report

An estimated 60 per cent of rural and urban Kenyan households access their daily meals from micro/small enterprises (MSEs) at local markets. But despite MSEs significant contribution in shaping food access and consumption, these enterprises have received little policy attention and support, with their role in the food systems not well understood.

As Kenya continues to face the ‘triple burden’ of malnutrition – overnutrition (obesity), micronutrient deficiency, and undernutrition – the role of MSEs can no longer be overlooked. This is an assertion of a report by the Scaling Micro-businesses for Healthy and Sustainable Food Systems in Kenya (SME4NutritionKE) project, which was carried out by Wasafiri Consulting Kenya, Village Enterprise, and Shack Dwellers International, between April 2021 and March 2023. The project, implemented in Bungoma, Nairobi and West Pokot counties, and funded by the International Development Research Centre, sought to identify how best to support MSEs in contributing to food system transformation by providing affordable, healthy and sustainable food.

In most Kenyan households, the report notes, food consumption diversity is low, with people consuming just three types of foods out of a possible 20. This is due to high food costs, low household incomes, highly seasonal availability, and weak preferences for some foods; a majority of which is directly related to the role of agri-food MSEs. Combined with a shift in Kenyan consumption patterns – away from traditional foods towards convenient, highly-processed foods – these factors are exacerbating the issue of malnutrition. To encourage greater diet diversity and healthier food choices by consumers, the report authors argue that MSEs need greater policy support to provide a wider choice of food options at affordable prices.

Currently, MSEs face an unfavourable business environment and come up against various challenges in sustaining their agri-enterprises and providing affordable food. Issues include a lack of working capital and financial support from lending institutions, unreliable supplies and suppliers, high sourcing and operational costs, as well as high rates of payment defaults when offering food on credit to customers.

“The government-led food and nutrition strategies in place have not been addressing the role of small businesses in the food system,” notes Dr. Hezekiah Agwara, Project Leader and Co-Principal Investigator for Wasafiri. Agwara presented the research findings to nutrition sector stakeholders, including government officials in food, nutrition, and trade, at the SME4Nutrition National Stakeholders’ Forum, held in Nairobi. The Forum sought to facilitate dialogue on maximizing the contribution of MSEs in the food system space.

“We wanted to find out how these businesses influence food systems and identify the challenges they face, as well as the policies and interventions in place that can be adapted to help resolve those challenges,” Dr. Agwara continued. He explained that addressing MSE challenges requires proactive interventions, such as reduction or waiver of business taxes, or food market-targeted subsidies. Another key report recommendation is to encourage MSEs to form associations that give them a voice and platform at the national level to advocate their issues.

“Traditional foods like millet, sorghum, sweet potatoes and cassava are highly nutritious but we have neglected them. Working with various players, both in the national and county government, we are looking at how to enhance food system productivity to boost our country’s food security using these foods,” said Susan Mang’eni, the Principal Secretary, State Department for MSMEs Development, Ministry of Cooperatives, at the SME4Nutrition Forum. “How well can we innovate traditional farming practices and incorporate small businesses in the food systems?” she asked, whilst emphasizing the need to encourage more small businesses to embrace traditional foods to boost diet diversification.

“The project sought to bring MSE challenges to the floor of policymakers by sharing the research findings from the three counties – as well as recommendations on how to best engage with small businesses to provide the support they require to become sustainable. Providing financial support to MSEs to enable them to grow their businesses will ultimately lead to greater availability of affordable food in the market. This, in turn, promotes nutrition among consumers who have a greater variety of food to choose from,” Dr. Agwara concluded.

As a result of successful project stakeholder engagement meetings, program and policy interventions have been established for each county. For example, in Bungoma, the County Government – together with The Kenya National Chamber of Commerce and Industry – Bungoma Chapter – will continue convening with other actors to facilitate MSE advocacy policy, market linkages, access to training and advisory services, and information and practice sharing.

In West Pokot, the medical center Equity Afia is committed to working with local health and nutrition stakeholders to address low household dietary diversity through interactive educational programs in local radio stations in local languages. And in Nairobi, the County Government is setting up a Food Liaison Advisory Group – a multi-stakeholder platform representing the voices of various food system actors whose mandate is to flag potential food system-related problems and advise decision-makers on integrated approaches that permit sustainable food system planning.