Blog
Building Resilience Through Cooperative Development: Successes from a Rwandan Dairy Cooperative
Ahead of International Day of Cooperatives, learn how a Rwandan dairy cooperative is helping its members thrive through sales, social inclusion, and resilience.
Banner photo: At the KAMA Cooperative's milk collection center, KAMA staff receive milk supplies while others test milk quality.

On July 2, 2022, we celebrate the United Nation’s 100th International Day of Cooperatives, convening the global community around the resilience and economic growth of cooperatives worldwide. At a time when the world is still experiencing hardships from the ongoing global health crisis and market disruptions, we’re reminded of the difference that cooperatives can make — globally, we’ve seen that cooperative members have been shown to be more resilient during times of crisis. Convening around this year’s theme, “Cooperatives Build a Better World,” we’re sharing how a USAID project in Rwanda is improving the performance of cooperatives and helping their members improve their businesses, inclusion, and resilience.

The USAID-funded Cooperative Development Program 4 (CD4), implemented by Land O’Lakes Venture37, has continued its commitment to advance cooperative development by improving the performance of farmer cooperatives across Rwanda, enhancing their profitability and sustainability, while fostering social inclusion for women and youth.

KAMA, a CD4 partner dairy cooperative, has seen particular success through the program. Located in the northern province of Rwanda, the cooperative has 183 members and was first registered in 2009. In 2013, due to business operations issues, the cooperative shut down in 2013. After it closed, members of KAMA were disappointed that what was once a pillar of their community had dissolved, so they came together to take action, reorganize, and reopen the cooperative with a renewed commitment to long-term business sustainability.

Before joining the pool of CD4 partner cooperatives in 2019, KAMA was collecting 1,000 liters of milk per day — 30 percent of its production capacity — and did not have any active contracts with milk buyers. Without contractual formalities, the cooperative relied on sales via unreliable middlemen that failed to pay the cooperative on time — or at all. At the time, the cooperative was only earning income and revenue from the sale of milk, leading to little profitability, and it did not have short- or long-term strategic plans for growth.

CD4’s partnership with KAMA focuses on improving KAMA’s business and operational capacity. Since the start of this partnership, KAMA has been receiving tailored coaching and training on governance and leadership, financial management, business development services, and gender.

New Growth: Tripling Milk Production and Boosting Sales

The positive effects from CD4’s tailored coaching and training are significant for KAMA’s leaders and members. KAMA’s milk production has tripled from 1,000 liters per day to 3,000 liters per day, and the leaders secured contracts with reliable buyers. To meet the demand of milk, CD4 helped KAMA enhance new services and businesses — mainly veterinary pharmacies, an animal feeding business, and provision of veterinary services, including milk hygiene and animal feeding training. With the increased knowledge that these training sessions provided, KAMA’s annual sales increased by 20 percent.

From these financial gains, KAMA has used its surplus to buy and provide milking cows to its members, in line with its renewed cooperative goals of increasing milk collection to 6,000 liters per day. KAMA has also initiated savings funds that allow its members to access business loans to improve the health of their cattle and provide for their family. After creating two new veterinary pharmacies, its veterinaries are helping members to improve the health of dairy cows, providing access to artificial insemination, and delivering training sessions on milk hygiene and animal feeding, all of which is increasing milk production. With this vet business and inputs shop, KAMA is receiving additional revenues from drugs sales and selling of animal feed to members and farmers in the cooperative’s vicinity.

To ensure professional management, KAMA has recruited new staff such as a milk receptionist, an accountant, and a veterinary.  As a result, members are receiving swift veterinary services, payments to farmers are completed on time, and financial reports are timely. The staff are in constant communication with members to ensure they are satisfied with the delivered services and encourage discussion of any needed improvements.

Prioritizing Youth and Women

Through the cooperative’s youth mobilization plan, 24 youth have been recruited and were given priority to provide cows to members. As youth were previously struggling to pay their share of capital, the cooperative now allows them to pay in installments to make business opportunities more accessible. The program is also engaging them in cooperative coaching and training programs.

Irakunda Gaudence, a young KAMA cooperative member shared how the program made an impact for her and other youth: “It was not easy for young people to pay in full the share capital. The fact that KAMA allowed young people to pay shares in installments has motivated many of us to join our cooperative and access the different services the cooperative is offering to its members.”

Likewise, Niyigena Fils Gerard, another young member, shared: “I never thought of having my own cow; I am grateful that KAMA cooperative gave me one. I am supplying 10 liters of milk to the cooperative per day and able to save through our cooperative saving scheme and meet my basic needs, as well as supporting my parents financially.”

In the early stages of the program, CD4 created a gender action plan which helped inform research related to gender inclusion. Through the program’s gender action plan and gender research training sessions, female cooperative members found that they could be more active in their cooperative, with a focus on women’s economic empowerment through business management and entrepreneurship training. These training sessions have enhanced the role of women in cooperative leadership, as well as in their households. After the training sessions, the female cooperative members shared that they have an improved sense of confidence and competence to lead. For example, Mukafurere Philomene, a female KAMA member shared, “Before the gender training, milk transportation was considered as men’s job. With the gender training, I was able to understand that it was a gender stereotype and gender culture roles. Today, I defied gender roles, I am a cooperative milk transporter supplying 500 liters per day.”

Adapting in the Wake of Crisis 

Like businesses around the world, KAMA has endured the impact of the COVID-19 pandemic across every facet of its organization. Yet, the pandemic drew attention to how cooperatives can serve as an avenue for building resilience through community action. Cooperatives offer a unique model that places community at the heart of business decisions. In KAMA’s case, leaders and members understood the importance of rebuilding better together. KAMA responded to the pandemic by introducing an emergency fund to provide financial and in-kind support to its members, milk transporters, and staff. It also initiated savings schemes to support members when accessing affordable loans, with no interest rates to its members. KAMA improved its business recovery approach and continuity plan, set emergency and savings funds, and developed risk mitigation strategies.

For more than a century, cooperatives have been used to answer some of society’s most pressing challenges. From providing food security to reliable electricity to much needed financial support, cooperatives have formed to uplift people and provide strong, resilient communities. Cooperatives build a better world by focusing on what matters most: people, their families, and their communities. Business practices, rooted in the principles of cooperation, will stand the test of time.  
 
By Alice Uwingabiye 07/01/2022