Around 80 percent of the dairy produced in Kenya is marketed informally — that is, produced by smallholder farmers and sold through channels not monitored or taxed by the government. With the passage of the 2021 Dairy Industry Act, Kenyan dairy producers who wish to sell their milk on the open market must be registered by the county government. This poses a problem for smallholder farmers, who are constrained by a lack of access to resources, technical skills, extension services, and sales outlets to be successful in the formal marketplace. 

Mukurweini Wakulima Dairy Ltd. (“Wakulima”) is a vertically integrated farmer-owned dairy cooperative that serves as a link for smallholder farmers to formal markets. As a thriving enterprise of over 9,800 members and growing, it strives to provide everything its farmer shareholders need to improve productivity and generate income. In partnership with Dairy Nourishes Africa (DNA) — a pilot project implemented by Venture37 and Bain & Company, with funding from Global Dairy Platform and CoBank — Wakulima is now turning to supply chain mapping to help drive the enterprise to its full potential. 

What is Supply Chain Mapping? 

Here, supply chain mapping refers to a detailed mapping exercise that provides information on the cooperative’s operations; including milk supply flow, access to services by farmers, and the condition of available infrastructure such as road networks. It can also generate useful data for analysis and visualization, such as volumes of milk collected and active suppliers, using geographic information system (GIS) software. The analysis can help Wakulima make informed decisions about how to address roadblocks and opportunity gaps in its operational strategy. 

Extensionist Tabitha Njeri (left) and Mrs. Jen Githiji (right) with her favorite milking cow, Queenie.

Milk Production 

The Wakulima brand depends on the quality of its milk; and a consistent supply of high-quality milk starts on the farm. Cooperative members benefit from training, technical guidance, financing, and veterinary services that can improve production and lower costs at the farm level. However, Wakulima’s nine extensionists have their work cut out for them, serving over 1,000 farmers each. Extension officer Tabitha Njeri relates: “I love being in the field, helping farmers find solutions to different challenges. It’s a fulfilling job, but it’s hard work.” Using the GIS mapping analysis, Wakulima is poised to identify additional service providers, such as local “lead farmers”, who can serve as models and expand the reach of DNA technical trainings that improve dairy productivity. 

Procurement and Transportation 

Fresh from the farm, 65,000 liters of milk per day are transported to the processing facility. Wakulima operates a network of collection routes that developed organically over the years, only a third of a mile from any one farm on average. A major incentive for farmers to join any cooperative is the ease of access to a neighborhood collection point where they can drop off milk several times a day. However, the mapping analysis revealed that the transportation routing plan has become overly complex, using contracted vehicles to service 72 overlapping routes. Simon Wambugu, Wakulima’s Milk Procurement & Extension Lead, explains that “pickup trucks, motorbikes, and lorries [open-air cargo trucks] are going day and night to deliver milk to the factory ... it would be too expensive to maintain the variety of vehicles you need to access all the different types of roads that service collection points.” Armed with this information, Wakulima can take steps to reduce the costs associated with route management to improve the efficiency of milk transportation, without sacrificing farmer convenience. 

Motorbikes are used to access dirt roads that are steeper and less maintained.

Milk Processing 

Fresh milk is delivered to the factory three times a day and continuously tested for quality assurance, keeping Wakulima staff and contractors busy round the clock. Yet occasionally, there are cases of milk glut (i.e. oversupply) and spoilage after being transported long distances. To ease milk supply bottlenecks and decrease spoilage, Wakulima constructed two cooling centers to store up to 20,000 liters of extra milk prior to processing. As Wakulima continues to expand, GIS spatial analysis will allow the company to pinpoint the best locations for the construction of additional cooling centers. Keeping fresh milk cool is important to preserving the quantity and quality of milk that reaches the factory, which decreases the cost of operation. This ultimately saves money for consumers and strengthens business viability for the cooperative. 

Once at the factory, around 70,000 liters a day is processed into packaged milk, yogurt, cream, or maziwa lala—a traditional fermented milk—before being sold nationwide to an insatiable domestic market. DNA partner Bain & Company supports Wakulima with demand-side initiatives that focus on reaching low-income consumers. A marketing strategy is currently being implemented in Nairobi, with plans to be replicated in other areas following an evaluation of its successes and lessons learned. The insights gained from both the supply and demand sides will inform actionable steps for Wakulima’s strategic priorities in the coming years.  

Looking Forward 

Wakulima aims to assure profitability for its farmers and a high-quality, year-round supply of dairy for its consumers. As a result of supply chain mapping, the cooperative discovered that it could unlock the potential of its farmer base by ramping up the reach of its farmer support program and optimizing milk collection in its current catchment area. DNA sees opportunity to help Wakulima achieve this by collecting more granular data, such as farmer locations, quantities of milk, drop-off locations, services accessed, etc. As a pilot project, DNA has proven successful enough to be integrated and scaled up through the Kenya Nourishing Prosperity Alliance (KNPA), another Venture37 project that improves dairy production through farmer access to quality forage. 

With the help of data-driven analysis and the combined expertise of DNA/KNPA partners and staff, the cooperative will continue to scale up and give smallholder dairy farmers the opportunity to compete in the formal market. Wakulima serves as a successful case study of how vibrant ecosystems of farmer-allied and environmentally sustainable enterprises that improve nutrition, enhance livelihoods, and stimulate economic growth can transform African dairy industries.