Not respecting business agreements
Mail this brilliant failure
Vote for this brilliant failure
Published by:
Mr. Mohammed MmangaThe intention was:
A story from Mr. Mohammed Mmanga, a farmer leader from Mkuranga district, Tanzania.
One day during my visit to my fellow farmers I saw a woman crying and blaming that she is going to sue the NGO’s like Vredeseilanden because they had persuaded her to produce cassava together with her group members, but the NGOs failed to ensure a market for the product and so the cassava was rotting in her field. I was troubled by this message but I reminded her that the NGOs had told us that we also have to do our own part. Immediately after this conversation I asked my fellow farmers to come up with a strategy for solving the market problem. We agreed that all of us should go to Dar es Salaam to look for good markets for cassava and cassava products as flour, chips or dried cassava.
The course of action was:
We planned to go on 15 November to Dar es Salaam to visit supermarkets, restaurants, big and small retail shops and other market outlets that could be interested in our cassava. We were able to find a possible buyer and she promised to pay a visit to us. We made an appointment to meet her on 17 November at an office in Mkuranga to discuss which cassava products she was interested in and in which quantities. That day she came by and she was very interested. She decided to buy cassava at a price of 650Tsh/Kg. She finally asked us to bring again 60kg of cassava flour the next day, while ordering another 2,000kg of flour.
The result was:
What happened?
The farmers agreed to meet with the buyer on 19 November at 2.00pm in the office. The buyer arrived on time, but the farmers from Misasa village were two hours late and instead of coming with cassava flour as agreed, they came with cassava chips. The buyer was totally disappointed because she had already assured her customers that they were going to get cassava that same day. She decided to leave and promised to come back the next day. That next day the farmers from Njopeka village arrived at 5.00pm instead of 2.00pm with cassava flour and the buyer had already left. The farmers did not respect the contract, even if it was an informal contract. In the end the 2,000kg of cassava flour from Misasa and Njopeka stayed for a long time in a storage facility until it was sold in smaller quantities.The lesson was:
This failure was painful to us farmers but it was a learning point which improved our behaviour when engaging in a business relationship. Because the stock was finally sold in smaller quantities it was a lesson for Vredeseilanden and for the farmers that it is not necessary for us to target big buyers. We can also sell in our local market and earn the same amount of money with less risk of committing ourselves to deliver quantities which we will not be able to deliver on time. We are now very careful in dealing with buyers.
The second lesson was that in order to have a stable customer base we need to organise ourselves better in order to achieve deliveries on time and to deliver the desired quantity. The demand of cassava is very high at the moment and the prices are good. We believe that there is a good market for the product, but we need to respect the buyers’ requirements in terms of quantity, quality and delivery of the products. Indeed learning is a painful process but it pays at the end!!
Further:
Back to top
