The Butter Business Illusion

The Butter business illusion Anna Perinic – CEO StarShea ltd

© 2012 StarShea. All rights reserved. 2

How could women get a better share of the value ?

40 euros / kg 1 euros / kg (local market price)


The market is small and crowded

10% handcrafted butter

nut business,

90%

Most of the leading companies have already an integrated supply chain:

• Body Shop

• L’Occitane

• Yves Rocher

• René Furtherer

• …

Export in volumes nut equivalent

Women interested Prices


The real prices are not so attractive

2 US$ - FOB Tema

1,6 US$ FOB Tema

3.46

0.95

1.16

1,2

FLO minimum price

Export Lower range price

Export Higher range price

Local Market price

Unrefined Butter - price given to the women “Farmgate” US$/kg - Ghana


-

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

Fair Trade Costcalculation

Lower range Higher range FLO

Price offeredDepretiationLabourMillingCrushingWaterFuel / woodCost of nuts

The profit is low, especially if calculated on “fair trade method” ..

Prices given to the women: « Farmgate » - US$/kg

3,46

1,16 0,95

1,26

Cost per kg


You need to achieve : Quantity: full container load (gathering, federations, ..)

700 – 800 boxes

300 women – 3 weeks


You need to achieve Quality: FFA level, colour, smell, packaging, insects …:


Way out:

For export: –Brand the handcrafted –Get differentiation ? on a commodity market ? –Get organised and reach volumes –Reduce costs (how ??)

Otherwise:

–Sell on local markets –Do final products

Keep focus on quality nuts !!!! don’t dream about butter

The Butter Business Illusion

Business

Transcript of The Butter Business Illusion