Input dealers using SMS to boost sales
Posted Wednesday, April 16 2014 at 01:00
Many agro-input dealers dealing in genuine products face challenges of competing with untrustworthy traders. This initiative offers a solution.
Selling various farm inputs, from seeds and tools to pesticides and fertiliser, is a growing business that an increasing number of people in Uganda are engaged in. But it is also a business fraught with counterfeits and unscrupluous traders, though there are also several traders who strictly deal in genuine products.
Ramula Madina is among the latter, she is a wholesaler based in Iganga, who deals in seeds for vegetables and cereals, plus fertilisers, pesticides and fungicides and other agro -chemicals.
Madina gets the genuine inputs direct from the manufacturers and trading companies like Pearl, NASECO and FICA and supplies to retailers and farmers. She also gives advice to clients on the best way to use the products for better yields.
To reach the customers and to alert her 89 regular clients, when the new stock arrives, she sends them phone messages (SMS).
She is part of the dealers involved in the SMS marketing initiative, which started in July 2012. It is about marketing genuine products to retailers and farmers, and also helps them to know where to get the stock and at what price.
The five-year project is supported by Usaid’s Feed the Future Agricultural Inputs Activity (FTF Ag-Inputs). It targets wholesalers because they are in a unique position in the agro-inputs chain, between the suppliers and retailers plus farmers on the other end.
The wholesalers are also trained on record keeping and financial management and also linked to banks, agro-input manufacturers and equipment suppliers, among others.
Madina not only sells products through the texts sent to customers but also sends them appreciations or reminders. Each message sent costs Shs28.
She also notes that before the initiative, she could only reach 24 clients using her mobile phone, which cost Shs130 per message. When she started using SMS marketing, her sales improved by 50 per cent.
“I started the business three years ago, I would not sell even 100 bags of fertiliser, for instance, in a season yet they were the most wanted by farmers. After adopting SMS marketing, my sales improved and I now sell more than 1,000 bags in a season,” Madina reveals.
“I not only use SMS but also advertise on radio because some farmers have no mobile phones but have radios. This has also increased the customer base. ”
She started with capital of Shs1.5m and raised it to Shs6m. Currently, she values the business at Shs30m inclusive of expenses.
The net profits have increased from Shs1m to Shs3m. If business goes well, in the next five years, Madina expects the net profit to hit Shs10m.
She points out customers who take long to pay or fail to clear their debts as a challenge in the day-to-day running of the business. This affects her business in that she cannot get fresh supplies since they are delivered after payment. Among her achievements, she cites the increased sales.
Ronald Byakika, a business growth specialist, FTF Ag-Inputs, whose work is to provide advice or solutions to business owners, explains that the project focuses on changing people’s mindset.
Instead of standing behind counters waiting for customers, they can actively engage in marketing and promotion by using SMS or radios in order to sell the products to farmers.