Overview Research shows that lack of access to quality inputs – such as feed, micronutrients, seed, and information – continues to present a major bottleneck in the production of both agricultural and non-agricultural rural SME products in Bangladesh. To improve this, Katalyst established rural distribution as a cross-sector, targeting a large number of rural farmers and producers involved in agro- and home-based, small scale non-farm production.

As the private sector input providers do not currently have sufficient economies of scale to operate in deeply rural areas, their presence at this level is minimal. This results in the creation and dominance of low quality input providers, along with a prevalence of inaccurate information around products and their use.  It is no surprise that inefficiencies among farmers and producers result. Katalyst has identified distribution companies to take the lead in helping quality input companies to distribute their products to rural clients in a cost-effective way.

Once such a system is in place, it will assist rural farmers and producers to access quality inputs and thus achieve higher productivity and yield. At the same time, this development will offer private sector companies involved in input marketing the right incentives to invest, and help achieve fair economies of scale. The main goal under this cross sector is to increase the income of small and marginal farmers, with special attention given to women engaged in homestead production in rural areas.

Katalyst's Strategy

Through its interventions in rural distribution, Katalyst aims to assist in developing a competitive rural, client-focused, distribution service market. Once this is operational, agro-input organizations can cater more efficiently to the needs of rural clients.

Intervention Areas

• Building capacities of existing and potential professionals working in rural markets
  
  In 2009, Katalyst initated a dialogue between selected Dhaka universities and leading agro input houses. The parties involved identified the need to introduce a course to improve understanding of rural markets. Katalyst then partnered with two leading private universities, Eastern University and American Internation University, Bangladesh (AIUB) and helped them to introduce a rural marketing course as part of their business curriculum. This course started in early 2010 and till end of 2010 around 300 or more students have completed it. Discussion is now underway with two public universities, Jahangirnagar and the University of Chittagong, to incorporate the same course. Katalyst believes that through increasing knowledge in this field, the information gap between rural clients and input companies can be minimized, allowing input suppliers to cater for their rural clients more efficiently.
  
• Assisting in increasing the availability of rural market information for agro input companies
  
  Katalyst has partnered with leading global research organization Nielsen, working together to develop a retail audit product designed to enable agro input companies to better understand client demand and plan accordingly. Katalyst expects this to lead to rural producers receiving the inputs they require in a timely, efficient and sustained manner.
  
• Facilitating the development of a last mile distribution model to increase the reach of inputs and information
  
  Katalyst has partnered with Market Express, a large distributor with nationwide access, to launch a pilot intervention involving door-to-door sales (of both agro inputs and consumer goods) in Khulna. Katalyst expects that such a distribution model will facilitate greater access of quality inputs to small and marginal farmers and homestead producers. Once the pilot proves successful, Katalyst plans to work with several partners to scale it up nationwide.

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