Kenyan B2B E-Commerce startup Twiga Foods today launched a new subsidiary that is focused on modern and commercial farming. Known as Twiga Fresh, the new division will scale the efficient production of domestic horticultural staples like onions, tomatoes and watermelons making it one of the largest single horticultural farms in Africa, focused purely on the domestic market.
Twiga is investing $10M in Twiga Fresh and says in the long term it will be funded through debt in partnership with Development Financial Institutions, focused on primary agriculture and food security.
For specific value chains that are locally well established and efficient, like bananas, Twiga Foods says it will continue to work with small holder farmers in addressing the challenge of food security.
“We will continue to run the B2B e-commerce business under Twiga, focused on building a one-stop supply-chain solution for informal retailers, delivering both Twiga and non-Twiga owned products. Twiga Fresh, in addition to our growing range of private label products, will ensure we drive growth in customer numbers and broaden the basket size by offering quality produce at a discount against prevailing market prices,” said Peter Njonjo, CEO and Co-Founder of Twiga.
“The commodity-driven volatility in the world today is causing an unprecedented level of food inflation across the world. In Africa, we can least afford this disruption, and that is why we are excited about the imminent impact our technology-enabled supply chain will have in reducing the cost of food,” he added.
To launch the Twiga Fresh line of products, the company shall sample one million Kilograms of fresh produce to customers under our 21-day promotion by the name of “Bidhaa Freshi na Safi” that commences on the 23rd of May 2022. We shall deliver the produce at no cost to the door of every retailer who participates across the sixteen cities and towns we operate in Kenya. This will also help boost working capital in their businesses.
Over the past few years, Twiga has been working to solve the problem of rising cost of food in urban areas. Food accounts for close to 60% of household expenditure across major cities in Africa. The last few months have been particularly difficult for the retail business and for consumers as disposable income has taken a beating from both the COVID pandemic and the increasing commodity inflation caused by the war in Ukraine. Additionally, there is limited investment in revolutionizing the productivity and modernization of food production in Africa, which is leading to a significant growth in the importation of basic food, making food security an increasingly elusive goal.
In March, Twiga Foods announced that is targeting a pan-African expansion to East African markets like Uganda and Tanzania. The company also said it investing in developing an alternative way of producing food on the continent and covering both ends of traceability and mass scale. The initiative it says aims to reduce consumers’ prices for popular fresh food products by over 30%.