Doselva builds a new supply chain for Central American coffee farmers

Central American coffee farmers have been hit hard in recent years by the impact of climate change and price volatility. With the drop in income, they have been looking for other sources, mainly cattle raising, in addition to the production of crops for their own subsistence. The problem is that these alternatives are not sustainable either for their livelihoods or the environment. With a significant portion of the world’s biodiversity located in Central America, it is particularly important to protect the region’s environment.

Five years ago, Jefferson Shriver launched Doselva, a social enterprise in Nicaragua and the United States, with the aim of solving this problem in a big way. A coffee producer with many years of NGO experience working with smallholder farmers, Shriver’s company offers Central American coffee growers a turkey solution. Specifically, not only does it help them grow botanical ingredients for spices to sell to the food industry, but it has also established a new sustainable supply chain system for processing and exporting these materials.

“This is a big problem and we needed to think of a big solution,” says Shriver.

Diversifying your crop

Shriver first learned about the potential of growing spice ingredients during his time working with smallholder farmers. He has observed coffee farmers in Madagascar, Uganda and elsewhere successfully supplementing their incomes by growing more profitable crops like vanilla and cinnamon.

Shriver, himself a coffee grower in Nicaragua since 2006, decided to diversify into turmeric, ginger and cardamom in 2012 when he realized he couldn’t survive on that crop alone. He started with vanilla, which he says is native to the region. “I fell in love with vanilla,” he says, although it was more of a love-hate relationship as the plant is difficult to grow. That’s because you have to manually pollinate the flowers. In addition, they are very sensitive to disease. Shriver then added turmeric, ginger and cardamom.

While in the process of his own diversification, Shriver began to think about the challenges smallholder coffee farmers faced and what he could do about them. “I realized that it could be more effective in the private sector to create a lasting solution to some of the big problems of our time – environmental destruction and rural poverty – with a focus on coffee farmers,” he says. In 2017, he founded Doselva.

an anchor

The company acts as what Shriver describes as an “anchor”, buying, processing and exporting the crops, which include vanilla, saffron, ginger and cardamom. But it also provides a range of services to farmers, ranging from technical assistance and transportation to help with the environmental and food safety certifications needed to sell to a premium market. And it provides farmers with organic fertilizer seeds and repellents to better improve their yields.

Annual contracts with farmers are defined at the beginning of the season. The company buys all the spices produced by the farmers; they usually work on about three to five acres of land. “This level of production makes buying the entire crop feasible,” says Shriver. The contract includes issues such as certifications, a range of prices farmers will be paid, and inputs such as organic fertilizer.

Farmers generally continue to grow coffee, a little less than before. As the harvests of the various spices take place after the end of the coffee season, the new crops provide not only more cash but also a margin of income during what used to be a period of inactivity.

Customers and Growth

The company sells mainly to supermarkets, in addition to nutritional supplement, beverage and table seasoning companies. About 40% of sales are from customers in the EU, 60% from the US

Currently, around 300 farmers participate. But Shriver expects that to more than triple by 2025. He also employs about 100 people at the company’s 15,000-square-foot processing plant on about five acres in Grenada. (Doselva has a lease-to-purchase agreement, and Shriver expects to acquire the facility later this year.) According to Shriver, more than 5,000 people a year will be impacted by his new supply chain system. “We’re creating an industry,” says Shriver. “With spices as an engine, it is creating job opportunities and income opportunities – with a spillover effect beyond the farmers who directly participate in our supply chain.” Farmers were able to triple or even quadruple their income, with crops more resistant to the impact of extreme weather than coffee, he says.

The company has also just launched the program in Honduras, focused on cardamom and all spices. Furthermore, Shriver predicts that potential competitors will see its success and try to emulate it, further spreading opportunities to the people of the region.

Mentoring at the Miller Center

In 2019, Shriver entered an acceleration program at the Miller Center for Social Entrepreneurship, where he worked with mentors. So when the pandemic hit, his mentors extended his guidance for another year. During this time, they also helped Shriver register as a Public Benefit Corporation and then establish a holding company based in the United States. Through the Miller Center Truss Fund, Shriver secured a $150,000 loan that provided much-needed working capital to purchase new equipment and received further guidance focused on investment readiness.

That money also served as catalyst capital, helping Shriver raise more stock and debt from other investors. “When entrepreneurs need funding and other institutional investors may be hesitant, we can invest first and send a signal to the rest of the ecosystem that we have confidence in that entrepreneur,” says Alexander Pan, director of impact investing at the Miller Center.

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