Publications detail

Outgrower schemes: advantages of different business models for sustainable crop intensification

This learning note is part of the Investment Centre Division’s contribution to FAO’s Strategic Objective on Sustainable Intensification of Crop Production. It is an extract from a wider review of smallholder linkages for inclusive agribusiness development financed under the FAO/World Bank Cooperative Programme. The study reviews a range of collaborative business models (out-grower schemes, management contracts, joint ventures) assessing their advantages and disadvantages, the conditions under which they could develop and be sustainable, the roles of other stakeholders and their inclusiveness, and the fairness of the trading relationships they foster between smallholders and companies.

The learning note focuses on a successful example of rubber production in Ghana’s Western Region and a less successful example of sorghum production in the Ashanti Region. These illustrate two organizational business models: a nucleus plantation with an out-grower scheme (rubber); and the use of lead farmers. The note seeks to highlight the constraints and potentials of the two models and to provide useful lessons and insights regarding their contribution to promoting sustainable crop intensification.