Background

Classic Foods: Value Addition for Improved Livelihoods

Ten years ago, Kenyan accountant, WachiraKariuki, quit his career, and together with Stella Kimemia started Classic Foods for the purpose of buying and selling milk in bulk from farmers to processors in the Nyeri area of Central Kenya. “They  started Classic Foods in 2007 and aimed at  helping farmers to have access to market and overcome effects of glut”, says Wachira.

They had identified a problem where farmers, including their own parents, were getting underpaid for their milk by middle men, and when there was a lot of milk in the market, there was plenty of wastage. “We would milk the cows at 3am only to get to the dairy and find out that they won’t buy that day because there was a glut. Sometimes we’d be told to take the milk back home, yet that was an income the family needed. It occurred to me then, that there was a need to liberate the milk industry. So the dream was installed by that pain of having to look for alternative markets to sell our milk,” says Wachira.

To solve this problem, they decided to organize farmers into cooperatives, buy their milk collectively, and market it to large dairy processors in the region. This served to ensure that the farmers always had market for their produce, and at good prices, due to the collective bargaining power of the cooperatives.

As the milk trading business continued to grow, and as more and more farmers begun to sell their milk to Classic Foods due to the better prices the company paid, the need arose for Classic Foods to begin processing the milk themselves, as there was often a glut with processors being unable to buy all the milk to due increased supply. Therefore, in 2009, Classic Foods, was transformed from a milk trader to a dairy processor, producing pasteurized milk as well as long life milk and yoghurt.

To separate the core business of Classic Foods from the work with the cooperatives, Classic Foods set up a non-profit called Enhance Business Solutions, whose sole function is to work with farmer cooperatives in the areas of capacity building, farmer training, and providing farm inputs in the form of fertilizers and seeds.

Today, Classic Foods continues to grow organically in response to challenges faced in the food supply chain.

Capital 4 Development has partnered with Classic Foods in its next phase of growth, which involves the construction of a camel milk processing facility in Isiolo, central Kenya. By processing raw camel milk for farmers in the region, Classic Foods aims to give these farmers access to market, and to help them comply with local regulations that require all milk transported to be processed.

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