3 steps to linking farmer livelihoods with business benefits

Alastair Stewart Food & livelihoods, Private sector

Often, livelihoods projects in smallholder-based supply chains – such as tea or cocoa – aim to create solutions that benefit all links in the chain: by addressing a challenge in the supply chain (e.g. crop productivity or quality) the projects aim to improve conditions for smallholder farmers (e.g. increased income) as well as for the buyers and commercial partners (e.g. improved quality or security of supply). But demonstrating this ‘win-win’ can be challenging as monitoring and evaluation systems need to be designed in a way that captures the benefits for farmers as well as their commercial partners.  

Using insights from Oxfam’s partnership programme with Unilever and the Ford Foundation, the Enhancing Livelihoods Fund (ELF), this blog explores how to become more strategic and deliberate about demonstrating a ‘win-win’ in partnership programmes. We argue that improved claritycommunication, and collection of data is needed, which in turn can make it easier for companies and NGOs to create internal buy-in to invest in or scale up smallholder livelihood projects. 

1. Clarify – knowing what the business drivers are, and how they link to the project  

A common assumption for livelihood projects is that if a problem is addressed at farmer level, this will lead “automatically” to palpable positive gains further up the value chain. For instance, in ELF, we promoted good agricultural practices in order to deliver better crop quality for suppliers (a so-called ‘business driver’) and improved incomes for smallholder farmers (a ‘development driver’). 

But one of the things we learned was how important it is to make these business drivers explicit and to clearly establish the theories of change and the assumptions behind them. If the effort is not made to explicitly clarify a business case upfront and how it relates to the development objectives, these drivers can quickly become lost in the complexity of day-to-day project implementation. The objectives of ELF’s livelihoods projects focused on the changes experienced by the smallholder producers. Did they adopt practices? Were women smallholder farmers able to participate meaningfully? Did farmers produce and earn more? These were all central project objectives. But, conversely, measuring the commercial objectives for the supplier were often deprioritized, were not on equal footing with the development objectives, or were not sufficiently advanced as the project went on. Did the crop quality improve? Did farmer loyalty go up? Did supply become more reliable?  

This shortcoming only became apparent towards the end of the project when decisions about scaling a project needed to be made and the business case was difficult to substantiate.  

A strong theory of change can help companies and NGOs to better map out assumptions and business drivers (e.g. crop quality), alongside the development objectives (e.g. farmer resilience) and the linkages between them (e.g. farmer behaviour change). With such a shared theory of change that considers development objectives and business drivers, projects are better equipped to test assumptions, clarify the business case, and ensure they are baked into project design.   


  • Build in time for theory of change and project design processes that define the commercial objectives of the project alongside development objectives; 
  • Make these commercial objectives actual objectives/targets of the projects, but be conscious of the timeframe and what’s realistically achievable.  

2. Communicate – ensuring all stakeholders fully understand the business case and what it’s got to do with them 

Clarifying and clearly articulating the business case is an important step. But it’s vital that it is shared among all project stakeholders, including those who may not be used to taking a business lens to a livelihoods project. Hence, ensuring that the theory of change and project design processes are done in an inclusive way that brings in the views and experiences of multiple stakeholders to establish a common understanding is critical. Regularly communicating the business case and updating it when necessary is another important step to ensure everyone involved is fully signed up.  This way we can make sure that every stakeholder understands the relevance of the objectives, buys into them and is working towards the same shared goals.  

Within one ELF project, there were differing perceptions of objectives and business case within a single company. Staff in the sourcing country were keen to understand factors affecting repayment rates for input loans. At the headquarter office, staff were focused on the potential for alternative crops to supplement income and therefore secure supply of a core crop. Although both objectives were relevant and valid, this divergence in understanding was challenging as it meant that at the end of the project, there was some debate over the project’s success, because there was no common agreement on what success lookeds like.  


  • Ensure that all relevant project stakeholders are involved in the design stage including commercial teams within suppliers and partners. 
  • Embed progress updates on the business objectives into regular catch-ups and discuss with all stakeholders to ensure these objectives remain relevant or if they need adapting as the project progresses.

3. Collect – building the evidence base to prove the business case is being achieved 

Any good project will have a monitoring, evaluation and learning (MEL) plan with a range of indicators relating to project objectives. These will ideally be from both a livelihood and business case perspective. Within ELF, many projects attempted to gather data on both aspects, with ambitions to measure things like yields, quality of the crops, and supplier-farmer relationships. 

However, we often found that there were difficulties in the collection of the required data to demonstrate whether the business case was being achieved. 

Why does this happen? Sometimes it’s due to implementing NGOs’ lack of experience in collecting business-related data as opposed to more “traditional” development or livelihood data. It may also be because some of the data around crop volumes and quality is commercially sensitive so suppliers are more reluctant to share. Or sometimes farmers don’t have the experience, resources or time to keep the detailed records required.  

Being as clear as possible up-front on data needs, is important: how it will be captured and collected, by whom, and whether capacity gaps exist that could hinder data collection. These are fairly standard steps for developing a MEL framework in livelihoods projects, but this may be more difficult to apply when a project is done partnership and business level indicators are collected in addition to livelihood data.  


  • During the design process, select some core indicators that link to business objectives. 
  • Discuss data requirements with all stakeholders. For hard-to-measure outcomes discuss what capacity gaps exist and what collaboration is needed between them to properly monitor outcomes (e.g. technical capacity from implementer for monitoring crop quality). 

Alastair Stewart


Ulrike Joras


Elen Newcombe-Ling