One of the aims of Public-Private-Producer-Partnerships (4Ps) is to build profitable business cases which can leverage external financing. In vision paper 1, Towards Finance Ready Business Cases, we looked at the need for capacity building support to let 4P partners become finance ready. In vision paper 2, Bridging the inclusive finance gap, we focused on the gap between the demand and supply for financing from agricultural SMEs. We provided suggestions to close that gap.
Today, SNV launches the third, final paper based on the Partnering for Value project. We provide insights and recommendations for continued support after an investment deal has been signed, to ensure that a return on investment materialises in practice.
After a business case has been created and has been able to attract financing from external parties, the producers and private partners often need continued support, at least for the first few agricultural seasons, to ensure the success of the business case.
A proper business case provides an outline of steps that the partners will take to improve their capacities, increase agricultural yields and the quality of the end-product. As outlined in paper 1 and 2, several steps will need to be taken before a 4P arrangement is ready for financing and investments can be made. Our experience in the Partnering for Value project shows that support is also needed for the 4P partners after a financing deal has been signed to realise the proper implementation of the entire business plan; partners often need support to ensure equitable implementation of the plan, so that private as well as producer partners can enjoy the benefits of capacity building and the 4P is governed with the full participation of all partners. In this third paper, we explain what type of capacity building is most effective to let 4Ps become a success, how support can be provided and a practical return on investment can be realised.
The full paper Securing a Return on Investment with Capacity Building Support using 4P is available for download.