AAF SME Fund Impact: Norish

Business Challenge

Norish is a food processing (FAMIX) and animal feed company located in Addis Ababa, Ethiopia. It is the largest FAMIX in the country with installed capacity of 30,000 metric tonnes. It is also one of the largest animal feed producers in the country with capacity of +/- 10,000 tonnes. Its main product is Supercereal, which has three product categories: Corn Soya Blend (CSB), CSB+ and CSB++.

Norish’s sales from food processing were dependent on orders from large donor agencies and the company was operating at high costs, at 30% of its installed capacity. The company had 8 non-operating silos and was therefore unable to purchase raw materials in bulk during harvest season for use during the dry season.

Our Approach

The AAF SME Fund committed $4m to Norish in March 2015. This went to finance land and buildings, silo refurbishments, plant and equipment and vehicles to improve efficiency and effectiveness of operations. About 60% of the funds went to finance working capital – purchasing of inputs, payroll, marketing and promotion. The Fund is also taking steps to re-align the company’s strategy towards a more commercial approach and expand its existing customer base.

Our Impact

Improved Livelihoods

Rolling out a Smallholder Support Scheme worth €323,000 to increase the income of about 800 to 1,000 smallholder farmers linked to Norish by 20%. Through Agronomic training these farmers get to increase agricultural production volumes by 25%
42 jobs have been sustained with 100% of roles permanent
Post-acquisition has delivered close to 5,000 tonnes of CSB, through government programmes, in response to the current drought needs

Enhanced Food Security

7.6m people are considered chronically food insecure in Ethiopia, and an additional 6.4m people are unable to meet their food needs. Through the Fund’s working capital injection, the company has fed close to 140,000 people, within a year of acquisition
With support from the fund, Norish is fulfilling its mission of reducing malnutrition through supplementary feeding programs with WFP
Planned expansion with commercial products to increase the company’s reach across different social classes

Improved Business Operations

Bulk infrastructure improvement, including factory plant refurbishment, resulting in increased operational efficiencies
Engaging technical experts to assist with upgrade of the silos to allow storage of inputs during harvest season at moderate cost
Automating product handling processes for increased efficiency
With TAF assistance of €84,000, the Fund assisted Norish to develop a corporate transformation plan that structures Norish as a commercial FMCG entity beyond NGO clients
Implementing HACCP compliance; with WFP accreditation and ISO certification completed in order to minimise food safety hazards
Procurement of food testing equipment

ESG Impact

Food safety management system – ISO 22000 certification thereby minimising food safety hazards
Water reticulation improvements – water preservation and reduction of water contamination
Procurement of food quality testing equipment – pre and post production testing e.g. salmonella, aflatoxins, E.coli etc
Product shelf life compliance standards