In the last decade, Kampala has been booming as an innovation and start-up business hub. Now, the COVID-19 crisis and its confinement measures are forcing businesses to adapt their models. A game changer is the online market for food delivery created by the Kampala Capital City Authority to de-congest food markets. But how are companies dealing with a drastically changed environment? Let’s have a closer look at one of those innovative companies in the food industry: Bringo Fresh.
Bringo Fresh is a food delivery company that helps farmers & families to reduce food waste and enhance their nutrition. They buy fresh fruits and vegetables, as well as meat, bakery goods and dairy products from 1500 family farmers who practice greenhouse farming, urban farming and mixed farming in and around Kampala. Consumers in Kampala, Wakiso and Entebbe can then they buy these fresh products on their website and get them delivered to their doorstep.
During the COVID-19 pandemic, city dwellers more than ever need food delivery services like the ones offered by Bringo Fresh. The government has directed people to stay at home and use food delivery services. The demand for deliveries has therefore gone up exponentially overnight. This opportunity for growth does not come without challenges for Bringo Fresh. The Government of Uganda has limited the freedom of movement to address the COVID-19 crisis. There is a 2pm curfew on motorcycle deliveries, which is the company’s primary mode of delivery. But that is not the only challenge: The reduction in the use of cash due to the fear of spreading the virus has led to a high dependence on electronic payments, which are often delayed. Lastly, the cost burden of stocking inventory for an ever-increasing amount of orders has increased rapidly.
Boom or bust? Good news: Bringo Fresh is booming! The amount of people buying their fresh fruit and vegetables has increased with 30%! With Ugandans staying at home during the Covid-19 lock down, Bringo Fresh expanded their services to districts around Kampala to reach many more people.
Rikolto facilitated this success through a small business loan. With the loan already paid back, Bringo Fresh is now looking for additional financial support to expand even more and explore a franchise model. This would enable even more Ugandans to benefit from the services Bringo Fresh offers.
Luckily, every cloud has a silver lining: Business is booming because of the rapid increase in orders. Bringo Fresh is now able to support more farmers as they can make bulk orders and have them delivered directly to the warehouse, fresh from the farms. In a time when most motorcycle drivers are prevented by the Government to carry passengers, their main purpose, Bringo Fresh is hiring more motorcycle riders to deliver boxes. It also forces the company to innovate in many ways, from using technology to manage inventory flows to advertising the company through social media platforms. There is only one certainty: Adjustments must be made daily to keep up.
“Mobile payments from the food delivery orders come through only several days after Bringo Fresh has paid the farmers upfront for their produce. Because of the increase in orders, this financial gap has widened and needs to be bridged.”
Peter Businda
Agribusiness Advisor - Rikolto
To continue adjusting and to face the cash flow challenge, Bringo is now looking for extra working capital. This would enable them to keep on paying farmers on time and deliver orders within 24 hours. Through partnerships with companies like “Safe Boda”, Bringo Fresh will deliver 1000 orders every week with a good profit margin. Rikolto will support Bringo Fresh in finding the necessary funds and already provide a short-term loan to keep up the deliveries of safe and nutritious food during the COVID-19 pandemic and beyond.
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