Background of the program
The Inclusive Resilience in Somalia (IRiS) Program Activity aims to accelerate economic development for marginalized households most affected by droughts and other shocks in targeted areas of geographical focal zone (GFZ). This will be done by increasing individual, household, business, community, and system-wide resilience through rural and urban livelihood diversification and promoting inclusive economic market systems.
The program will be implemented across targeted USAID’s Country Development Cooperation Strategy (CDCS) Focal Zones, IRiS works with a range of institutions and partners to deliver a suite of flexible and context-relevant interventions at Community, State, and Federal levels. This Activity will also align with Somalia’s development priorities which are captured in its National Development Plan 9 (NDP 9) covering 2020-2024. IRiS Program Consortium led by DT Global is a five-year program Funded by USAID/UKAID with Mercy Corps part of the program as per signed sub award agreement. The duration of the IRiS Program is from July 1st, 2022, to May 15th, 2027. The IRiS program is designed to use market system development (MSD) approach to strengthen the local market systems of the productive sectors including Fishery, Agriculture and Livestock to deliver long lasting system wide change targeting marginalized groups. The program is currently partnering with Malab dairy company, a private sector actor to deliver sustainable impact in the milk value chain and carry out other intervention complimentary activities. Under the IRiS program consortium Mercy Corps is leading in the implementation of livestock sector activities across the target GFZ of the program and minor components of Energy and financial services.
About Malab Dairy Company
Malab Dairy Company is a growing player in the dairy sector, specializing in the production of high-quality dairy products. With a strong commitment to delivering fresh and nutritious products to the market, Malab has established itself as a reliable source of dairy in the region. The company blends locally sourced milk with imported ingredients to maintain consistent production levels and meet the growing demand for its products.
Current Production
Malab Dairy currently produces approximately 1,500 cartons of yoghurt daily, offering various sizes including 500ml, 200ml, and 150ml to cater to different market segments. Though the company has market-tested cheese, it has yet to fully scale up its cheese production line.
Malab sources about 150 liters of milk from local outgrowers, while 350 liters are supplied from its own farm. To meet production needs, the remaining raw materials are imported skimmed milk, ensuring the company consistently meet its daily production targets.
Market Size
The company has a robust market for its products, with over 90% of its output consumed regularly. However, about 7.5% of production sometimes goes to waste, particularly during the slower months of June, July, and August. During these periods, any sour milk is churned into butter to minimize wastage and diversify product offerings.
Products
Malab Dairy’s product portfolio includes yoghurt in various sizes. While yoghurt remains the flagship product, the company continues to explore opportunities in expanding cheese production as part of its growth strategy especially fresh UHT (Ultra-High Temperature) milk, and cheese
Objective:
The primary objective of this Terms of Reference is to hire a dairy processing expert under the IRiS program’s livestock component. The expert will support Malab Dairy Company’s restructuring and growth by enhancing production efficiency, developing an expansion plan, and creating a comprehensive marketing strategy. The consultant will also assess Malab Dairy, competitive advantage and a leader among aggregators, and small-scale milk producers in its catchment area, improving Malab’s market positioning and operational understanding. Additionally, the expert will provide capacity-building support to boost operational efficiency and strengthen the milk value chain, fostering a sustainable and inclusive market system.
The specific objectives of this Terms of Reference include:
The consultant is expected to undertake the following tasks:
- To restructure Malab Dairy’s production processes by assessing current operations, identifying inefficiencies, and implementing best practices that optimize resource use, reduce waste, and improve overall productivity.
- To craft a comprehensive expansion strategy that enables Malab Dairy to grow its market presence, both geographically and through product diversification, based on in-depth market research and a detailed feasibility study.
- To develop and implement marketing strategies that enhance brand visibility, increase market share, and strengthen the company’s position within the dairy industry, utilizing both digital and traditional marketing channels.
- To identify skill gaps within Malab Dairy’s management and technical teams and provide targeted training to enhance operational expertise, leadership, and marketing capabilities, ensuring long-term business sustainability.
- To develop and implement Standard Operating Procedures (SOPs) across all critical functions, ensuring consistent quality, efficiency, and operational resilience in the company’s production, marketing, and management processes.
- To streamline Malab Dairy’s supply chain by improving procurement, transportation, and distribution practices, ensuring cost-effectiveness and reliability.
- To develop a financial forecasting model that evaluates the profitability and sustainability of scaling operations, providing the company with actionable insights for future investments.
- To establish a risk management and sustainability plan that addresses potential market fluctuations, supply chain risks, and operational disruptions, ensuring resilience and sustainable growth.
Deliverables: The consultant is expected to produce and deliver the following:
1. Production Structuring and Efficiency Plan:
- Current State Analysis: Conduct a detailed review of the current production processes, including an analysis of resource allocation, equipment usage, and supply chain management.
- Operational Efficiency Plan: Recommend steps to improve production efficiency, minimize waste, optimize the use of raw materials, and reduce costs.
- Capacity Utilization Assessment: Evaluate the current utilization of production capacity and provide recommendations to enhance it.
- Expansion Plan:
- Market Research: Conduct market research to identify opportunities for geographic expansion and new product lines.
- Scalability Blueprint: Develop a step-by-step expansion plan that includes the scalability of production processes, supply chain adaptations, and distribution models.
- Feasibility Study: Analyze the financial and operational feasibility of expanding into new markets, considering both local and export opportunities.
3. Marketing Strategy:
- Brand Positioning: Define clear brand positioning for Malab’s dairy products, differentiating them from competitors.
- Market Penetration Strategy: Craft strategies to increase market share, including pricing, promotions, partnerships with local retailers, and targeting institutional buyers like hotels or schools.
- Digital and Traditional Marketing Channels: Develop a comprehensive marketing plan that includes both digital (social media, e-commerce) and traditional (radio, billboards) marketing channels.
4. Capacity Strengthening of the Team:
- Training Needs Assessment: Conduct an assessment to identify skill gaps among management and technical staff.
- Targeted Training Programs: Deliver training in key areas like production management, dairy processing techniques, quality control, marketing, and financial management.
- Leadership Development: Implement leadership training for senior staff to improve decision-making, team management, and business growth strategies.
- SOPs and Manuals: Draft Standard Operating Procedures (SOPs) for all critical processes in production, marketing, and team management to ensure long-term sustainability.
5. Sustainability and Risk Mitigation Plan:
- Develop a plan to manage risks related to supply shortages, market volatility, and operational disruptions, ensuring the company can maintain its growth trajectory while addressing sustainability concerns.
6. Specifications of necessary machines/equipment/materials for the company and its aggregators.
7. Develop slide dec Presentations for Malab, MC and IRiS partners.
Consultancy Timeframe: The period of the consultancy is 45 days.
Consultant type required
Individual or Firm
Responsibility for Logistics arrangements and Costs
The company will be responsible for organizing logistical issues with no facilitation from Mercy Corps as per the consultancy agreement.
Taxation Provisions
Consultant shall be responsible for all Taxes arising from the consultancy in line with the Somalia Tax regulations applicable at the Mercy Corps Country office
Travel and accommodation requirements
Consultant will manage any travel and accommodation costs.
Security requirements
Consultant will be given full security briefing by Mercy Corps Safety and Security Manager/ Head of Office on signing of the contract. However, the consultant will be fully responsible for his security, movement and accommodation in Somalia during the consultancy period. He/ She will directly work with the sub-awardee Malab Dairy Company at its respective locations and will be expected to fully engage and comply with the company procedures and processes.
Knowledge and Experience:
- At least 5 years of experience in dairy processing, diary management and production chains.
- Proven experience in working with MSD programs in milk value chain development as well as small-scale milk producers’ integration.
- In-depth knowledge of dairy processing technologies, with a focus on yoghurt, cheese, and UHT milk production.
- Familiarity with best practices in managing raw milk supply chains, including sourcing from out growers and balancing imported ingredients.
- Expertise in implementing quality control measures and compliance with dairy industry standards (e.g., HACCP, ISO certifications).
- Strong understanding of food safety protocols and ensuring hygiene in the dairy production process.
- Ability to craft and implement an expansion plan for increasing production and market share.
- Experience in developing marketing strategies to promote new products, such as cheese, and enhancing the market positioning of existing products.
- Knowledge of market dynamics, including demand forecasting, market segmentation, and product pricing strategies.
- Skills in optimizing the supply chain for dairy raw materials, including managing relationships with out growers and ensuring efficient procurement of imported inputs.
- Ability to streamline sourcing, logistics, and inventory management to minimize production delays and reduce costs.
- Experience in designing and delivering capacity-strengthening programs for dairy production teams.
- Ability to mentor and train staff in technical production processes, business management, and quality control practices.
- Competency in fostering a collaborative and growth-oriented work environment within the company.
- Ability to conduct cost-benefit analysis for production scaling and the introduction of new products.
- Expertise in budgeting for dairy operations, including managing production costs, overhead, and marketing expenses.
- Experience in innovative dairy solutions, such as managing excess production through product diversification (e.g., converting sour milk into butter).
- Capacity to adapt production and marketing strategies based on seasonal variations in market demand.
- Knowledge of sustainability practices in dairy farming and processing, including energy-efficient technologies and waste management. (Biogas)
- Experience in integrating gender and social inclusion (GESI) strategies into business models, particularly in rural agricultural settings.
Applications should be submitted by 05:00PM EAT, 19th January 2025 to [email protected]
