Alliances to strengthen business models and cooperatives

SMEs that invest and build long-term partnerships can develop unique avenues to stabilize their business model by helping to organize farmer communities, strengthening cooperative models of production, providing technical assistance, and creating the conditions for partners to invest in improving their agriculture production practices. The partnership also provides stability to the supply chain for the buying company by creating an avenue for cooperation, one based on a longer-term business view which can strengthen the resilience of the organization and community alike.

In Mexico, the coffee industry usually leaves its primary producer at a disadvantage due to the participation of intermediaries in the value chain and the establishment of the price of coffee by the New York stock exchange. This context is not foreign to the small producers of the Tacaná Volcano region, between the border of Chiapas and Guatemala, where the coffee producers sold the fruit of their labour to different buyers without any price regulation, thus perpetuating their conditions of vulnerability. In 2015, based on the need to find a safe buyer and sell at a better price, 140 small producers formed the Tacaná Organic Producers Cooperative thanks to the support of Restaurante Toks, a national chain of restaurants with their headquarters in Mexico city, which became a key ally for its development.

Productores Orgánicos del Tacaná were strengthened from an alliance with Restaurante Toks to develop a practice of fair trade, capacity development, and care for the environment through the cultivation of coffee. Under this alliance, Productores Orgánicos del Tacaná became a direct supplier of coffee to the Toks Restaurant chain without the need for intermediaries. This alliance was beneficial for both actors as it resolved Productores Orgánicos del Tacaná’s need for a secure buyer from the cooperative as well as Restaurante Toks’s need to offer a quality Mexican coffee that is free of agrochemicals and is friendly to the environment.

The Social Responsibility area is based on a corporate philosophy which prioritizes sustainability and promotes sustainable production models that benefit the community. Consequently, in the case of the coffee supply, they realized that a new, responsible, healthy supply chain directly from small producers was required. As a result of this alliance, community sustainability practices were strengthened in three areas: economically, through a financing agreement and payment in advance of coffee production which allows producers to earn a secure income; in the social, through the development of technical and soft productive skills to improve the physical and mental health of coffee producers, eradicate child labor, and promote the well-being of the community; and environmental, through the training and support for certification in organic production and environmental care.

Pathway maps represent the sequence businesses followed to implement successful sustainability practices and identify emerging ones within firms. The pathways also reveal the diversity of actors that begin to form sustainability enabling ecosystems for businesses to adopt, deploy or test sustainability practices.

They have used natural measures to protect production infrastructure. For example, to reduce the risk of the Roya plague, which is a fungus that grows behind the leaf due to humidity, shade is regulated. To prevent landslides, soil conservation techniques are used through living barriers and agrochemicals are avoided so as not to erode the soil. 

The close collaborations and shared value partnerships can enable more long-term disaster risk reduction practices designed for a specific community or economic activity. Also, the company and cooperative have individuals with unique knowledge of the local climate conditions and capable to testing new practices to adapt to climate or reduce risk from extreme weather events.