Youth Entrepreneurship in Ethiopia

 

For the past 10 years, Amin Mohamed was one of the many unemployed youth of Ethiopia. In September of 2018, he was recruited as a PICS bags Youth Reseller in Goma woreda to distribute and retail PICS bags in the area. He was trained on how to use a PICS bag through a partnership between USAID Feed the Future Value Chain Activity and Shayashone PLC. In one year, Amin has distributed over 9,000 PICS bags with a margin of 5 birr per bag. With his earnings, he has been able to support his five family members and purchase his own home.

Unemployment in Ethiopia is a major problem, particularly in urban areas, where the rate approaches 15 per- cent. Because of high unemployment, Ethiopian youth (aged 15 – 24) are faced with grim prospects. They face many challenges and are susceptible to substance abuse. The migration of youth, in search of better prospects, from Ethiopia to Europe and the Middle East is a major concern for the government. PICS has found a way to offer much better opportunities to the youth in Ethio- pia. An innovative program initiated in Ethiopia to engage the youth in the promotion and sale of PICS bags has opened a new path for young people to pursue a better future 

PICS bags are manufactured in Addis Ababa, the capital of Ethiopia. From there, the bags are distributed in small regional cities throughout the country. Unfortunately, farmers from rural areas often do not have good access to the urban markets and find it difficult, if not impossible, to travel into the larger city markets. This resulted in low sales of PICS bags as vendors only sell to a limited number of buyers near urban centers. This, in turn, affects the overall cost of the bags which becomes more expensive due to low turnover. The low turnover and higher prices further impede the ability of urban vendors to reach farmers in rural areas with PICS bags.

To address the problem, Shayashone, a PICS distributor in Ethiopia, began an initiative to engage the youth in PICS bag distribution. Initially, three vendors were involved in selecting five youths to be trained by Shayashone. Shayashone provided technical and business training to these youth including the proper use of the PICS bag, as well as the marketing of the technology to rural farmers in villages and weekly markets. The idea was that each youth would travel out into villages and rural markets with a stock of PICS bags, perform small demonstrations, answer questions, and have the bags on hand to sell to interested farmers. The initial trial went very well and soon led to scaling up to 15 vendors with 5 resellers each (75 youth resellers).

 

An unexpected side effect of this process was the vendors who recruited the youth became promoters of PICS bags. This youth initiative helped to spread the word and led to the bags penetrating into the hard-to-reach areas of the country and to increased awareness. The project has been so successful that by February 2019, 187 youth resellers had been trained in the PICS bag technology, with 120 actively selling bags. Three years ago, out of 150 vendors, only 60 purchased PICS bags for resale. Today that number is now 150 out of 150. Vol- ume per vendor has gone up so that they are positioned to sell 500 – 1,000 bags per market in just 2 – 3 years.

A single youth reseller can sell up to 200 bags in one day during the peak season, making about $32 (USD). Working only 2 – 3 days a week, a reseller can make approximately the average salary for Ethiopia, which is 9060 ETB per month ($315 USD). Shayashone plans to expand the youth reseller model in the future and further spread PICS bags awareness across the most remote areas of Ethiopia. This model will not only benefit the rural farmers as they gain access to the PICS technology, it will also provide a sorely needed opportunity for the country’s vulnerable youth.