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Tuesday, August 19, 2008

Return on Investment

Mai Nalongo during the construction of the poultry house.
Many of her grandchildren are under her care.

One of the debates surrounding the poultry project had been whether we should recover the investment and if so, how.

For example, during the pilot, each household is getting an injection of 60,000 shillings (about US$ 40). (This excludes services provided voluntarily.)

Provided the pilot is successful, should the women:

  • return this amount to the project
  • pass it on to someone else
  • treat it as a donation
What we settled on was this: each household is expected to handover two mature (hybrid) hens which would be passed on to another household.

This is only a fraction of the value of the input. And the project itself will not recover any amount that is invested. Post pilot, the investment we are looking at is US$ 5000 (for 120 households). Not a small amount to simply give out.

So, how did we arrive at this? It came down to psychology (how people, in Buhugu in particular, relate to money and the management of finances) and logistics (what it would take to recover the input in bits and pieces).

Sure it is possible to design a project whereby the beneficiaries pay back the investment (with or without interest). But, given our understanding of the dynamics involved, we know, or feel strongly, that it will not work.

So, why go ahead with this? Well, because the return on investment, makes it a no-brainer. This project has the potential to:
  • increase household incomes which has a direct impact on the education, health and well being of especially the children
  • increase the protein intake especially of the household members (malnutrition is prevalent in Buhugu)
  • impart management skills to women
  • increase the information available within the community regarding poultry rearing

And it is our hope that once enough households are taking part in the project, neighbours and friends would take note and implement it themselves. After all, we are designing the project so that the monetary input necessary to get this going, per household, is as small as possible. But, perhaps we are getting ahead of ourselves. First let's see what the pilot turns up.

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