Kenyan B2B eCommerce company Twiga Foods has invested $10 million to launch Twiga Fresh, a new subsidiary that is focused on modern and commercial farming, to help supply informal retailers and urban consumers with lower cost, better quality and safe food.
According to a statement, Twiga Fresh will scale the efficient production of domestic horticultural staples like onions, tomatoes and watermelons, significantly lowering the cost.
The investment in Kenya will make this one of the largest single horticultural farms in Africa, focused purely on the domestic market.
Twiga Fresh in the long term will be funded through debt in partnership with development financial institutions, focused on primary agriculture and food security, added the statement.
“We will continue to run the B2B e-commerce business under Twiga, focused on building a one-stop supply chain solution for informal retailers, delivering both Twiga and non-Twiga owned products. Twiga Fresh, in addition to our growing range of private label products, will ensure we drive growth in customer numbers and broaden the basket size by offering quality produce at a discount against prevailing market prices,” said Peter Njonjo, CEO and Co-Founder of Twiga.
“The commodity driven volatility in the world today is causing an unprecedented level of food inflation across the world. In Africa, we can least afford this disruption, and that is why we are excited about the imminent impact our technology-enabled supply chain will have in reducing the cost of food,” he added.
Over the past few years, Twiga Foods has been working to solve the problem of rising cost of food in urban areas. Food accounts for close to 60% of household expenditure across major cities in Africa.
The company says the last few months have been particularly difficult for the retail business and for consumers as disposable income has taken a beating from both the COVID pandemic and the increasing commodity inflation caused by the war in Ukraine.
Additionally, there is limited investment in revolutionizing the productivity and modernization of food production in Africa, which is leading to a significant growth in the importation of basic food, making food security an increasingly elusive goal.
Twiga is the first East African company nominated in the Times Top 100 Most Influential Companies 2022.
The company says it will remain committed to tackling the challenges of food security by using technology to deliver better quality and low-cost food.