Portfolio Spotlight: Naasakle in Ghana

Above: Naasakle’s processing team in Damongo, Ghana.
Above: Naasakle’s processing team in Damongo, Ghana.

 

For generations, women in Northern Ghana have manually harvested and processed shea nuts into butter. Shea butter, often referred to as “women’s gold”, is used both as cooking oil in traditional Ghanaian dishes and as a natural cosmetic to be applied for healthy skin. The Global Shea Alliance, a nonprofit industry association, estimates that there are about sixteen million women working with shea across West Africa. Most of the shea nuts that are picked and transformed, however, are sold to middlemen and traders who buy when prices are low and resell when prices are high. Most women pickers must sell their products at whatever price is available at the time — they cannot afford to wait for higher prices, as their daily work is what puts food on the table for their families. As a result, many women often receive only a minimal share of the value created by their manual labor. However, at a time when global demand for natural shea butter and other shea products is booming — global demand for shea butter increased 1,200% between 2005 and 2015 — there are significant opportunities to bring much more value to these women.

Naasakle International LLC (Naasakle) is a family-owned, vertically integrated shea processing and marketing business that operates in Ghana and the United States, utilizing a direct “picker to consumer” model to connect Ghanaian women shea pickers with global consumer markets. The impact of Naasakle’s work is three-fold:

1. Economic Impact

  • Naasakle currently sources from more than 1,500 women pickers in the Damongo region of Northern Ghana.
  • These women are paid a 20-25% premium over the price usually paid by middlemen and traders.
  • Naasakle provides technical and financial literacy training, organizes savings programs, and pays for local warehousing facilities that allow women pickers to store and preserve the quality of their shea nuts to sell later in the harvest season when market prices are higher.

2. Employment Impact

  • Naasakle currently employs 45 people in Ghana, 35 of whom are located in Damongo, where formal employment opportunities are nearly non-existent.
  • Naasakle also provides health insurance and retirement contributions.
  • Most of the women working in the Damongo factory have been working with the company for several years, and loyalty is high.

3. Environmental Impact

  • Naasakle’s operations promote the careful upkeep of the region’s shea trees, which often provide the only tree-cover across an area that is vulnerable to desertification.
  • Shea trees are primarily responsible for helping to prevent wind erosion, and actively add organic matter back into the soil.

Founded in 2000 by Eugenia Akuete, a native Ghanaian woman, Naasakle aims to bridge the gap between pickers and global consumers and ensure higher incomes for women pickers. Eugenia migrated to the U.S. in 1979 with her family, and returned to Ghana more than two decades later, where she had the idea to start a shea processing business that accomplishes this goal. After scouting potential shea nut sourcing areas in Northern Ghana, she decided on the Damongo region for the quality of the shea nuts in the area, as well as the relative isolation of the village, which would mean less presence of middlemen. Eugenia decided to organize the pickers into cooperatives of about fifty women each, to provide the support needed to legally incorporate them, and to define with them a fair shea nut price that would include a premium and leave more value with the women. Early on, she also understood that in order to efficiently serve the international markets and ensure appropriate consistent quality, production of the butter could not rely on traditional methods but needed to be internalized and industrialized.

 

Above: A group of women shea nut pickers who work with Naasakle, part of a cooperative in the surroundings of Damongo.

 

Upon officially incorporating the company in Ghana in 2003, Eugenia started the sourcing of the nuts, built a small processing workshop in Damongo, and convinced her first buyers. With the help of hundreds of sustainably paid pickers and guidance from the United States Agency for International Development (USAID), she grew the business from less than 100 pounds a year to over 100 metric tons (approximately 2,204 lbs) a year. During this period, she also became the first president of the Global Shea Alliance and served on the President of Ghana’s steering committee for the shea butter industry. In 2015, Eugenia’s daughter, Naa-Sakle Akuete — a Harvard Business School graduate and the inspiration for the business’ name — joined her mother to take the reins of the family business. Whereas until then sales to international buyers had been performed directly from Ghana, Eugenia and Naa-Sakle decided to incorporate a US LLC to funnel wholesale sales through the U.S. and to launch and develop the retail sales of shea butter under the Eu’Genia brand.

Today, Naasakle is a fully integrated business that sources and processes shea nuts in Ghana through its fully-owned Ghanaian subsidiary, and sells shea butter to the U.S. There, shea butter is sold in bulk to wholesale clients under the Naasakle brand, while packaged shea butter is sold to the retail market under the Eu’Genia brand. The business is well-positioned for expansion, with a new processing facility recently opened in Accra that has the potential to significantly increase Naasakle’s processing and sales volume and employment opportunities.

In December 2017, MCE made a USD $300,000 loan to Naasakle, primarily for inventory financing, at a key moment in the company’s growth. This will allow the organization to purchase more shea nuts from local pickers to transform into shea butter and generate more than USD $1M in revenue. MCE’s loan has the potential to be highly catalytic for Naasakle, allowing the business to expand its operations, draw valuable equity injections in the future, and benefit even more Ghanaian women around the country.

 

Above: Fabrizio Cometto, MCE Portfolio Manager, with members of the Damongo processing team.

 

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