Mechanisation is one of the biggest problems facing Nigerian farmers. To help solve this problem, Nigerian tractor-on-demand company, Hello Tractor has signed a partnership deal with leading farm machinery maker, John Deere.
Asides bringing mechanised operations closer to farmers, the deal is also expected to establish John deere’s operations in Nigeria and other parts of Africa.
John Deere’s poor business in Africa
While Deere & Co is a global name in farm machinery, it has however struggled to make a mark in Africa. Of its annual revenue of about $40 billion, Africa, Asia, Australia, New Zealand and the Middle East together are responsible for just $3.9 billion of it.
This is quite puzzling especially because a region like africa appears to need mechanisation the most.
Nigeria alone needs 750,000 (more) tractors to be on the global average
Jehiel Oliver, Founder, Hello Tractor
Thus, meeting this demand and of course, growing its Nigerian and African market is a top reason why this partnership is very key for Deere & Co.
The leading farm machinery maker said it is currently testing out the tech developed by Hello Tractor on 400 of its tractors in Ghana and Kenya. Subsequently, the devices will be rolled out across the continent in the second part of the year.
“We would like to see that every farmer has access to mechanization. The gap that we’ve identified is, how do we connect small farmers with tractor owners.”
Jacques Taylor, Head of John Deere in sub-Saharan Africa
It is unclear, however, how much the company is putting into the project although it is optimistic about its success.
Hello Tractor’s tech and how it works
Hello Tractor started out with the intention of manufacturing low-cost tractors and then selling them to farmers to help mechanize their farming operations. Over time, the company has morphed into trading its technology to contractors like John Deere.
If you have booked a ride on any ride-hailing platform, then you will quickly understand how Hello Tractor’s tech works. It is an Uber for tractors. Farmers who need tractors to work on their farms do not have to buy one, they can instead book for a tractor with the app.
Beyond booking, the Agtech takes it a step further and monitors the tractors as they are being used on the farms. By doing this, it becomes possible to ensure that a tractor functions for the timeline it is supposed to. The device also detects damages as soon as they occur.
In doing this, Hello Tractor de-risks investing into the tractor business for banks, contractors and investors who want to purchase tractors and hire it out to those needing it.
The monitoring is done with a small black box fitted beneath the dashboard of every tractor registered with Hello Tractor. When a farmer books a tractor, the nearest available tractor is scheduled to arrive when the farmer needs it. So, essentially uber for tractors.
In partnering with Hello Tractor, John Deere will finally get the opportunity to break into the agricultural industry in Africa. The machinery making company has had setbacks in that area because majority of the farmers in the continent cannot afford tractors and some essential machinery made by Deere.
A model like Hello Tractor’s, therefore, gives John Deere the opportunity to provide tractors for hire, and not out-rightly depend on selling to farmers in the marketplace. Of course, this requires a huge investment with no clear cut guarantee of success.
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