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BAPA is conducting a project targeting the capacity building of target agro-processing clusters of Bangladesh through enhancing ‘Entrepreneurial Ability’ and ‘Technical Skills’ in order to enhance the strength of the agro-processing sector. For the project, it was necessary to collect the base line information of the selected agro-processing clusters. The objective of the study was to carry out a comprehensive baseline survey in the project areas of Agro Food Processing Sector of Dhaka-Savar-Gazipur, Narayangang-Munshiganj, Rajshahi-Bogra-Pabna-Natore, Hill Tracts (tribal) and Chittagong area in Bangladesh to generate first hand information to be used for Project Planning Monitoring and Evaluation.

To conduct the study, both the primary and secondary data were collected. Extensive desk study was conducted after collecting related available documents from web sites, related all public sector, private sector and NGOs. This study was planned to have more information on the existing status on cluster SMEs’ entrepreneurship ability, sales, jobs, priority occupations, skill gap, product range, export, attitude towards social responsibility and gender sensitivity etc. which would help to get information about the present situation of SMEs to compare the targets achieved during midterm and final evaluation for impact analysis. A questionnaire was prepared. The data collection tools were used to capture crosscutting issues particularly gender and minority accountability to the entrepreneurship business. The tools developed was pre-tested to ensure that enumerators and the study population alike have the same understanding of the study topics, and was duly revised based on identified shortcomings.

The project target areas were clustered geographically into the four regions as stated above where the survey was conducted. 50 Samples was drawn from the four regions.  The respondents comprised agro-processors of 3 categories – medium, small and micro level agro-processing enterprises. The prepared questionnaire was used to collect the primary data. The qualitative study was collected using Key Informants’ Interview. Field data collection was implemented by enumerators from target regions of origin.  Applicable tabular analysis technique was used to analyze data. A list of 10 prominent/ concerned people was prepared and interviewed through a structured checklist.

The desk study covered the information on the existing overall situation of the agro-processing MSMEs of Bangladesh.

The baseline survey incorporates survey and interview findings. Specific observations are made by the survey team which are as follows:

• Among the respondent surveyed 26% limited company, 67% proprietorship and 7% partnership business were found. Only 47% of them is registered. Fifty per cent of them are aware of benefit of registering. Only 3% of the respondents are registered with BMET. A considerable portion of the respondents does have neither have an idea about registration nor aware about the benefit of registration
• Thirty eight percent of the agro-processors under the survey (38%) is involved in their trade organization. The respondents are involved in various trade organizations like BAPA, BFVAPEA, relevant Chamber of Commerce, BAPMA, BFFEA, BABMA etc.  
• Among the respondent surveyed, 44% has BSTI Certification. Only 8 percent of the total agro-processors feeling difficulties in going to BSTI. Sixty four per cent of them are putting code in their products. Among the respondents, 62 % are providing the necessary info i.e., date of manufacture and expiry, ingredients, retail price etc on their product’s label.
• In the survey program it was observed that, 82% of the respondent accomplishes the business plan. Majority of the processors have long term business experience, but there is lacking in technical knowhow especially on processing and quality control aspects.
• Forty six percent of processors are lacking knowledge on productivity tool. 47% are aware of productivity. Among the productivity tools, 36%, 20% and 4% of the processors under survey are using TQM, JIT and 3S productivity tools respectively. Only 2% of the total agro-processors are using 5S, KAIZEN and LEAN methods of productivity tools. The average production per day is 16.5 MT, current average production duration per day is 11.2 hours and the current average production days per year is 271 days among the processors under the survey
• Among the agro-processors under the survey, only 16% respondents are managing loan from bank or other financial institutions with the interest rate of 13-20%. The loan amount in cases of the medium scale enterprises varies from taka 400.00 to 1800.00 Lac especially. The payable amount of these enterprises varies from 200.00 to 300.00 Lac and the outstanding credit varies from 200.00 to 1500.00 Lac. The credit period varies from 2 months to 4 years.
• On an average 42 persons are employed at the agro-processing enterprises under the survey. The ratio of male and female were observed as 53:20. Average monthly gross salary of the employees was found as Tk. 7629.00.
• It was observed that biscuits, froze fish/vegetable/snacks, cake and other bakery /confectionery item, spices, chips, kurkura stands at the 5 priority having higher potentiality.
• Employment generation has been created for tribals and minorities and there is also potentialities of expansion of their employment in the area where high potentialities are prevailing for agro-processing industries.
• In 30% case, female workers are getting less salary than that are paid to the male workers. There is one exception where female workers are getting comparatively more wages than the males.
• Among the surveyed processors, 52% enterprise has the activities in relation to social responsibilities. The activities covers donation to Mosque, Madrasha, poor people, women having no ability to do work, in building the Temple, poor and meritorious student,  helping medical care, charity foundation, primary education & orphan child care, disaster support to victim person etc.
• Comprising all the categories the production of the 50 enterprises was found to be of 29039 MT, the factory sale prices of which was Tk. 30729 The highest production was observed in the Spices powder industries and it was 5043 MT.
• Average cost and return from business for the last 3 years (2011, 2012 and 2013 were analysed for the enterprises under survey. A gradual increase in production from the year 2011 to 2013. The profitability is not in a stable condition as it decreases in the year 2012.
• It was found that, 27% and 46% of the respondents collect their raw materials through supplier and by own employees. The rest of the processors (27%) collect their raw materials by both means i.e., through supplier and by own employees.
• This amount of postharvest loss may be reduced to a great extent if proper handling, packaging and transportation and improved processing technologies are applied.
• It was observed that 14% and 4% enterprises are HACCP compliant and ISO certified respectively. Also, a number of the respondents are trying for the certificates. Only 30% of the enterprises hold the certificate of BSTI. There are some barriers they feel in getting the certificate such as lack of knowledge regarding the issues and the complexity of the systems/methodology.
• Thirty four per cent entrepreneurs are fully satisfied with the existing product formulation but 66% wants improved formulation form an institution.
• Only 2% respondents use the waste water treatment plant for their factory and rest of the respondents are facing problem from the community for waste products. Nobody use the waste material to prepare compost, although a valuable organic fertilizer can be prepared from the waste material. Usually, what they are disposing the waste either in the dust bean or keeping it in hole made in the ground nearby the factory. Also, some are using the waste material as fuel.
• The major constraints faced by them are: workers have no knowledge on modern production, processing and packaging, shortage of skill technical personnel and appropriate mechanism, lacking HACCP, ISO (9001) & Halal certificate, lack of efficient marketing personnel , difficult to access export market
• Training needs on soft skills and technical skills were assessed for the agro-processors under the survey with the grade points starting from 1 (as very low) to 5 (as very high), the highest score (4.0) was in the cases of entrepreneurship and marketing, followed by team-building and computer and IT. in case of technical skill need assessment, highest score (4.0) was observed for chemistry, followed by bread, biscuit and bakery.

The specific constraints observed from the key informants’ interview which are mostly concerned with the project are as follows:

• Technological weakness like lack of improved formulation and skill of the manpower in the industrial system
• Lack of sufficient training facilities for the production and quality control personnel of agro-processing industries
• Organizational business promotional activity is poor due to lack of sufficient institutional support
• Agro-processing sector usually lacking quality assurance system and proper post-harvest handling system due to which, a huge amount of crops especially the perishable crops are lost every year. In case of fruits and vegetables, post-harvest loss occurs about 20-40% during their handling and transportation.
• Sanitary and phyto-sanitary system are poor at the field of agricultural crop production
• Proper supply/value chain system is not established
• Lack of pilot plant for training to the industrial personnel
• Attempt for export market promotion is not sufficient.

On the basis of the study findings, the following major re commendations are made:

• Interventions on facilitations are required to their institutional development through capacity strengthening.
• interventions are necessary to encourage in registration.
• It is indeed, necessary to make aware on the benefit of involvement with the trade organization.
• There is huge knowledge gap on business planning which should be reduced through undertaking proper training programmes for them.
• It is urgently required to increase their knowledge on productivity tools as well as proper production management
• Facilitation is highly required to encourage more participation of women.
• Biscuits, frozen fish/vegetable/snacks, cake and other bakery/confectionery item, spices, chips, kurkura stand as the top 5 priority trade/occupations, which should be given more emphasis in sector development
• The present employment generation has been created for tribal and minorities and there are also potentialities of expansion of their employment in the area where high potentialities are prevailing for agro-processing industries. Therefore, these aspects should be given more importance.
• Interventions are necessary to address the carrier recognition issue towards uniformity.
• Finally processing vegetables into frozen condition, production of frozen snacks (alupuri, samusa, shingara etc.) are introducing and demand is day by day increasing. Therefore, intervention may be undertaken to develop this types of enterprises as well as the concerned value chain.
• Relevant training programme and interventions should be undertaken to improve the food safety and quality control status throughout the food supply chain.
• Intervention is required at the industry level on improved handling practices and quality control system during the unit operations of processing activities in order to reduce the losses of the perishable commodities.
• Facilitation is necessary to remove the barriers in getting the certificate of standardization (BSTI, ISO, HACCP etc.) such as lack of knowledge regarding the issues and the complexity of the systems/methodology.
• It is necessary to create awareness among the entrepreneurs in incorporating food technologist in their enterprises towards better performances of the enterprises.
• Training needs for agro processing entrepreneurs in detailed on overall management and production management, food safety, assessment of market demand & supply, processing, product packaging and packaging machinery, new technology & how to operate machineries, maintaining food quality, manufacturing operation, product buying & quality, grading and marketing, market management, product development, export marketing & transaction, business development, food quality & strategy, latest development of food technology.

Finally, the interventions on increasing cluster SMEs’ level of entrepreneurship ability, productivity, job opportunities, emphasis on priority occupations, skill of the factory personnel, product range, export, positive attitude towards social responsibility and gender sensitivity will make a positive change in the agro-processing subsector of the country.