A group in Solong Kandal wished to develop a small business plowing the fields utilizing a CHAD gift-loan to purchase a hand tractor. The hand tractor is easily hooked up to a plow or a cart for working the fields and transporting harvest or various other items. The first estimate of the cost of a machine and a cart was in the $2000 range, and the money they had collected as a group was roughly $245. Because CHAD only allows gift-loans of up to $1000, this meant that the group would need to find another way to obtain the remaining funds needed, such as to take another loan from a micro-finance institution or bank. Moreover, they didn't have a good understanding of whether their estimated income would be sufficient to pay off the machine.
Things were not looking good for this group. However, after hearing the initial proposal, we headed up to the church again for a second time in order to further examine the situation. We asked them questions pertaining to the structure of the business they intended to start. We told them that before making such investments it was important to study the environment in which the business would begin.
- This included the number of machines in the local area that also plowed fields for a fee.
- What prices were those machines charging?
- How much land did the group members themselves have that needed to be plowed?
- How many times a year did plowing occur? (Two times in this area, it turned out, because they farm near the river during the dry season.)
- How much land belonging to others would likely use the service of the group's new hand tractor?
- What other kinds of income-generating activities could they do with the hand tractor?
We also spoke of how competition affected pricing. I reminded the group of characteristics they could promote, such as quality of service, etc. This could give them advantages over the competition.
However, at the end of our long discussions, the numbers were still looking grim and there was much anxiety among the group members over the prospect of taking a loan from the bank, although the church owns a small rice paddy field that could be used as collateral. We told them that the CHAD program was adamant in keeping within its limits and in supporting groups to mobilize local resources for large projects like this one.
Later, the group called us back for another meeting, in which they shared with us some great news. They had reduced the start-up cost by nearly $500 by finding a shop with the best price and by themselves rebuilding a buffalo cart to be used by the new machine, rather than buying one. All that was required was $1765, $245 of which they had already collected. Moreover, they were going to borrow the remanding $520 from relatives, which they could pay back without interest. This was great news, because if they found their business in a rough patch, the bank could have potentially seized the church's small paddy field that they purchased last year with the harvest offering.
One great thing about paying off the CHAD gift-loan was that it would go into a savings pool to be returned to the group to start another development project. The group members were eager to take advantage of this aspect of the program and proceed with other projects, such as raising chickens.
After approval by the Social Concerns Committee of the Methodist Mission in Cambodia, their money was secured. Next would come the work of hammering out the by-laws. We wanted the group to be clear about the use of the money and also to develop a sense of unity, trust, and companionship as they took on a project providing a valuable service to the community.
May God allow it, I hope to one day return and see that the members of Salong Kendal have earned great success and are continuing on to further and extraordinary things.