A. Background

In 2018, the Mongolia Green economy barometer suggests that if 4% of GDP were invested in the green economy, by 2030 Mongolia could cut greenhouse gas emissions by 20%, generate 30% more real GDP per capita and accelerate poverty reduction by three thirds. While different reports and global indexes suggest that Mongolia is a leader in legislative commitments to a green economy, the actual implementation process remains the main challenge. Many of the challenges are directly connected to the production patterns of the largest industries in the country. One of the most significant ones is the agri-food and beverage sector, which represents 31.2% of national GDP and generates much of Mongolia’s employment (World Bank, 2019). Due to its size and predominant focus on maximizing economic returns, the sector is known to leave behind a significant environmental footprint, greenhouse gas emissions, and waste. To reduce the environmental impact and encourage the adoption of circular economy practices across the sector, the Mongolian Ministry of Food, Agriculture and Light Industry has set as a target that, by 2030, 5% of the entire agri-food production would be labeled and certified as organic.

Development Solutions (DS) is co-implementing the “Switching on the Green Economy” project funded by the European Union (SWITCH-Asia programme), along with three project partners: People in Need (PIN), Caritas Czech Republic (CCR) and Mongolian Sustainable Finance Association (MSFA) in Ulaanbaatar, Erdenet city and Selenge provinces. The project aims to contribute to a progressive transition to a low-carbon, resource-efficient circular economy and accelerated poverty reduction in Mongolia. Micro, small and medium enterprises (MSMEs) and retailers will benefit from uniform  green labeling standards and policy framework and will be supported to adopt green labelling as well as to introduce circular economy practices as the result of the project. Furthermore, a new online certification platform will be in place to facilitate fair and transparent green certification of MSMEs and retailers. To adequately integrate finance solutions, green labelling will be integrated with the existing digital payment products and scaled up. To promote and raise awareness about green certification with green labelling amongst MSMEs, retailers, Business Associations and other relevant stakeholders, a large behavior change campaign and awareness raising events will take place.

As the project will provide various technical assistance; organize various capacity building sessions and mentorship programs for agri-food MSMEs, business associations and retailers on green labelling, circular economy practices; and develop green labelling standards and standard operating procedures (SOPs), it is a priority to conduct an in-depth assessment.

B. Objective and Scope of work

The objectiveof this assignment is to identify the current level of understanding and capacities of agri-food and beverage sector MSMEs, business associations, and retailers on green labelling, circular economy practices (energy, water, and resource efficient practices, use of transport, use of packaging, food waste, etc.) and recommend the most potential sub-sectors to adopt green labelling, circular economy and sustainable business practices.

Scope of work

The scope of the in-depth assessment aims to assess about 600 MSMEs, 30 business associations and 300 retailers of agri-food and beverage (non-alcohol) sector excluding meat, dairy and poultry sector and identify the needs and gaps to introduce the circular economy practices. The assessment should include both quantitative and qualitative data of agri-food and beverage sector MSMEs, business associations and retailers in Ulaanbaatar, Erdenet city and Selenge province, including well-known and unknown target groups to discover new linkage, their organizational capacity and gaps in adopting circular economy practices and green labelling, etc.

Based on the assessment result, the project partners will develop a strategy for technical assistance and curriculum for accelerator and mentorship programs for MSMEs, business associations, cooperatives and retailers to introduce green/circular business models, sustainable business practices, environmental management, financial management of green business and green value chain practice. The specific tasks and activities expected are outlined below:

TASK 1: Agri-food and beverage sector market assessment

• Examine the agri-food and beverage businesses, legal status, structure, and human resource capabilities of MSMEs in Ulaanbaatar, Erdenet city and Selenge province;
• Conduct research on the current situation of the agri-food and beverage sector and sub-sector, e.g. suppliers, agriculture and agricultural processors, manufacturers, producers, wholesale and retail traders;
• Identify agri-food and beverage sectors and sub-sector with higher growth potential with level of green business;
• Analyze and identify gaps for production, agricultural extension, procurement of inputs, marketing, financial services, capacity building, value chain development including  warehousing, and logistics;
• Define and quantify the overall market financing needs of MSMEs in the Agri-food and beverage sector. Assess whether MSMEs face restricted access to any financial services from financial institutions, under what circumstances such barriers are placed and whether these differ by sectors.

TASK 2: Capacity assessment of agri-food and beverage industry on green labelling and circular economy

• Perform a capacity assessment in order to determine the level of understanding of the concept of green labelling and capacities to introduce circular economy practices and needs;
• Finding gaps for improvements or lessons learned from the current circular economy practices and country’s green development action plan;
• Conduct comprehensive research for areas of capacity development (including energy, water and resource efficiency practices, use of transport, use of packaging, food waste, etc.) for MSMEs to introduce circular economy practices and green labelling;
• Review international circular/green economy practices and identify the best circular economy practice;
• Provide structured guidance and recommendations for Mongolian agri-food and beverage sector to adopt circular business/economy practices.

TASK 3: Identify the most potential sub-sectors to practice the circular economy and green labelling

• Analyze sub-sectors for the introduction of green labels and circular economic practices, and identify priority sectors, taking into account their contribution to economy, employment creation, market capacity, and efficient use of resources;
• Conduct comprehensive value chain analysis for each sub-sector. The value chain analysis will entail: each sector’s specific production profiles (e.g stages of production, transportation and storage, resource); value chain mapping (key stakeholders, flow of supplies and products, flow of funds and information, etc.); functional analysis of each value chain (profiling of industry structure, adoption of new practices, technology and innovation); economic analysis of potential opportunities to introduce circular practices to the value chains and stages of production;
• Map out the current geographic and sectoral distribution of MSMEs within the project area;
• Identify the most significant value chains or types of production that requires circular business/economy practices and further investigate the bottleneck in the value chain in pre-selected subsectors;
• Undertake a desk review of relevant activities conducted by government or other development partners on the selected value chains;

Inception Report: should demonstrate clear understanding of the task, present the detailed methodology and tools for data collection and analysis, including sampling, list of proposed interviewees, interview guides and client survey questionnaires, project performance rating approach, work plan and schedule. The Inception Report must be accepted by DS before the assessment can proceed to the next phase.

The final report’s main text should cover all of the questions raised in this TOR.

1. 1st Draft Report: will be sent to DS for checking factual errors and reviewing whether the report responds to the TOR’s questions and requirements.
2. 2nd Draft Report: will be circulated to the DS and partner organizations for comments. The consulting firms/organizations will deliver a presentation on the findings, conclusions, and recommendations at the virtual or face-to-face meeting upon an agreed date.
3. Final Report: will be approved by DS.

Deliverables and Schedule

The consulting firms/organizations will work closely with the DS team throughout the assignment period, under the supervision of the DS representative. The assessment reports will be submitted both in English and Mongolian.

№	Task	Timeline
1.	DS launches the competitive bidding for consulting firm selection.	28th of March, 2022
2.	DS contracts to select the firm.	25th of April, 2022
3.	Kick-off meeting	26th of April, 2022
4.	Consulting firm submits Inception Report and data collection tools to DS	3rd of May, 2022
5.	Consulting firm conducts the in-depth assessment in line with the approved Inception Report.	5th of May – 22nd of July, 2022
6.	Consulting firm submits 1st Draft Report to DS for factual errors and adequacy checking.	22nd of July, 2022
7.	DS checks factual errors and reviews whether the Draft Report responds to TOR questions and requirements.	29th of July, 2022
8.	Consulting firm responds to DS comments and submits the revised Draft Report.	2nd of August, 2022
9.	Organize results validation meeting with DS and implementing partners	2nd of August, 2022
10.	Consulting firm gives the presentation and submits the 2nd draft report to DS and partner organizations.	3th of August, 2022
11.	The consulting firm incorporates comments from DS and partner organizations and submits the Final Report (both in English and Mongolian). The Final Report will be approved at the DS in early August 2022.	5th of August, 2022

Materials to be Submitted

The offers will be selected on the basis of offers containing:

• A technical proposal for conducting the in-depth assessment, including the description of the methodology and tools for data collection, the description of particular tasks, action plan, etc; (This is not an inception report)
• Any further documents to prove qualification and experience;
• Technical and managerial capabilities of the consulting firms/organizations ;
• Reference from tax administration and social security authority
• CV of each person participating in the assessment, demonstrating necessary expertise;
• Budget plan, including travel plan for conducting the in-depth assessment;
• Notarized copy of the registration certificate of the organization;
• Organizational brochure/introduction; and
• A copy of previous similar assignments and reference letters.

Evaluation method and criteria

The contract shall be made to the consulting firms/organizations whose offer has been evaluated and determined as a) responsive/compliant/acceptable; and b) having received the highest score out of a set of weighted technical criteria (70%) and financial criteria (30%). Financial score shall be computed as a ratio of the proposal being evaluated and the lowest priced proposal received by DS and project team for the assignment.

The following qualifications required as below;

• The consulting firm/organization should demonstrate the abilities of the each team members and team Leader should have at least ten (10) years of combined experience in conducting research in the Agri-food and beverage sector, especially in the green business development; familiar with different models of the value chain structure and business models.
• Proven knowledge and working experiences in agri-food and beverage sector development models (green business development, business capacity building, market analysis, business research, payments systems, access to financing, etc.)
• Experience in assessment or research donor funded operations.

Application procedure

We encourage consulting firms/organizations who feel that they meet the requirements to submit their bids by procurement@dsmongolia.org by 10 April 2022. The documents in both English and Mongolian will be accepted.

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Payment structure

The payment for undertaking the assessment will be according to the following structure. 

• 10% payment upon signing the contract
• 10% payment upon undertaking Inception Report and data collection tools to DS
• 30% payment upon submitting revised 1st Draft Report to DS
• 20% payment upon presenting the findings to DS and partner organizations
• 30% payment upon submitting the Final Report and closing up the agreement