A Theory of Inclusive Business Models: Value Co-Creation, Base-of-Pyramid Integration, and Sustainable Development in Nigerian Agribusiness

This study develops an original theory of inclusive business models (IBM) in Nigerian agribusiness, examining the mechanisms through which value co-creation with base-of-pyramid (BoP) smallholder farmers generates sustainable development outcomes and commercial sustainability simultaneously. Existing IBM literature predominantly offers descriptive case compilations rather than explanatory theory, limiting the transferability of inclusive business lessons across contexts. This is a critical gap in the Nigerian agribusiness context where BoP integration represents both a development imperative and a commercial opportunity given the scale of smallholder farming populations in the North Central and South West agricultural belts. Employing an abductive theory-building methodology combining multi-case analysis of eleven agribusiness IBMs, 96 interviews with business managers, smallholder farmers, NGO partners, and government officials, and quantitative analysis of farming household outcome surveys, the study generates a process theory of IBM value co-creation. The theory identifies four generative mechanisms: resource complementarity matching, relational trust escalation, institutional bridging through development intermediaries, and feedback loop institutionalisation, through which IBM engagements transition from transactional to transformative value co-creation. The study makes original theoretical contributions by specifying the conditions, mechanisms, and outcomes of sustainable IBM development, resolving theoretical tensions between commercial and developmental logics in the BoP management literature. Policy implications for agribusiness investment facilitation, development finance, and inclusive growth strategy are developed. Keywords: inclusive business models, value co-creation, base-of-pyramid, agribusiness, sustainable development Nigeria.