Choice Of Marketing Channels Research Articles

Effect of householder characteristics, production, sales and safety awareness on farmers’ choice of vegetable marketing channels in Beijing, China

PurposeFarmers’ selection of vegetable marketing channels directly affects their income and is important to stable vegetable supply and food control. The purpose of this paper is to investigate the farmers’ selection behavior of vegetable marketing channels, and to determine the key factors which affected farmer’ decision making.Design/methodology/approachA total of 191 valid questionnaires were collected from 50 villages in seven main vegetable production districts in Beijing urban areas from September to December 2015, yielding a response rate of 86.8 percent. The multinomial logit model was used for analysis in this study.FindingsThe results revealed that the farmers mainly selected farmers’ market, cooperative, and wholesaler to sell their vegetables, which comprised 96.57 percent of total vegetable sales. Estimation results showed that cooperative, vegetable acreage, price satisfaction, and slow sales were most important factors which influence positively the probability of opting to sell vegetables at a cooperative rather than at the farmer’s market. For wholesalers, gender of the household head and cooperative had most significantly negative effect, and age had a positive impact on farmer’s choice of market channels.Originality/valueThe results and implications obtained in the present study could help policymakers to establish a scientific-based and reasonable policy to encourage vegetable producers to participate in the circulation of vegetables in Beijing and guarantee their income in vegetable supply chain. The suggestions of this study could also be used for the improvement of the vegetable sector in other cities facing similar issues.

English

The study estimates small-scale mango farmers’ choice of market channels using the Cragg’s two-step procedure where the farmer decides on the channel in the first step and the proportion sold to the selected channel in the second step. Cross section data was collected from a sample of 224 mango farmers selected through multistage sampling just after the mango season. The study was carried out in Makueni County in Eastern Kenya. The county is leading in production of mangoes in Kenya, having produced over 146,000 tonnes valued at over 18 million US dollars, in 2015. The data was analyzed using Cragg’s two step regression model. The first step assessed factors that determine choice of a particular channel, while the second step assessed factors that influence the proportion of produce sold to the channel. Results show that socio-economic factors significant in the first stage are not necessarily significant in the second stage. In some cases, the direction of effect reverses. Factors such as distance to tarmac road, number of mango trees in the farm, membership in producer marketing groups, training in mango agronomy, and access to extension services affect choice of export market channel. Only membership to mango marketing groups significantly influences proportion sold. Household income, distance to tarmac, number of trees, market information, and gender significantly affect choice of the direct market channel. The direct market channel earns farmers the largest margins, followed by the export channel. However, majority of farmers sell to brokers followed by export channel. It was found that despite being aware that they could fetch higher prices through direct selling, they lacked financial capacity, transport resources, and information on market locations and requirements. Policies need to enhance financial capacity of farmers, as well as expand efforts to disseminate timely and accurate market information. Key words: Small-scale farmers, mango market channels, Kenya.

Knowledge systems and value chain integration: the case of linseed production in Ethiopia

ABSTRACTPurpose: This study uses data from a sample of 150 oilseed farming households from Arsi Robe, Ethiopia, to assess the impact of different knowledge bases (education, training and experience) and their interactions on linseed productivity.Methodology: A multiple regression analysis was employed to assess the combined effect of the knowledge bases, factors such as age of the household head, land size, marketing channels and geophysical factors (such as land slope) on linseed productivity.Findings: The findings reveal no differences in productivity between trained and untrained farmers. They further show that training and the interaction between training and experience positively influence productivity. Our findings, however, reveal farmer education to have an inverse yet insignificant effect on productivity. Furthermore, we found that factors such as the slope of the land and the choice of marketing channel also play an important role in influencing productivity.Practical implications: Moving away from the traditional top-down approach could be the answer to avoid a mismatch between the information given by trainers and what the farmers actually need.Theoretical implications: The study used interaction variables of knowledge bases, and attempted to demonstrate the importance of a tacit knowledge base, which is often not well documented and therefore neglected in research.Originality/value: The research demonstrates the combined effects that interactions between several knowledge bases have on the productivity of linseed farmers.

The Choice of Marketing Channel by Maize and Pigeonpea Smallholder Farmers: Evidence from the Northern and Eastern Zones of Tanzania

ABSTRACTThis study examines the factors affecting the choice of marketing channel used by smallholder maize and pigeonpea farmers in the northern and eastern zones of Tanzania. The reason for the focus on maize and pigeonpea is because these products are key crops that contribute to household production, consumption and cash income in the study zones. A Multinomial Logit Analysis of a multistage sample of 562 smallholder farmers, who market maize and pigeonpea, showed that transaction costs, household wealth, access to credit and extension services, and social capital affect their choice of marketing channel. This outcome suggests that policies aimed at reducing transaction costs, improving access to productive assets, prudent use of credit, and promoting the use of well-organised farmer groups to access appropriate technology and information could enhance market access and better integrate smallholder farmers into markets in the study areas.

Impact of Milk Marketing Channel Choice Decision on Income, Employment and Breeding Technologies among Dairy Farmer Households in Kericho County, Kenya

The study examined the impact of milk marketing channel choice decisions on dairy farmer household income, employment and breed technologies among dairy farmer households in Kericho County. Data was collected from 432 dairy farmer households using multistage cluster sampling technique. Both primary and secondary data were used in the analysis. Processing and analysis of survey data was carried out using STATA version 12. Multivariate probit and propensity score matching was used in data analyse. Propensity score matching was also used to account for selection bias. Matching results show that the average effect of the farmer household that sold milk to commercial buyers had higher probability of obtaining Kenya shillings 16.00 per day as compared to households that did not sell milk to commercial buyer. While selling through commercial milk buyers had significant positive effect on farmer welfare, majority of dairy farmers were hesitant to engage with them. Milk buyers value security in supply which comes from trusted relationships and contracts. Establishing such relationships is in the long-term interest of the dairy farmer. Therefore, to improve farmer welfare, group formation and partnership development should be strengthened, milk cooperative societies needs to be bolstered and an increased financial investment in livestock markets by national and county governments.

Analysis of Determinants of Vertical and Horizontal Integration among Smallholder Dairy Farmers in Lower Central Kenya

This study sought to analyze the determinants of vertical and horizontal integration among smallholder dairy farmers in Lower Central Kenya. Integration leads to high gross margins, influences choice of marketing channel and improves market participation, encouraging commercialization of dairy smallholder farming. A logit regression model was used to determine the likelihood of a household to integrate vertically or horizontally in its dairy enterprise. A multistage sampling technique was used, and data was collected from 288 small holder dairy farmers in Kiambu County. Processing and analysis of the survey data was carried out using SPSS version 20 and STATA version 12. Fixed investment cost, storage type, milk cost share, percentage of milk sold and dairy enterprise turnover were hypothesized to be key factors in explaining a household’s likelihood to vertically integrate in its dairy enterprise. An increase in total fixed investments, turnover and volume of output contribute to the probability of a household integrating vertically. Horizontally integrated farmers were willing to pay more for market information and had higher monthly margins. The paper recommends that farmers should establish and strengthen existing associations and integrate vertically and horizontally on the basis of their spatial location and milk output. Key words: logit regression, integration, smallholder famers.

An Analysis of the Factors Influencing Marketing Channel Choice by Paddy Rice Farmers in Myanmar

An Analysis of the Factors Influencing Marketing Channel Choice by Paddy Rice Farmers in Myanmar

Market-Channel Choices of Indonesian Potato Farmers: A Best–Worst Scaling Experiment

We present an empirical analysis of how buyer (and trader) attributes influence decisions of market participation and channel choice among smallholder potato farmers in West Java, Indonesia. We use a best–worst scaling experiment to evaluate the determinants of these decisions and gauge the influence of buyer attributes. Our latent-class cluster analysis reveals that producers have heterogeneous preferences for buyer attributes, which address classic smallholder constraints such as access to inputs, credit, and information. This heterogeneity can be somewhat explained by household characteristics and assets. The broad mass of our sample sought buyers whose attributes imply lower market risk for farmers. Yet roughly a quarter of our sample, a portion that included farmers with large, specialised farms, sought buyers who could provide inputs such as high-quality seeds.

Tomato Farmers and Modernising Value Chains in Indonesia

The tomato value chain in Indonesia has transformed in the last two decades. We assess this transformation here, focusing on small tomato farmers in West Java and the determinants of their market-channel choices (as well as the technology correlates of those choices). These farmers sell to traditional village traders, urban and modern wholesalers, and supermarkets, and they have all invested heavily in irrigation and rely on external inputs. We find differences among farmers selling to different market channels. To wit, non-land assets—especially irrigation—are important to farmers participating in the supermarket, or modern, channel, but farm size affects modern-channel participation only in high-level commercial zones (zones dense in infrastructure and near highways). We also find that modern-channel farmers earn more profit than farmers in other channels but do not necessarily use chemicals more intensively. Yet hardly any farmers sell graded tomatoes; the main ‘capture of rents’ goes to specialised and modernising wholesalers.

Farmers’ choice of cattle marketing channels under transaction cost in rural South Africa: a multinomial logit model

This study applied a transaction cost approach to the analysis of cattle marketing behaviour among smallholder farmers in communal land areas of KwaZulu-Natal, South Africa. The objective was to test the effects of information, negotiation, and monitoring costs on the decision to sell to private buyers, speculators or at auction. The theoretical predictions of transaction cost economics were tested based on primary data collected from 230 cattle farm households in 13 communities of the Okhahlamba Local Municipality. The results of a multinomial logit regression revealed some unique insights. They showed that the probability of selling at auction vs selling at the farm gate increased during the end-of-year festive season, indicating the scope of market uncertainty surrounding auctions. They also showed that the probability of selling at auction vs selling to speculators increased with proximity to the auction marketplace and decreased with knowledge of the buyer, suggesting higher opportunity costs of time and efforts associated with selling at auction, and considerable negotiation and monitoring costs incurred when selling to speculators. Other significant predictors of auction channel selection were volume supplied and farmer's age. This study concludes with some implications for the livestock marketing policy in South Africa.

An assessment of mango famer's choice of marketing channels in Makueni, Kenya

Improving market access for small-holder farmers is important in helping towards raising rural incomes and reducing poverty. The Millennium development goal number one is to eradicate poverty. Most of the poor are small scale farmers in rural areas of Africa and Asia. The Comprehensive Africa Agriculture Development Program (CAADP) anticipates that improving access to market for these farmers will help towards reducing poverty. Small scale farmers in developing countries are excluded from markets due to long value chains, lack of transparency, and presence of too many players. Mangoes are produced in the Eastern and Coastal areas in Kenya. Farmers in the Makueni have taken up mango farming quickly, making Makueni the leading producer of mangoes in Kenya. Marketing is however not organized. Despite the presence of several mango buyers in the country, mango farmers are experiencing up to 30 percent post-harvest losses, and gross margins are low at Kshs. 1.70 per piece. Profit should guide farmers’ choice of market channel, yet this is often not the case, it is not clear what drives farmer decision of the channel to sell to. There is no study that has actually been carried out to determine the factors that influence farmers’ decision to participate in the available market channels; this is the literature gap that this study sought to fill. The aim of this study was to assess the factors that influence mango farmers’ choice of market channels in Makueni County. The study used data collected in 2014 from a sample of 227 farmers using multistage and random sampling techniques. Analysis of Variance was used to determine the difference in the prices offered by the different channels, while Multinomial logit model was used to quantify the factors affecting channel choice. Results of the study show that farmers sold to three major channels, which are brokers, exporters, and direct market. Majority of the farmers (58 percent) sold to brokers, 30 percent to export, while the rest sold to direct market. Price analysis results show that farmers selling to direct channel earned the highest average prices, while brokers offered the lowest prices. Analysis of Variance (ANOVA) results find sufficient evidence that prices offered by the channels are different. The multinomial logit results show that farmers who were members of producer marketing groups, had attended training, and had a large number of mango trees were more likely to sell to exporters relative to brokers. In addition, farmers who owned a vehicle, were closer to the tarmac road, and had access to market information were more likely to sell to direct market relative to brokers. Results of this study provide insights for the ongoing efforts to transform agriculture from subsistence to market oriented activity for farmers in Kenya. There is need to assist farmers link with organized and formal markets to bolster their incomes. The study recommends that interventions aimed at providing market information, as well as training and extension to farmers should be reinforced. Producer marketing groups can fill the gaps left by marketing boards through linking farmers with buyers, and assisting farmers attain quality and safety requirements of especially export market. These quality and safety requirements are a major impediment to access to niche markets. In addition, it is more effective and cheaper to offer training and extension services to farmers through the groups. The study recommends further research on the marketing side, to determine the constraints and challenges faced by marketers would also be beneficial for policy and/or practice.

Agriculture Performance and Future Outlook on Food Commodities in Kerala

Indian dairy industry which was highly regulated till late-1990s, has been completely liberalized and exposed to world competition. The past decade has seen rapid changes in the Indian dairy sector and there have been growing concerns on the likely impacts of these changes on smallholder producers. The present paper has analysed determinants of market channel choices of small milk producers based on farm household survey and has investigated what impacts these market channel choices may have on farmers’ income and technology adoption. The study has found that though there have been emerging milk marketing channels, the traditional sector still dominates. The analysis has indicated that small dairy farmers are not excluded from the cooperatives but are excluded from the modern private sector.

Factors Having The Most Significance on the Choice and Selection of Marketing Channels Amongst Communal Cattle Farmers in Vhembe District, Limpopo Province

The prime objective of this study was to investigate the factors having the significance on the choice of cattle marketing channels, and in addition, participation of the farmers in mainstream form...

English

This article aims to contribute to a better understanding of variables that influence the motivation behind the preferred choice of cattle marketing channels in north eastern communal area of Namibia. The data required for the study were collected through a small-scale survey, key informants in-depth interviews and review of secondary data were analysed using Multinomial Logistical Regression. The results showed that the majority (62%) of small scale cattle farmers preferred to trade through informal marketing channel (comprising open market, private sales and butcheries). The abattoir was the single most preferred channel for 38% and the only available formal market. Four factors are identified motivating cattle farmers to choose this marketing channel namely, the gender of the household head, marketing information received, education and number of livestock sold. The results also suggest that formal marketing is relatively relevant to farmers with large cattle numbers and meet the required standards from abattoirs. The study recommended that in order to increase the number of cattle marketed through the formal channels, there is need to improve overall herd size, as well as setting attractive prices coupled with reduced delays in making payments to the farmers for their livestock sold.   Key words: Formal market, informal market, factors, sales, agriculture, livestock.

Effects of transaction costs on mushroom producers’ choice of marketing channels: implications for agricultural market access in Swaziland

Mushrooms are highly perishable agricultural commodities, and as such their marketing is invariably associated with high transaction costs. Despite the mushroom enterprise gaining popularity in a number of sub-Saharan African (SSA) countries, where production is dominated by rural-based small-scale farmers, no research has been done to study the nature and complexity of transaction costs encountered by these producers in attempting to participate in mainstream supply chains. This study uses cross-section data obtained in 2011/2012 from mushroom producers in Swaziland to study the effects of transaction costs on producers’ choice of marketing channels and the quantity of mushrooms supplied. Having used Cragg’s model for analysis, the results indicate that producers’ decisions of where to sell their mushrooms are significantly affected by household labour endowment, production capacity, access to cooling facilities and market information, and producers’ bargaining position. Meanwhile, the quantities of mushrooms sold are significantly influenced by the difficulty in accessing reliable transport and producers’ level of uncertainty in meeting buyers’ quality requirements. The study concludes by highlighting potential interventions that could minimise marketing and transaction costs and further improve the general agricultural marketing environment in Swaziland.

Market Channel Choice and Its Impact on Farm Household Income: A Case Study of 243 Apple Farmers in Shaanxi province, China

Although Shaanxi province is the largest in China, both in terms of apple production and cultivated areas, with local farmers’ income mainly sourced from apples, the per-capita net income of farmers in Shaanxi province remains behind the national average. Since the market channel choice of farmers could be perceived as one of the available income strategies, this paper provides empirical evidence to measure the impacts of market channel choice on farmers’ income using a Heckman sample selection model and an OLS model based on a farm household survey of 243 apple farmers in Baishui and Luochuan counties of Shaanxi province, China. Moreover, this paper discusses the different impacts of market channel choice on household income among farmers who are cooperative members and those who are not.

Assessment of Customer Satisfaction at Farm Gate Markets

This study attempted to gain empirical evidence of attitudes, preferences, and characteristics of consumers who attend farm gate markets, measuring their customer satisfaction. The article aims to explore whether the choice of this particular marketing channel is motivated by an emotional impulse or is the signal of an enduring attitudinal change justified by higher satisfaction with perceived food and service quality. A descriptive analysis of the customers' profiles was obtained with the cluster analysis, and a structural equation model to investigate the relationship between perceived quality and customer satisfaction and loyalty was proposed and tested.

Insurance Marketing Channel as a Screening Mechanism: Empirical Evidences from Taiwan Automobile Insurance Market

Venezia, Galai and Shapira in 1999 proposed a theoretical framework that considers asymmetric information to explain the co-existence of the independent agent and direct underwriting systems in the insurance market. In separating equilibrium, high-risk clients tend to purchase insurance through independent agents, whereas low-risk clients prefer dealing directly with underwriters. Using a unique data set from Taiwan's automobile liability insurance, this paper tests the screening mechanism hypothesis proposed by Venezia, Galai and Shapira. The results reveal that a positive channel-claim correlation exists in the subsamples of cars aged more than three years. Significant positive channel-claim correlation indicates that high-risk policyholders prefer to purchase insurance from an independent agent, whereas those with lower risks tend to buy insurance from direct writer channels. The results support the screening mechanism hypothesis and demonstrate that marketing channel choice could serve as a screening mechanism in an insurance market characterised by asymmetric information.

Factors Affecting the Choice of Marketing Channel by Vegetable Farmers in Swaziland

<span style="font-family: Times New Roman; font-size: small;"></span><p>Vegetables as a group of horticultural crops are important for their contribution as an income support to a large proportion of the rural households. However, enhancing vegetable farmers to reach markets and actively engage in the markets is a key challenge influencing vegetable production in Swaziland. The perishable nature of vegetables necessitates effective marketing channels. The aim of this paper was to investigate factors affecting farmers’ choice of marketing channels using survey data gathered during the 2011 production season. Data were collected from 100 randomly selected vegetable farmers. Descriptive and multinomial logistic regression analyses were used. The results indicated that age of the farmer, quantity of baby corn produced and level of education were significant predictors of the choice to sell vegetables to NAMBoard market channel instead of selling to other-wholesale market channel. The age of the farmer, distance from production area to market, membership in farmer organization and marketing agreement were significant determinants of the choice to use non-wholesale market channel over other-wholesale market channel. It is therefore important to promote collective action as an institutional vehicle for linking farmers to agribusiness supply chains. Farmers should establish networks since they aid in sharing knowledge, farmers can improve produce grades as required by market.</p><span style="font-family: Times New Roman; font-size: small;"><br /></span>

Marketing Channel Choice and Marketing Efficiency Assessment in Agribusiness

In agribusiness, profitability critically depends on the choice of proper marketing channels. This article studies the factors influencing marketing channel choices of vegetable farmers. Vegetable farmers have generally 3 choices to sell their produce, which are formal and informal market participation vis-à-vis nonmarket participation. Ten independent variables are considered for the study and a multinomial logistic regression model is used for the analysis. The study finds 4 major variables that can influence farmers’ decision to shift from nonmarket participation to informal or formal market participation. The article further identifies 4 microlevel marketing channels and assesses their efficiency.