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...
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doaj-c900134734fb408d90b04e460ffe19812020-11-24T21:15:19ZengAOSISSouth African Journal of Economic and Management Sciences1015-88122222-34362014-03-0117220721910.4102/sajems.v17i2.494264Effects of transaction costs on mushroom producers’ choice of marketing channels: implications for agricultural market access in SwazilandLawrence Majola Mabuza0Gerald Ortmann1Edilegnaw Wale2Postgraduate studentProfessorSenior LecturerMushrooms 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.https://sajems.org/index.php/sajems/article/view/494 |
collection |
DOAJ |
language |
English |
format |
Article |
sources |
DOAJ |
author |
Lawrence Majola Mabuza Gerald Ortmann Edilegnaw Wale |
spellingShingle |
Lawrence Majola Mabuza Gerald Ortmann Edilegnaw Wale Effects of transaction costs on mushroom producers’ choice of marketing channels: implications for agricultural market access in Swaziland South African Journal of Economic and Management Sciences |
author_facet |
Lawrence Majola Mabuza Gerald Ortmann Edilegnaw Wale |
author_sort |
Lawrence Majola Mabuza |
title |
Effects of transaction costs on mushroom producers’ choice of marketing channels: implications for agricultural market access in Swaziland |
title_short |
Effects of transaction costs on mushroom producers’ choice of marketing channels: implications for agricultural market access in Swaziland |
title_full |
Effects of transaction costs on mushroom producers’ choice of marketing channels: implications for agricultural market access in Swaziland |
title_fullStr |
Effects of transaction costs on mushroom producers’ choice of marketing channels: implications for agricultural market access in Swaziland |
title_full_unstemmed |
Effects of transaction costs on mushroom producers’ choice of marketing channels: implications for agricultural market access in Swaziland |
title_sort |
effects of transaction costs on mushroom producers’ choice of marketing channels: implications for agricultural market access in swaziland |
publisher |
AOSIS |
series |
South African Journal of Economic and Management Sciences |
issn |
1015-8812 2222-3436 |
publishDate |
2014-03-01 |
description |
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. |
url |
https://sajems.org/index.php/sajems/article/view/494 |
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