Influence Of Buyer Practices, Demographic And Farm Characteristics On Choice Of Marketing Channel Intermediary Of Unprocessed Tea In Kiambu County, Kenya

Abstract

Agricultural market liberalization aimed to boost competitiveness in commodity markets, with Kenya's tea sector initially seen as a success story under the Kenya Tea Development Authority (KTDA). However, by the early 1990s, smallholder farmers began advocating for market reforms to gain more influence over their produce. The government responded by transforming KTDA into a marketing agent and manager of small-scale tea farmers’ factories. Despite this, the problem related to broker intermediary continues, which has resulted in theft of unprocessed green tea leaves. It has also resulted in low quantities of green tea leaves being delivered to KTDA despite its efforts to supply farmers with fertilizer and extension services to small-scale tea farmers. This study investigated the determinants of the choice of marketing channel intermediary of green tea leaves in Kiambu County. Specifically, the study investigated the influences of: buyer practices, demographic characteristics, and farm characteristics on choice of marketing channel intermediary for fresh green tea levels in Kiambu County. A sample of 394 tea farmers from a target population of 25,624 tea farmers across five sub-counties: Githunguri, Gatundu North, Chania, Lari, and Gatundu South. The sample was determined using Yamane’s formula, and data was collected using a structured questionnaire. The study was grounded on three theories: utilizing utility theory, bulk building theory and transaction cost theory. Descriptive statistics were used when analyzing profile of tea farmers, while inferential statistics, mainly binary logit regression analysis was used to reveal the nature of the relationship between explanatory variables and the choice of marketing channels. Findings revealed that, buyer practices (credit terms, sorting methods and pricing) significantly the choice of marketing channel. Additionally, demographic factors and farm characteristics had a significant influence on farmers ’choice of green tea leaves marketing channel. In conclusion, it is recommended that the government through KTDA enhance strategies tailored towards addressing specific needs of different demographic groups, its buyer practices, and enhance market access for farmers. This will give it a more competitive edge compared to brokers, which will be of benefit to tea farmers.