The Importance of Assessing Marketing Preferences of Small-scale Farmers: A Latent Segment Approach

Abstract

This study uses a stated choice-based conjoint model to explore the marketing preferences of small-scale producers of fresh fruits and vegetables in Honduras. A total of eight attributes, proposed in hypothetical contracts to farmers, are evaluated. About two-thirds of farmers show preferences for traditional marketing systems, whereas one-third prefer new marketing channels associated with supermarkets. A latent segment approach, however, reveals significant levels of preference heterogeneity among small-scale farmers. The results suggest the importance of taking into account preference heterogeneity using latent classes in the development of policies aimed at linking small-scale farmers with new agri-food supply chains. À partir d 0 un mode`le de choix conjoint, cette e´tude examine les pre´fe´rences de commercialisation des petits producteurs de fruits et le´gumes frais au Honduras. Un ensemble de huit attributs, propose´s dans des contrats hypothe´tiques offerts aux agriculteurs, sont e´value´s. Deux tiers environ des agriculteurs affichent des pre´fe´rences pour les syste`mes de commercialisation traditionnels, alors qu 0 un tiers pre´fe`rent les moyens plus modernes de commercialisation par l 0 interme´diaire des grandes surfaces. Une analyse en termes de segments latents re´ve`le cependant une forte he´te´roge´ne´ite´des pre´fe´rences des agriculteurs de petite e´chelle. Les re´sultats soulignent l 0 importance de la prise en compte de l 0 he´te´roge´ne´ite´des pre´fe´rences par une analyse des classes latentes, dans le de´veloppement de politiques visant a`relier les petits producteurs aux nouvelles filie`res de distribution agroalimentaire.

Factors driving Thailand rice farmer decision-making in the choice of marketing channel

“…Price per se is rarely the sole determining factor (Tsourgiannis et al , 2008), particularly when the heterogeneity in socioeconomic characteristics of farmers and farm is taken into consideration (Hansson et al , 2012). Cost-focused farmers are more motivated by reducing costs than achieving a higher price (Tsourgiannis et al , 2008) or having a healthy cash flow (Blandon et al , 2010). Whilst economic goals are about what farmers want to achieve through a transaction, the other side of the coin are the transaction conditions offered by the channel (Shepherd, 2007).…”

“…In terms of the rationale behind the farmers’ choice of marketing channel, some studies have taken a socioeconomic perspective, focusing on characteristics such as the level of education, farm size, location, and social network (Abebe et al , 2016; Pham et al , 2019; Mgale and Yunxuan, 2020), transaction cost analysis (Escobal and Cavero, 2012; Mgale and Yunxuan, 2020), utility maximization (Blandon et al , 2010) or asset specificity (Pham et al , 2019). Other studies incorporate relationship dynamics between channel members such as power and trust (Schipmann and Qaim, 2011; Abebe et al , 2016; Mgale and Yunxuan, 2020).…”

“…In the context of economic decision-making, a framework relevant to farmers' goals is expected utility maximization (Nuthall and Old, 2018). If the farmer acts purely as an economic agent, he/she would select a marketing channel by evaluating the expected utility or net benefits of the channel (Blandon et al , 2010; Arinloye et al , 2015). Profit is one aspect of the expected utility, but other aspects include incentives received from buyers (Arinloye et al , 2015), and payment mechanisms and grading (Blandon et al , 2010).…”

“…the channel were measured with items adapted fromBlandon et al (2010) and229 Tsourgiannis et al (2012) and contextualized after the preliminary interviews. Transaction 230 condition was conceptualized to include mode of payment, buying capacity, costs of selling and 231 accessibility offered by channels.…”

Evaluation on Service Ability of Agri-Food Supply Chain

“…The 10-billion losses could meet the produce demands for millions of people. This concern has been strengthened by several sector-wide crises [3,4]. How to eliminate the waste in the process and improve the efficiency of supply chain is a big challenge to Chinese food industry as well as academia.…”