American Journal of Rural Development
ISSN (Print): 2333-4762 ISSN (Online): 2333-4770 Website: http://www.sciepub.com/journal/ajrd Editor-in-chief: Chi-Ming Lai
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American Journal of Rural Development. 2017, 5(6), 151-157
DOI: 10.12691/ajrd-5-6-2
Open AccessArticle

Choice of Marketing Channels in the Kenyan Domestic Organic Market

Murimi M. L1, , Karantininis K2 and Wahome R.G3

1Department of Agricultural Economics, University of Nairobi, Nairobi, Kenya

2Department of Economics, Swedish University of Agricultural Sciences (SLU), Uppsala, Sweden

3Department of Animal Production, University of Nairobi, Kenya

Pub. Date: December 29, 2017

Cite this paper:
Murimi M. L, Karantininis K and Wahome R.G. Choice of Marketing Channels in the Kenyan Domestic Organic Market. American Journal of Rural Development. 2017; 5(6):151-157. doi: 10.12691/ajrd-5-6-2

Abstract

The study was conducted to evaluate the factors influencing organic farmers’ participation in organic or conventional and direct or indirect market channels in the domestic market. These factors may include socio-economic, marketing or institutional factors. The study involved organic farmers in the peri-urban regions of Kajiado, Kiambu and Nairobi Counties. The data was collected between March and May 2014. Methodology: A questionnaire was administered to 117 organic farmers to establish the determinants of their choice of a market channel, in Kenya’s domestic organic market. This represented a census of the entire population of both certified and uncertified organic farmers serving the Nairobi market and affiliated to the umbrella body, Kenya Organic Agriculture Network (KOAN). Semi structured questionnaires were administered to the organic producers and the main buyers. A theoretical model of marketing channel choice, under random utility maximisation was used to test the effect of price, certification cost, requirements, group membership, and region (county) among other factors on the decision to choose a marketing channel. 56 per cent of the farmers sold through the available organic outlets. The other farmers (44 per cent) reported sales to the local conventional channels. 67.7 per cent sold directly to consumers either at the organic farmers markets or the conventional markets Different forms of transaction costs were observed to negatively impact on sales to the organic channels. Different approaches such as certification and information access may be employed to reduce transaction costs in the organic sector and encourage sales through indirect and organic channels. However, group formation alone may not enhance marketing of organic products hence more research is needed into group characteristics for effectiveness.

Keywords:
certification Kenya marketing channel multinomial logit organic transactioncosts

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