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The role of trust in the performance of supply chains: A dyad analysis of smallholder farmers and processing firms in the sugar industry in Swaziland

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  • Masuku, Micah B.
  • Kirsten, Johann F.

Abstract

The purpose of this paper is to investigate the role of trust in the performance of the sugar industry supply chain in Swaziland. The study utilized perceptions of 124 smallholder cane growers in the sugar industry in Swaziland. Items presented in a Likert type scale were used to measure cane growersÂ’ trust in the millers. Descriptive statistics involving cross tabulation were used to determine the impact of trust on the performance of the cane growers, which in turn has an influence on the performance of the whole sugar chain. The results indicate that farmers who have trust in the millers perform better than those without trust, and hence they contribute to the performance of the whole chain, in terms of more and good quality sugarcane supplied to the mill. This implies more sugar production and increased income to the industry as a whole. The results imply that a relationship founded on trust and mutual respect is more likely to succeed than a relationship of convenience supported by legal contingencies. Therefore, there is a need for honesty, fairness and absence of opportunistic behaviour between millers and cane growers for the industry to improve its performance.

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Bibliographic Info

Article provided by Agricultural Economics Association of South Africa (AEASA) in its journal Agrekon.

Volume (Year): 43 (2004)
Issue (Month): 2 (June)
Pages:

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Handle: RePEc:ags:agreko:10135

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Keywords: Agribusiness;

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  1. Spekman, Robert E., 1988. "Strategic supplier selection: Understanding long-term buyer relationships," Business Horizons, Elsevier, vol. 31(4), pages 75-81.
  2. Erin Anderson & Barton Weitz, 1989. "Determinants of Continuity in Conventional Industrial Channel Dyads," Marketing Science, INFORMS, vol. 8(4), pages 310-323.
  3. John Humphrey & Hubert Schmitz, 1998. "Trust and inter-firm relations in developing and transition economies," Journal of Development Studies, Taylor & Francis Journals, vol. 34(4), pages 32-61.
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