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Choice of Coordination Mechanism in the Kenyan Fresh Milk Supply Chain

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  • Awudu Abdulai
  • Eliud A. Birachi

Abstract

This paper examines the nature and determinants of coordination mechanisms used in the Kenyan fresh milk supply chains, using recent survey data of market participants from Nakuru and Nyandarua districts in Kenya. Three main contractual arrangements are observed in the fresh milk supply chain. These include spot markets, verbal contracts and written contracts. The empirical results indicate that though written contracts are sparingly used in the milk transactions, milk producers are more likely to adopt such contracts compared to traders. The results also show that location of producer, source of market information, distance to markets, travel time to buyers or suppliers, gender of operator, and presence or absence of enforceable contracts significantly influence the type of coordination mechanism used in both producer-buyer and retailer-seller transactions and travel time to milk suppliers. Copyright 2009, Oxford University Press.

Suggested Citation

  • Awudu Abdulai & Eliud A. Birachi, 2009. "Choice of Coordination Mechanism in the Kenyan Fresh Milk Supply Chain," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 31(1), pages 103-121.
    • Handle: RePEc:oup:revage:v:31:y:2009:i:1:p:103-121
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    File URL: http://hdl.handle.net/10.1111/j.1467-9353.2008.01428.x
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    1. Donkor, Emmanuel & Mbeche, Robert & Mithofer, Dagmar, "undated". "Relational contract decision of retailers in the grasshopper value chain in Uganda," 61st Annual Conference, Berlin, Germany, September 22-24, 2021 317078, German Association of Agricultural Economists (GEWISOLA).
    2. Baker, Derek & Mtimet, Nadhem, 2013. "It depends who you ask: How to establish a sampling frame for traders?," 2013 Fourth International Conference, September 22-25, 2013, Hammamet, Tunisia 159701, African Association of Agricultural Economists (AAAE).
    3. Yazeed Abdul Mumin & Awudu Abdulai, 2022. "Informing Food Security and Nutrition Strategies in Sub‐Saharan African Countries: An Overview and Empirical Analysis," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 44(1), pages 364-393, March.
    4. Boniface, Bonaventure & Gyau, Amos & Stringer, Randy, 2009. "Relationship quality as the predictor of long term relationship in the Malaysian dairy industry," MPRA Paper 24420, University Library of Munich, Germany.
    5. Awal Abdul‐Rahaman & Awudu Abdulai, 2020. "Vertical coordination mechanisms and farm performance amongst smallholder rice farmers in northern Ghana," Agribusiness, John Wiley & Sons, Ltd., vol. 36(2), pages 259-280, April.
    6. Liu, Y., 2018. "Determinants and impacts of marketing channel choice among cooperatives members: Evidence from agricultural cooperative in China," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 275898, International Association of Agricultural Economists.
    7. Ma, Wanglin & Abdulai, Awudu, 2015. "Linking apple farmers to markets: Determinants and impacts of marketing contracts in China," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 202719, Agricultural and Applied Economics Association.
    8. Lin Li & Hongdong Guo & Jos Bijman & Nico Heerink, 2018. "The influence of uncertainty on the choice of business relationships: The case of vegetable farmers in China," Agribusiness, John Wiley & Sons, Ltd., vol. 34(3), pages 597-615, June.
    9. Ajwang, Fredrick Odhiambo & Munyua, Catherine Ng’endo, 2015. "The Influence of State of Road and Ownership of Means of Transport to Smallholder Dairy Farmers’ Choice of Milk Marketing Outlet in Kipkaren Division of Nandi County in Kenya," Asian Journal of Agricultural Extension, Economics & Sociology, Asian Journal of Agricultural Extension, Economics & Sociology, vol. 9(2).
    10. Donkor, Emmanuel & Mbeche, Robert & Mithöfer, Dagmar, 2021. "Purchasing Behaviour and Relational Contract Decisions of Retailers in Grasshopper Value Chains in Uganda," 2021 Conference, August 17-31, 2021, Virtual 315105, International Association of Agricultural Economists.
    11. Donkor, Emmanuel & Mbeche, Robert & Mithöfer, Dagmar, . "Strategic business decisions of retailers in the edible insect value chain in Uganda," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 26(2).
    12. Mohd Suhaimi, Nurul Aisyah & de Mey, Yann & Oude Lansink, Alfons, "undated". "A transaction cost analysis of Malaysian dairy farmers' marketing channel selection," 2017 International Congress, August 28-September 1, 2017, Parma, Italy 261436, European Association of Agricultural Economists.
    13. Nguyen Thi Nha Trang & Thanh-Thuy Nguyen & Hong V. Pham & Thi Thu Anh Cao & Thu Huong Trinh Thi & Javad Shahreki, 2022. "Impacts of Collaborative Partnership on the Performance of Cold Supply Chains of Agriculture and Foods: Literature Review," Sustainability, MDPI, vol. 14(11), pages 1-28, May.
    14. Mailu, Stephen & Wachira, Ann, 2009. "The influence of prices on market participation decisions of indigenous poultry farmers in four districts of Eastern Province, Kenya," MPRA Paper 21312, University Library of Munich, Germany.
    15. Houtian Ge & Miguel Gómez & Christian Peters, 2022. "Modeling and optimizing the beef supply chain in the Northeastern U.S," Agricultural Economics, International Association of Agricultural Economists, vol. 53(5), pages 702-718, September.
    16. Alemu, Abebe Ejigu & Mathijs, Erik & Maertens, Miet & Deckers, Jozef A. & Gebregziabher, Kidanemariam & Baur, Hans & Gebrehiwot, Kindeya, 2011. "Trader-supplier Coordination in the Agrifood Supply Chains in Northern Ethiopia," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114218, European Association of Agricultural Economists.

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