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Do Brokers Help or Hinder the Marketing of Fresh Produce in Lusaka? Preliminary Insights from Research

Listed author(s):
  • Tschirley, David L.
  • Hichaambwa, Munguzwe

Brokers are agents who arrange sales without taking ownership of the commodity, earning their money on a commission. Brokers are a common but often controversial presence in wholesale markets of East and Southern Africa. Efficient brokering can be beneficial by matching buyers and sellers more effectively than if each had to search independently for someone to transact with. Yet buyers and sellers can be harmed if brokers are able to behave in uncompetitive, collusive, or unethical ways. In Soweto market of Lusaka, common complaints lodged by sellers are that brokers force sellers to use them by threatening the security of the sellers’ produce, and that the brokers add “hidden” commissions when selling a farmer or trader’s produce. This policy brief explores the role of brokers in the marketing of fresh produce in Soweto Market. It concludes that, while brokers appear to provide some valued service to some sellers, the chaotic nature of the market and the lack of any regulatory and enforcement structure leads to questionable broker behaviour including charging of hidden commissions. As government and city officials grapple with how to improve fresh produce wholesaling, it is imperative that they focus not just on physical infrastructure but also on the governance, regulatory, and enforcement structures without which new market places will be of little use.

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Paper provided by Michigan State University, Department of Agricultural, Food, and Resource Economics in its series Food Security Collaborative Policy Briefs with number 93007.

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Date of creation: Jun 2010
Handle: RePEc:ags:midcpb:93007
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