Improving working relationships for smallholder farmers in formal organic crop supply chains: Evidence from KwaZulu-Natal, South Africa

Abstract

The 48 members of the Ezemvelo Farmers' Organisation (EFO) in KwaZulu-Natal, South Africa (SA), that are fully-certified as organic farmers were surveyed in October-December 2004 to assess their perceived levels of satisfaction, trust, cooperation and commitment in a formal supply chain producing amadhumbes (a traditional vegetable tuber), potatoes and sweet potatoes for a major SA supermarket group. Empirical recursive models show that a high level of satisfaction in the working relationship results in these farmers trusting the pack-house agent more. High levels of trust, in turn, lead to higher levels of both commitment to, and cooperation in, the supply chain. A simultaneous-equation model showed that EFO members with higher levels of commitment tend to be more cooperative, and that members with higher levels of cooperation tend to be more committed toward the working relationship. These results suggest that strategies to improve the working relationship with the pack-house agent need to promote satisfaction, trust, cooperation and commitment. For example, co-investment in better crop storage facilities at farm-level would promote satisfaction and hence trust. There is also scope for more cooperation in the planning of new organic crop products to grow and market, and to remove some price uncertainty by giving EFO farmers more information about prices that they will be paid by the packhouse in this supply chain.

Relationship Dynamics in the Pineapple Supply Chain: Empirical Evidence from the Garo Hills of Meghalaya

“…Though early research in agriculture supply chain focused on economics of channel, lately Barry et al (1992), Gereffi (1999), Granovetter (1985), Humphrey and Schmitz (2002), Mighell and Jones (1963) and Williamson (1985) have reported about the evolving trend towards the study of relational exchange. Darroch and Mushayanyama (2006), Engelseth and Karlsen (2008), Fisher et al (2008), Leat and Revoredo-Giha (2008), Masuku et al (2007), Roekel et al (2002), Spiller and Gyau (2008), Spiller et al (2007) and Zhang and Dinghuan (2009) have also worked on the various factors related to analysis of relationships in an agriculture supply chain with focus towards relationship factors like trust, contract, commitment, personal bonds, relative dependence, opportunistic behaviour and cooperation among the chain partners.…”