Assessing Survival Strategies for Agro-dealers in Chipata and Petauke Districts, Eastern Zambia.

1Trans Nyimba Munalula, 2 Charles Muwe Mungule

1. Area Sales Manager, Bayer Zambia Limited, Zambia (MBA Management Strategy Student). Email: trans.munalula@yahoo.co.uk

2. Principle Lecturer & Portfolio Manager for Master Degree Programs, Botswana Accountancy College, Botswana (Research Supervisor) A research report submitted in partial fulfillment of the requirement for the award of a master of business administration in strategic management degree. Graduate School of Business Studies, University of Zambia, Lusaka. 13th April 2021.

Abstract: The face a lot of challenges and struggle with little hope for survival. The main purpose of this study was to assess the survival strategies agro-dealers use to sustain their business in Chipata andPetaukedistricts. The specific objectives of the study were to identify the major challenges faced by agro-dealers in Chipata and Petauke districts; explore the survival strategies used by agro-dealers to sustain their businesses in Chipata and Petauke districts; and to recommend appropriate measures that would help agro-dealers to sustain their business Descriptive survey design was used and questionnaires were used for data collection from 23 registered agro-dealers in Chipata and Petauke districts.The data was analyzed using both qualitative and quantitative methods and descriptive statistics were used aided by statistical package for social scientists (SPSS). The findings were that agro-dealers in Chipata and Petauke districts facedmajor challenges and these were lack of access to finance (95%), competition (90), lack of partnerships (86%), and lack of strategic assets (81%). The survival strategies used by agro-dealers were marketing strategies (95%), networks and partnerships (86%), training of employees (81%), engaging rural agents (81%), and establishing linkages (71%)

Keywords: Agro-dealers, Chipata, District, Petauke, Strategies, Survival

I. Introduction

This chapter discusses the background to the study and the statement of the research problem that informed the study. The general and specific objectives have been formulated to indicate what the study intended to achieve in terms of action, decision making as well as policy change. Additionally, research questions were derivedfromspecificobjectives and these questions ledthe researcher to gather data regarding the research problem. The study scope states the parameters within which the studyisconfined The significance of the study is also given.

1.1 Background

Agro-dealers are very important because they provide a stable supply of agriculture inputs on reasonable terms and they often give technical advice to smallholder farmers [1] Agro-dealers have tremendous potential to facilitate private sector led agricultural growth and development (Chinsinga, 2011). The Zambian government recognizes the importance of agriculture and has been supporting agro-dealers through various policy guidelines and agro-business programmes such as the Farmer Input Support Programme (FISP).

1.3Statement of the Problem

The purpose of this study is to assess the survival strategies agro-dealers use to sustain their business in selected districts in the Eastern province of Zambia. Agri-business offers opportunities for economic diversification and job creation in society. This sector if well-coordinated and managed, exerts a huge impact on poverty reduction, create more and better jobs, and increase productivity and incomes [3]; [2]. The Zambian government, likewise, recognizes the importance of agri-business and has been supporting such players as agro-dealers through policy guidelines and agro-business programs such as the Farmer input Support Program (FISP). Despite being involved in the agro-business programs that give opportunities to agro-dealers to be distributors of agriculture inputs to farmers, agro-dealers’ performance and competitiveness have remained poor, face a lot of challenges and struggle with little hope of survival The case study for market engagement innovation and impacts by [4] found that 61% agro-dealers were categorized as poor; 30% were categorized as average; and only 9% were categorized as good with sustainable business models. The difficulties that arise from this situation is that with time the non-efficient agro-dealers will be replaced in the value chain by efficient large multinational corporations that set up their outlets in the same locations as small indigenous agro-dealers thereby making it difficult to compete with the large multinational agro-input suppliers. The competition between large multinationals (agro-input companies) and indigenous agro-dealers is that the later slowly is being crowded out and out-competed by large multinational corporations [5]. The subsequent effect of this can be detrimental to the economy of the country. Since most of the smaller farmers are found in remote rural areas that are poorly reached by large multinational corporations, these remote areas will have inadequate and expensive input packages that may not be available in the small quantities that small poor smallholder farmers could afford once indigenous agro-dealers are out of the value chain. The indigenous agro-dealers will also not be available to provide technical advice to smallholder farmers [1]. This study will help in reducing the risk of many agro-dealers being wiped out of the agricultural value chain. Literature from Sub-Sahara Africa countries showed some survival strategies agro-dealers used to counter the challenges they faced. These were engaging rural agents to sell products [4]; training of workers in customer care and product knowledge [6]; joining networks and partnerships [7]; [2]; establish linkages with multinational agricultural input manufacturers [2]; having strategic assets [8]; use of ICT strategy [9] and adopting new marketing strategies [9]; Vani, 2017).

Assessing Survival Strategies for Agro-dealers in Chipata and Petauke Districts, Eastern Zambia.

1.4Aim of the study

The aim of the study is to assess the survival strategies agro-dealers used to sustain their business in Chipata and Petauke districts.

1.4.1 RESEARCH OBJECTIVES

1. To identify the major challenges faced by agro-dealers in Chipata and Petauke districts.

2. To explore the survival strategies used by agro-dealers to sustain their businesses in Chipata and Petauke districts.

3. To recommend appropriate measures that would effectivelyhelp agro-dealers to sustain their business in Chipata and Petauke districts.

1.4.2 RESEARCH QUESTIONS

1. What challenges do agro-dealers face in the value chain in Chipata and Petauke districts?

2. What are the survival strategies used by agro-dealers to sustain their businesses in Chipata and Petauke districts?

3. What measures can be recommended to help agro-dealers sustain their business in Chipata and Petauke districts?

1.5Study scope

This research study is confined within the Zambian agriculture value chain and restricted to Chipata and Petaukedistrictsof Eastern province of Zambia. Selected players in this farming areasuch as agro-dealers, the District Agriculture Coordinators (DACOs), agro-input companies took part in the study. The study addressed only the issues of agro-dealers in the agriculture value chain. The study could not be extended to other agricultural farming areas because of inadequate resources and time.

1.6Justification

This study is justified by several reasons most of which is drawn from literature. Little evidence shows any study that has been done in Zambia to show survival strategies of agro-dealers There are only sparse data to show the level of competition agro-dealers face from large multinational firms (Chinsinga, 2011; [8]

1.7Significance of the study

The findings of the study would provide practical solutions to agro-dealers in Chipata and Petauke districts that can help them to remain effective and competitive in the marketplace. The results of the study would help the Ministry of agriculture and NGOs working with farmers in Chipata and Petauke districts to identify practical solutions to bottlenecks in the agriculture value chain. The results will also help government to come up with appropriate policy directions that will positively impact the agriculture value chain.

II. DATA PRESENTATION AND INTERPRETATION

2.1Employment of qualified personnel in agro-products/services

Figure 1 shows employment of qualified personnel to run business. 70% agree that their business is run by non-technical personnel with 13% strongly agreed that their business did not employ technical personnel while 57% agreed to the same. Only 30% agro-dealers employed technical personnel in agro-products and or/ services. This is contrary to findings in Kenya where successful agro-dealers employed technical staff [10]

(Total Sample =23; data obtained using self-administered questionnaires)

2.2 No Training in Agro-dealership

Figure 2shows the data collected concerning the assertion that respondents do not have training in agro-dealership. The data shows that 57% of agro-dealer had training in agro-dealership with 35% disagreeing to not having training in agrodealership and 22% strongly disagreeing while 43% did not have the training with 13% strongly agreed to not having training in agro-dealership, 30% agreed to not having the training.

2.3Business Status with multinational input agro-dealers

Figure 3 shows whether agro-dealers were registered with other multinational input agro-dealers. Data shows that 87% agro-dealers were registered with the multinational input suppliers with 39% disagreed and 48% strongly disagreed that business not registered with multinational input suppliers, while 13% agreed to their business not registered with multinational agro-input suppliers This implies that majority of the agro-dealers (87%) had good working relationships with the multinational input suppliers and this is consisted with literature (Chinsinga, 2011).