Electronic Journal of Polish Agricultural Universities (EJPAU) founded by all Polish Agriculture Universities presents original papers and review articles relevant to all aspects of agricultural sciences. It is target for persons working both in science and industry,regulatory agencies or teaching in agricultural sector. Covered by IFIS Publishing (Food Science and Technology Abstracts), ELSEVIER Science - Food Science and Technology Program, CAS USA (Chemical Abstracts), CABI Publishing UK and ALPSP (Association of Learned and Professional Society Publisher - full membership). Presented in the Master List of Thomson ISI.
2020
Volume 23
Issue 4
Topic:
Economics
ELECTRONIC
JOURNAL OF
POLISH
AGRICULTURAL
UNIVERSITIES
Salau S. , Agbede T. 2020. ASSESSMENT OF PUBLIC RELATIONS AMONG CERTIFIED AND NON-CERTIFIED COCOA MARKETERS IN ONDO STATE, NIGERIA
DOI:10.30825/5.ejpau.196.2020.23.4, EJPAU 23(4), #06.
Available Online: http://www.ejpau.media.pl/volume23/issue4/art-06.html

ASSESSMENT OF PUBLIC RELATIONS AMONG CERTIFIED AND NON-CERTIFIED COCOA MARKETERS IN ONDO STATE, NIGERIA
DOI:10.30825/5.EJPAU.196.2020.23.4

Shehu Abdulganiyu Salau, Temitope Blessing Agbede
Department of Agricultural Economics and Extension Services, College of Agriculture, Kwara State University, Malete, Nigeria

 

ABSTRACT

Analysis of factors influencing public relations (PR) in agricultural marketing are scarce in the literature. Thus, this study identified the different types of adopted PR strategies, described the structure of cocoa market, estimated the marketing margin, determined factors affecting PR strategies and outlined the major challenges hindering the use of PR among certified and non-certified cocoa marketers. A combination of purposive and proportional sampling techniques were used to select 120 respondents for the study. To achieve the research objectives, the analytical tools are: descriptive statistics, Likert-scale, Herfindal Index, marketing efficiency model, marketing margin and multiple regression analysis. The result revealed that the most frequently used PR strategies was phone calls. The Herfindahl Index value of 0.19 and 0.12 suggested that the structure of cocoa markets among the certified and non-certified marketers was slightly concentrated and non-concentrated respectively. Moreover, the higher efficiency (122.6%) and marketing margin (18.44%) values for the certified cocoa marketers revealed that they are more productive than the non-certified marketers. Age, marketing margin, cost of damaged cocoa beans and household size are the important variables explaining the adoption of PR strategies among certified cocoa marketers. On the other hand, marketing margin, cost of damaged cocoa beans and household size are the important variables influencing the adoption of PR strategies among non-certified marketers. The most important factors hindering cocoa marketing are high cost of transportation and commission among certified and non-certified cocoa marketer respectively. We recommend the use of mobile phone and training of marketers on use of PR strategies and modern cocoa processing techniques. Irregular network, high airtime tariff and input subsidies challenges should be addressed by the government to reduce wastage in the industry.

Key words: Cocoa, marketers, marketing margin, PR and wholesalers.

INTRODUCTION

Cocoa (Theobroma cacao) is a significant cash crop thMiat emanated in South America (Julius, 2007). The increased world demand for chocolate in the 19th Century has enhanced cocoa production in most African countries. The major cocoa cultivating countries in West Africa are: Cote d’ivoire, Ghana and Nigeria. There are over 500, 000 cocoa farmers involved  in cocoa farming in Nigeria, producing about  20,000 tons of cocoa per year from over 600,000 hectares of land [5]. More than 50% of this quantity is produced in Ondo State alone with considerable amount produced in Oyo, Ogun and Osun States.

Cocoa can be certified and non-certified. Certified cocoa products are those differentiated on the basis of specific quality attributes that is validated under various schemes. Famers have to comply with voluntary quality and safety standards and procedures. Such compliance involves quality and safety assurance, brand development, product niche definition etc. Participation in certified cocoa markets represents a good income generation opportunity for small farmers in developing countries [9]. On the other hand, non-certified cocoa are cultivated without any reference to known basic standard requirements. In Nigeria, cocoa is the first agricultural export crop and is still the next significant export item, apart from petroleum. In fact, no single agricultural export commodity has earned more than cocoa in terms of foreign exchange earnings [4]. A part from employment opportunities, the cocoa sub-sector still provides an important source of raw materials and revenues to governments of cocoa producing states. 

The Nigerian cocoa beans were marketed by the Nigerian Cocoa Marketing Board (NCMB), before the initiation of Structural Adjustment Programme (SAP) in 1986.  The well-organized marketing of cocoa was terminated with the eradication of NCMB in 1986, due to structural changes in the Nigerian economy. Consequently, traders were confronted with the challenges of marketing cocoa bean at decent prices, leading to diversification into other sectors of the economy [2]. Furthermore, prices are no longer determined by farmers and marketers, they are set on by few companies and because the marketers do not have the required technological, individual and investment abilities to preserve the beans, they are coerced to trade with these intermediaries at ridiculous prices. Hence, the marketers receive a slight of the price paid by consumers in rich countries because of low price communication between marketers and export markets. The outcomes are:  price fluctuation, rising production costs, economic insecurity and poverty among marketers [11]. Worst still, the cocoa marketers have poor application of public relation (PR) strategies that could order quick and productive sales. PR strategies are strategies used by marketers to send the proper marketing message to the right customers using the correct medium at the accurate time to enhance market shares [7]. Organizations and marketers with poor utilization of PR are usually inefficiently managed, have poor deals and high labor turnover [12] Thus, this study identifies the adopted PR strategies, describes the structure of cocoa markets, estimate the profitability of cocoa marketing and determine factors influencing PR strategies among certified and non-certified cocoa marketers in the study area.

MATERIALS AND METHODS

Study Area
Cocoa is mostly grown in the rainforest belt of Nigeria. The cocoa cultivating states are: Akwa Ibom, Cross River, Delta, Edo, Ekiti, Ogun, Ondo, and Oyo. Ondo state is leading in terms of suitable climatic and edaphic conditions [6]. Hence, this study was conducted in Ondo State. The state falls between latitudes 50 451 and 70 521 north of the equator and longitudes 40 201 and 60 501east of Greenwich Meridian.  The climate is tropical monsoon with two main seasons – the rainy season (April–October) and dry season (November–March). Humidity is high during the rainy season and low during the Harmattan period of the dry season [1]. The temperature ranges between 21°C and 29°C and the annual rainfall of between 1150 mm to 2000 mm. The state is grouped into 18 Local Government Areas (LGAs) based on administrative convenience.  The farmers in the area also grow other cash crops such as kolanut, palm tree, coffee and food crops such as yams, maize, cocoyam etc.

Data collection and sampling methods
Primary data was employed for this study. Structured interview schedule was used to gather information on socio-economic variables, quantity of cocoa sold and purchased, public relations strategies employed by the marketers as well as the constraints hindering PR strategies in cocoa marketing in the area.

The target population are the certified and non-certified cocoa marketers in Ondo state, Nigeria. Ondo state, being the top producing state was purposively selected for this study. Three local government areas (LGAs) ruling in cocoa production namely; Idanre, Ile-Oluji, and Owo were purposively chosen [4]. Furthermore, from the list of cocoa marketers, 20 certified and 20 non-certified cocoa marketers were randomly selected from each of the 3LGAs, making a total of 60 certified and 60 non-certified cocoa marketers for this study.

Analytical techniques

Descriptive statistics tools such as frequency, percentage, mean, mode and range were used to describe the socioeconomic characteristics of the respondents.

The Herfindahl–Hirschman Index (H) was employed to analyze the structure of cocoa market. The Index is given as:

H = ΣMi2
(1)

Mi = Ai/A
(2)

Where:

Marketing efficiency (ME) was obtained from the ratio of revenue realized in cocoa marketing, to the costs of marketing services expressed in percentage [13]. The larger the ME, the more efficient the market [15].

(3)

Where

The profitability of marketers was determined using marketing margin (MM). The model is given as:

(4)

Where:

Factors determining PR were measured using multiple regression analysis. The model is stated as:

Y= b0 + b1X1 +b2X2 +b3X3 +b4X4 +b5X5 + b6X6 + ei
(5)

Where:

To describe the factors hindering PR strategies in the study area, a 5 point Likert-type scale was employed.  Respondents were asked to indicate whether they agree or disagree and  the extent of agreement or disagreement as the case may be. The response options and values assigned were as follows: strongly disagree (SD) = 5; disagree (D) = 4; agree (A) = 3; moderately agree (MA) = 2; and strongly agree (SA) = 1. These values were added and divided by 5 to obtain the mean (3.0). Factors with mean scores greater and lower than 3.0 will be regarded as significant and insignificant variables respectively.

RESULTS AND DISCUSSION

Socio-economic characteristics of respondents
Majority (66.7% and 91.9%) of the certified and non-certified cocoa marketers respectively were males indicating that the industry is male dominated.  About 43% and 77% of the certified and non-certified marketers were between the ages of 41–60 years. The mean age of certified and non-certified marketers are 46.8 and 51.8 years respectively (Table 1). 

Table 1. Socio-economic characteristics of respondents
S/N Variable Class     Certified Marketers Non-certified Marketers
Frequency Percentage Frequency Percentage
1 Age


Mean
21-40
41-60
61-80
21
29
10
46.8 years
35.0
43.3
16.7
5
46
9
51.8 years
 8.3
76.7
15.0
2 Gender Male
Female
  40  
20
66.7
33.3
57
05
91.9
8.1
3 Education Primary
Secondary
Tertiary
26
21
13
43.3
35.0
21.7
24
36
40.0
60.0
4 Household
size
Mean
1-10
11-20
48
12
5 persons
80.0
20.0
42
18
9 persons
70.0
30.0
5 Marketing Experience 1- 10
11-20
21-30
28
27
05
46.7
45.0
8.3
28
29
03
46.7
48.3
5.0
6 Primary occupation Cocoa marketing
Others
50
10
83.3
16.7
34
26
56.7
43.3
7 Membership of Association Yes
No
60 100 38
22
63.3
36.7
8 Mostly used PR strategies Phone calls
Facebook
Internet
Off-season visit
Gift
Signage
Text messages
Direct supply
Honoring invitation
Fellow customers
Marketers societies
12
6
8
4
7
5
11
3
2
2
0
20.0
10.0
13.3
6.7
11.7
8.3
18.3
5.0
3.3
3.3
0.0
21
2
2
7
7
8
5
2
2
2
2
35.0
3.3
3.3
11.7
11.7
13.3
14.5
8.3
3.3
3.3
3.3
Source; field survey, 2020

A large (21.7%) proportion of the certified marketers have tertiary education while the non-certified marketers have none. Highly educated traders are likely to be more responsive to innovation than those with primary and secondary education. Given this level of education, it is expected that facts can be disseminated with ease among the respondents [15]. The average household size is 5 and 9 persons among the certified and non-certified marketers respectively. Their bigamy way of life probably explains the large family size recorded in the area. Majority (83.3%) of the certified respondents has cocoa marketing as their primary occupation while just 56.7% of the non-certified respondents embraced cocoa marketing as a primary occupation. A quite large (45.0% and 48.3%) of the certified and non-certified marketers respectively, have between 11–20 years of marketing experience. This shows that the respondents are experienced in the trade. According to [15] this would enable the marketers understand the complexity of the trade and thus know how to minimize marketing costs in order to raise profit.  All (100%) of the certified respondents belonged to one cooperative society or the other and so have access to credit facilities when compared with their non-certified counterparts. According to Akinsanmi et al. (2005), cooperatives are a vehicle for development since they provide casual credit to farmers and marketers. Out of the nine PR strategies adopted by the respondents, the most often used is text messages and mobile phone technology among the certified and non-certified cocoa marketers respectively. The use of facebook and internets services is commonly used by the certified marketers.

Structure of certified and non-certified cocoa markers
The Herfindahl Index (HI) value of 0.19 and 0.12 were obtained for the certified and non-certified cocoa marketers respectively. This suggests that the structure of cocoa markets among the certified and non-certified cocoa marketers is slightly concentrated and non-concentrated respectively. A slightly concentrated market implies that the market is moderately well structured when compared to the non-concentrated one where there is large number of sellers and buyers and there are no barrier to entry. This agrees with the findings of [14].

Marketing efficiency of certified and non-certified cocoa marketers
Table 2, shows the average costs are ₦20,324, 000  ($50,810) and ₦14,371,000 ($35,928) for the certified and non-certified cocoa marketers respectively. On the other hand, the average revenue are ₦27, 520, 000 ($68,800) and ₦19,010,000) ($475250) for the certified and non-certified cocoa marketers respectively. The marketing efficiency value of 122.6% and 116.7% for the certified and non-certified cocoa marketers respectively indicates that the marketers are efficient in the business. The higher efficiency value of the certified cocoa marketers suggest that they are more productive when compared with the non-certified counterparts.  

Table 2. Marketing efficiency and Profitability of cocoa marketers
Variable Certified marketers    
Amount (₦)
Non-certified marketers         
Amount (₦)
Average cost of cocoa (50 MT)  20,324, 000 14,371,000
Average costs of transport  1,392, 628 1, 344, 471
Average costs of warehouse  170, 516 138, 808
Average costs of other marketing services  50,127 23,120.
Average costs of spoilt cocoa  31,435 45,591
Average costs of labor  476, 000 366, 400
Total costs  22, 444, 706 16, 289, 390
Total revenue generated  27, 520, 000 19,010,000
Market efficiency  122.6% 116.7%
Profit  5, 075, 294 2, 720,610
Return per capital invested 1.35 1.32
Percentage marketing margin 18.44 14.31
Source: field survey, 2020
Note: 1 dollar = 400 Nigerian Naira

The marketing margin values of 18.44% and 14.31 % for certified and non-certified cocoa marketers were obtained respectively. This indicates that every ₦1 sale result to a price spread of 18.4k among the certified cocoa marketers. On the other hand, every ₦1 sale result to a price spread of 14.3k among the non-certified cocoa marketers.  This shows that the certified cocoa marketing is more profitable when compared to the non-certified (Table 2).

Factors influencing PR among certified and non-certified cocoa marketers
Table 3 reveals the R square (R2) values of 0.392 and 0.303 among certified and non-certified cocoa marketers respectively. This implies that about 39% of total variation in the adoption of PR strategies was explained by the explanatory variables among certified cocoa marketers, while 59.8% is attributed to other variables not included in the model. On the other hand, 30.3% of total variations in the adopted PR strategies were accounted for by the included explanatory variables.

Table 3. Factors influencing PR strategies among marketers
Variables Certified marketers
(R2 =0.392)
Non-certified marketers
(R2=0.303)
Coefficient   t-value Coefficient  t-value
Age -0.049 -3.810*** 0.380 1.605
Marketing margin -0.063 -2.726*** 72.324 3.766 ***
Marketing experience 0.013 0.519 -0.770 -1.510
Membership of association -0.456 -1.052 0.141 0.435
Cost of spoilt cocoa 0.000 1.908* 5.700 4.235 ***
Household size 0.395 2.831*** 1.960 1.726*
Source: field survey, 2020
*, *** Significant at 10% and 1% respectively

Age, marketing margin, cost of damaged cocoa bean and household size are the important variables influencing the adoption of PR strategies among certified cocoa marketers. The coefficient of marketing margin and age are both negative and significant at 1% level of probability. This suggests that the adoption of PR strategies reduces the marketing margin of certified cocoa marketers. It also shows that the youth are good adopters of PR strategies than the aged marketers. The coefficient of costs of damaged cocoa beans is positive and significant at 10% level. This suggests that as the costs of damaged cocoa beans increases the adoption of PR strategies increases among certified marketers to enhance sales. The coefficient of household size is also positive and significant at 1% level of probability.  This indicates that households with larger members are likely to use more of PR strategies than those with fewer members.

On the other hand, marketing margin, cost of damaged cocoas bean and household size are the important variables explaining the adoption of PR strategies among non-certified marketers. Interestingly, the coefficient of marketing margin is positive and significant at 1% level of probability among non-certified marketers. Suggesting that increasing the use of PR strategies would lead to an increase in marketing margin of non-certified marketers. The coefficient of household size and costs of damaged cocoa bean are both positive and significant at 10% and 1% level of probability respectively.  This indicates that increasing any of these two variables would probably lead to an increase in the adoption of PR strategies.

Challenges hindering certified and non-certified cocoa marketing
Table 4, shows that the most important factors hindering the certified cocoa marketing are high cost of transportation and incidence of pests with the weighted means of 2.333 and 2.316 respectively. On the other hand, high cost of market commission and poor sales are the most important factors hindering non-certified marketing of cocoa in the area (Table 5).  

Table 4. Challenges hindering certified cocoa marketing
Challenges    SA    A    SD  Mean Std.D Rank
Poor storage facilities 26 (43.3) 24 (40) 10 (16.7)  2.266   0.733 4th
High cost of transportation 28 (46.7) 24 (40.0) 8 (13.3) 2.333 0.705 1st
Poor unit of measurement 19 (31.7) 27 (45.0) 14 (23.3)  2.083   0.743 8th
Poor access to formal credit 18 (30) 29 (48.3) 13 (21.7) 2.083 0.719 8th
Poor sales 20 (33.3) 29 (43.3) 11 (18.3) 2.150 0.708 7th
Poor drying mechanism 23 (38.3) 30 (50) 7 (11.7)   2.266 0.660 4th
Incidence of pest 25 (41.7) 29 (48.3) 6 (10)  2.316 0.650 2nd
Theft 26 (43.3) 15 (41.7) 9 (15)  2.283 0.715 3rd
High cost of market commission 23 (38.3) 24 (40) 13 (21.7)  2.166 0.762 6th
Source: field survey, 2020

Table 5. Challenges facing non-certified cocoa marketing
Challenges SA A SD Mean Std D Rank
Poor storage facilities 3 (5) 25 (41.7) 32 (51.3) 1.516 0.59 7th
High cost of transportation 4 (6.7) 27 (45) 9 (48.3) 1.583 0.61 6th
Poor unit of measurement 2 (3.3) 33 (55.0) 25 (41.7)   1.616        0.55   4th
Poor access to formal credit 19 (31.7) 18 (30) 23 (38.3) 1.9333 0.84 3rd
Poor sales 12 (20) 37 (61.7) 11 (18.3) 2.0167 0.62 2nd
Poor drying mechanism 1 (1.7) 25 (41.7) 34 (56.7) 1.4500 0.53 9th
Incidence of pest 4 (6.7) 28 (46.7) 289 (46.7) 1.6000 0.61 5th
Theft 2 (3.3) 24 (40.0) 34 (56.7) 1.4667 0.56 8th
High cost of market commission 35 (58.3) 17 (28.3) 8 (13.3) 2.4500 0.72 1st

CONCLUSION AND RECOMMENDATIONS

This study assesses public relation among certified and non-certified cocoa marketers in Ondo state, Nigeria. The result revealed that phone calls is the most important frequently used PR strategies among marketers.  Furthermore, the Herfindahl Index values showed that the structure of cocoa markets among the certified and non-certified marketers was slightly concentrated and non-concentrated respectively. Moreover, the higher efficiency and marketing margin values for the certified cocoa marketers implied that they are more productive than the non-certified marketers.  Age, marketing margin, cost of damaged cocoa beans and household size are the important variables explaining the adoption of PR strategies among certified cocoa marketers. On the other hand, marketing margin, cost of damaged cocoa beans and household size are the important variables influencing the adoption of PR strategies among the non-certified marketers. Lastly, the most important factors hindering the cocoa marketing are high cost of transportation and commission among certified and non-certified cocoa marketer respectively. Therefore, we recommend mobile phone as marketing tool among marketers. Consequently, marketers should be well trained on the effective use of PR strategies and modern cocoa processing and storage techniques. Government should provide basic inputs at affordable prices and help in the construction of market infrastructure to reduce spoilage and cost of transport. It should also address irregular network and high airtime tariff challenges to encourage PR adoption in the country.

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Received: 30.11.2020
Revieved: 18.12.2020
Accepted: 21.12.2020


Shehu Abdulganiyu Salau
Department of Agricultural Economics and Extension Services, College of Agriculture, Kwara State University, Malete, Nigeria

email: abdulganiyu.shehu@kwasu.edu.ng

Temitope Blessing Agbede
Department of Agricultural Economics and Extension Services, College of Agriculture, Kwara State University, Malete, Nigeria


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