Characterization, Awareness of Products, and Technical Efficiency of Baobab Candy Retailing in Kenya

Abstract

Globally, baobab tree is among the leading Indigenous Fruit Trees (IFTs) with extensive benefits such as a source of nutritious food, income, and raw materials in food processing. The tree grows in harsh climatic conditions where crop production is difficult. Despite the great importance of baobab, the tree remains underutilized and its market operates informally through weak value chains and few market players. Retail sector plays a crucial role in economic development and represents the largest proportion among agricultural value chain actors. However, baobab products remain few in the retail markets. Baobab candy is the common traded product by retailers in Kenya. Moreover, there exist knowledge gap regarding baobab retailing. Hence, this study sought to characterize baobab candy retailers, establish their awareness levels of baobab products, and estimate the technical efficiency (TE) of candy enterprises in the rural township and urban markets. The study adopted purposive and cluster sampling designs to draw a random sample of 352 respondents. A structured questionnaire was used for data collection. Multivariate statistical technique of principal component analysis (PCA) and cluster analysis (CA) was used to characterize candy retailers. A zero-truncated poison (ZTP) model was used to assess the determinants of retailer awareness toward baobab products. While Data envelopment analysis (DEA) and Tobit models were employed to establish the level of TE and its determinant respectively. The study results revealed that candy retailers are heterogeneous in nature and can be classified into three clusters namely: low-volume, average-volume, and high-volume retailers. Descriptive statistics indicated a low product awareness across the markets (mean=10) from a list of 28 products. ZTP model showed that gender, age, education level, years of retailing, and group membership significantly influenced retailers’ awareness positively whereas, distance to the market and income from other sources had a negative influence on awareness. DEA results indicated that candy enterprises attained a TE score of 0.69 in constant return to scale and 0.85 in variable return to scale. The model also revealed that majority of candy enterprises (94%) operated at an increasing return to scale. Gender, access to formal training, business registration, distance to the market and income from other sources significantly influenced the TE of candy enterprises. The study, therefore, recommends the need to develop strategies that can improve awareness and TE in baobab retailing. This includes; designing policies that promotes awareness and technical efficiency in the baobab sub-sector through training and educational programs. Similarly, gender-related issues should be addressed to bridge the gap of TE and awareness levels between female and male retailers. Likewise, county and national governments should invest in the baobab value chain and infrastructure to enhance access and availability of products in the markets. Hence, promote market development and commercialization of novel food products, particularly baobab.