Assessing Survival Strategies For Agro-Dealers in Chipata and Petauke Districts, Eastern Zambia
Assessing Survival Strategies For Agro-Dealers in Chipata and Petauke Districts, Eastern Zambia
Assessing Survival Strategies For Agro-Dealers in Chipata and Petauke Districts, Eastern Zambia
ISSN: 2581-3889
1
Trans 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%).
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).
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Assessing Survival Strategies for Agro-dealers in Chipata and Petauke Districts, Eastern Zambia.
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).
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Assessing Survival Strategies for Agro-dealers in Chipata and Petauke Districts, Eastern Zambia.
Employment of Qualified
Personnel
[VALUE]
[VALUE]
Agro-dealership Training
No
Training, 5 Training, 4
7% 3%
No Training Training
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Assessing Survival Strategies for Agro-dealers in Chipata and Petauke Districts, Eastern Zambia.
[VALUE]
[VALUE]
Percent
Lack of partnerships 86
Lack of market demand 52
Lack of access to finance 95
Competition among value chain… 90
0 10 20 30 40 50 60 70 80 90 100
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Assessing Survival Strategies for Agro-dealers in Chipata and Petauke Districts, Eastern Zambia.
Percent
86
Establish linkages with multinational … 71
81
Borrowing working capital from … 43
95
Adopting ICT strategies such as using … 24
0 20 40 60 80
Percent
Participating in Advertising/outdoor … 91
Marketing Stratagies
0 20 40 60 80 100 120
III. Conclusion
The study found access to finance as a major challenge and this is in line with literature that suggested that access to
finance is probably the highest ranking challenge that Small and Medium Entrepreneurs (SMEs) faced in the whole world
[12]; [13]. Other major challenges faced by agro-dealers in Chipata and Petauke districts were competition; lack of market
demand; lack of partnerships which is found to be critical for agro-dealer business success [11]; lack of strategic assets to
use as collateral which is in line with literature that showed that lack of adequate capital assets is one of the challenges
agriculture industry entrepreneur youth faced in Zambia [8]; and lack of training which agrees with the findings of the
survey of Nigerian enterprises by [6] that individuals with higher levels of education tended to do better than those with
lower levels. Other challenges were delay by government to pay agro-dealers who supplied inputs to farmers through
Farmer Input Support Program (FISP). This study can help policy makers to tailor their policy direction in line with the
needs of agro-dealers. the study can also help the ministry in charge of agriculture to fix bottle-necks in the agriculture in
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Assessing Survival Strategies for Agro-dealers in Chipata and Petauke Districts, Eastern Zambia.
put value chain and help the agro-dealers business to grow. the study is confined within the Zambian agriculture value
chain and restricted to Chipata and Petauke districts and could not be extended to other farming areas because of
inadequate resources and time.
IV. Recommendations
Since agro-dealers were given agriculture inputs by suppliers on consignment, it is recommended that agro-
dealers should build and maintain sustainable relationships with suppliers.
With regard to business diversification where agro-dealers were engaging in farming activities it is
recommended that that agro-dealers should diversify into other businesses in different industries to minimize
the risk of winding up should that particular industry be hit by some un foreseen events.
It is also recommended that agro-dealers should have strategic assets such as buildings and farms with title of
ownership to use as collateral for securing bank loans.
It is recommended that agro-dealers should use compliance to government regulation as strategy to differentiate
themselves from competitors, build and maintain long and sustainable relationships with stakeholders such as
government departments, suppliers and the general public.
The Ministry of Agriculture should pay agro-dealers who supply inputs to FISP promptly to ensure agro-dealers
were not put in a situation that would force them to into liquidation.
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