Analysis rapidly adopting the use of milk

Analysis on the
effects of milk atms on the marketing of milk by small holder farmers in  kiambu county.

A87/4760/2014

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email;[email protected]

date; jan 28,2018

 

abstract

supermarkets and
other busy markets are rapidly adopting the use of milk atms in the marketing
of milk.this is because prices are lucrative for suppliers of fresh milk.in the
past dairy sector has had some challenges but most of this challenges have been
solved mostly in production stage hence making this business a succes.the
challange to farmers has been when it comes to marketing of their
product.thanks to the changing technology farmers who do not have access to big
processing companies such as brookside kcc fresher and others can now sell
their milk locally by using milk atms.in order to to address this knowledge gap
this study set out to examine the effects of milk atms on marketing of milk by
small holder farmers who do not have priveledge to sell their milk to large
processors.to address this the present study analysed data from a rondome
sample of 56 milk atm operators in kiambu county.descriptive methods were used
to characterize small holders.the results show that marketing is dominated by
male with a percentage of 55.9% .average prices of milk in most areas range
between 65-70 ksh.based on this findings the study reccommends more funding to
small holder farmers to be able to buy such machines.

key words; small holder; milk atms;supermarkets;

 

1.0 INTRODUCTION

1.1 background

in the kenyan
economy , agriculture is the leading contributor in the kenyan
income.agriculture consist of several sectors but mostly will be dealing with
the dairy sector.milk is the most common product that most kenyans consume each
day.milk can be drunk fresh, used to make tea and it also has other products
such as cheese yourghourt and mala.this products are usefull in the food
industry.processing is dominated by large firms such as brookside kcc  fresher who process and pack fresh
milk.kenyan dairy industry has been a success due to extension services and
also kenyan climate which is favourable for excotic breeds that have a better
production hence boosting production levels of milk.milk being highly
perishable means that its marketing should be able to make it available for
people for consumption as soon as its production.supermarkets provide both
processed milk and also others are also adopting selling fresh milk in the milk
atms.few years back such machines were not in the supermarkets but since the
rise of their popularity they have taken over in most suppermarket and other
high end markets such as busy market areas.supermarkets and this busy markets
provide reliable and fast growing market for milk and also attract better prices
in overall.

 

1.2 Statement of
the reasearch problem

The method of
marketing  of milk determines how much
the seller charges for his product.milk atms attract better prices,offer good
hygine practises and also milk is available almost anytime a buyer requires.besides
that the owner doesnt have to be around the whole time in marketing giving
him/her time to spend on other urgent matters.previous studies have dominated
on large processors since they have the huge chunk of the market and are able
to deal with wide variety of farmers and able to reach a large market.for small
farmers who do not belong to any cooperatives or who do not sell to this
processors, the only option they have is to hawk their milk or use milk atms in
the marketing of their milk.rise of milk atms is being achieved since there are
numerous supermarkets in the country and each is trying to step up the
competion in the industry.the literature points out how the atms have improved
the marketing of milk.however since this machines are new, there is limited
information about them.understanding how this machines operate and the related
cost is crucial point in comming up with their contribution in the overall
marketing.the best to my knowledge is there is no such study that has been
carried in milk atms effect on marketing in kiambu county despite this
technology being on a rise.this study aims to add to the existing information
on milk marketing to help the small holder farmers deal with the marketing
issues they face.

 

 

1.3 Objective of
the study

the main objective
of this study was to find out the effects of milk atms in the marketing of milk
by small holder farmers in kiambu county,kenya.

 

the specific
objectives were;

i.      
to
determine factors that influence use of milk atms in milk marketing

ii.    
to
characterize marketing of milk

critism &
research gap

productivity trends
and performance of dairy farming in kenya

kenyas dairy
industry is dynamic and plays an important role in economic and nurtition of
this country.kenya has one of the largest dairy industries in the subsahara
africa.through the last livestock census conducted in 1966 the current official
cattle population statistics came from ministry of livestock and development
through its field reports compiled by extension officials the official
statistics place the no of milking cattle at 3.8 million(government of kenya
2008)

a survey conducted
by small holder dairy project(sdp) asserts that approximately 6.7 million dairy
cattle in kenya. the food agricultural organisation (fao) on the other hand
estimates a figure of 5.5 million milking animals.

the industry has
grown tremendously since its liberalization in 1992.liberalization lead to a
rapid growth of informal milk trade that consist of small scale operators
dealing in marketing of raw milk.at the time there was an emergence of new
isntitutional arrangement in milk collection processing and marketing which included
hawkers,brokers and self help groups.the informal milk market controls an
estimated 70% of the total milk marketed in kenya(kdb2009;government of kenya
2006).this sector is important and is driven by among other factors the
traditional preferences for fresh milk and its relatively lower costs.

raw  milk often offers prices which are high to
producers and lower to consumers but with several challanges relating to
quality control and standards and the associated health and safety concerns.the
informal milk market has in the past faced several challenges.this was because
prior to policy change in 2004 informal vendors including mobile milk traders
and bar vendors and milk transporters were not officially recognised under the
old dairy policy.

as a result they
were frequently harrased as powerful marketing dairy players sought to protect
their inerest and increase their market share

 

1.4 justification
of the study

this study provides
an important information on the how milk marketing has been changed through use
of technology in kiambu county.it also provides insight on the factors that
influence the use of milk atms.this information will be usefull to stakeholders
in the dairy sector.this will help in expanding the dairy sector by attracting
more players in the marketing of milk.the study can also help the organizations
taking the project of farming specifically those that want to venture into the
dairy sector.

2.0 materials and method

 

2.1study area

kiambu county was
chosen as the area of study because of its proximity to nairobi city where the
market of milk is high and also the area consist mostly of dairy farmers.the
climate here has proven to be vital for both animal rearing and flourishing of
pasture for the animals.also the area is home to giant milk processors such as
freshier and other dairy cooperatives.since not all the small holder farmers
have the priveledge to work with either this processors or cooperatives some
resort to marketing on their own.thanks to technology they are able to change
from hawking milk to selling the milk in atms.

 

2.2 data
&sampling

primary data was colleced buy use of a questionnaire.a randome sample of 57
respondents was done mainly targetting those who operated or owned the milk
atms in kiambu county.the major

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3.0  RESULTS & DISCUSSION

characterization of
small holder farmers with milk atms

characterization of
small holder farmers helps in classifying farm household into similler or
different groups for which targeted policy intervention can be applied.

characterization of
the farmers and their households.

this can be
represented by a tables;

 

gender of respondent

 

Frequency

Percent

Valid Percent

Cumulative Percent

Valid

male

33

55.9

57.9

57.9

female

24

40.7

42.1

100.0

Total

57

96.6

100.0

 

Missing

System

2

3.4

 

 

Total

59

100.0

 

 

 

 

more than half of
respondents were male 55.9 %.this implies that marketing is male dominated
activity.this suggest that more male are aware of opportunities in marketing as
compared to female.

 

average price of milk

 

Frequency

Percent

Valid Percent

Cumulative Percent

Valid

60-65

15

25.4

26.3

26.3

65-70

33

55.9

57.9

84.2

above 70

9

15.3

15.8

100.0

Total

57

96.6

100.0

 

Missing

System

2

3.4

 

 

Total

59

100.0

 

 

 

 

 

the average range
of milk price was between 65-70 ksh .although few areas were selling above 70
ksh and this can be attributed to factors such as transport costs which are
likely to affect the price of milk.

majority of the
farmers sold between 20-30 litres of milk per day.atms are not targeted at a
large market thats why they are numerous in certain areas where the population
is high.however its noted that all the milk was sold in almost all areas that
the machines operated.so the farmers are said to have satisfied the milk
demand.

 

do you keep records of your business

 

Frequency

Percent

Valid Percent

Cumulative Percent

Valid

yes

34

57.6

59.6

59.6

no

12

20.3

21.1

80.7

sometimes

11

18.6

19.3

100.0

Total

57

96.6

100.0

 

Missing

System

2

3.4

 

 

Total

59

100.0

 

 

 

 

record keeping is
essential in all businesses because you can tell weather the business is
profitable.the  study shows that more
than half of the businesses keep records.records are also important in securing
loans.those keeping records were 57.6%

CONCLUSIONS &
RECOMMENDATIONS

the findings show
that here has been an increase in milk production however not all the milk is
sold.some of the milk goes bad since farmers are not able to access the
market.a large portion of milk is consumed in urban centres as compared to
production zones.to tackle this marketing problem use of milk atms is being put
into use.

in the finds ,also
the government plays an important role in regulation of the sector.licensing
,health requirements and also other rules such as pasturazation of milk have
helped in raising hygiene starndars in this industry.this has made it safe for
buyers.

Global milk demand
is growing , mostly in developing countries. Once this increased volume of milk
is being produced by small-scale dairy farmers, This presents a unique
opportunity for building up a sustainable dairy chain that sources milk from
smallholder dairy farmers to meet not only the demands of local consumers but
also those of the world market. While capitalizing on this opportunity could
generate significant wealth in rural areas and provide benefits to all
stakeholders involved in the dairy value chain, it calls for a sound dairy
development strategy.

To be successful,
any dairy development strategy should be based on the principle of ‘creating value’
in every segment of the dairy chain. This means that every player in the chain
(farmer, farm input supplier, milk traders, processors, retailers, etc.) makes
a profit, i.e. the returns are higher than the costs.

  Stakeholder consultation: a critical issue
here is to agree on goals for each segment of the dairy chain that ‘fit
together’ and are mutually supportive. Once the strategic goals (especially of
farmers and processors) are in line with each other, it would be desirable for
local governments, NGOs and other potential partners to become involved and
their capacities and roles in supporting the development process be considered.

    Risk management: given the increasing
volatility of milk and feed prices, there is a pressing need to incorporate
risk management systems into dairy development strategies. This is especially
important for the dairy farmers once they move from small-scale/ low-yield
operations to larger farms with more intensive production practices.

    Monitoring, evaluation and continuous
strategy improvement: the world is rapidly evolving, and agricultural
development is very dynamic with regard to farm structure, input prices, prices
for milk and dairy products, consumer perceptions, etc. It is therefore not
sufficient to start a dairy development programme with a sound strategy: it is
also necessary to constantly re-assess the chosen strategy against changing
external factors.

There is a need for
regular evaluations of each part of the dairy chain and for comparison with
counterparts in other dairy regions. This calls for professionals with
backgrounds in dairy supply chain management and dairy farm economics. The
knowledge created through such comparative studies should be translated into
continuous adaptation of the dairy chain to changing circumstances so as to
ensure the future prosperity of all the actors involved in the dairy sector.

REFERENCES