An assessment of the perceived benefits and challenges in collaborative agri-bussiness arrangements among small holder farmers in Zimbabwe

Abstract

To ensure successful integration of the agribusiness sector, collaborative arrangements should be a strong incentive as they can be a solution to the high transaction costs in the imperfect markets found in conflict-affected countries, fragile states and least developed countries. Despite the importance of collaborative arrangements in agribusiness, there has not been a general consensus among researchers on the benefits and challenges encountered in such arrangements. The study seeks to assess perceived benefits and challenges to smallholder farmers so as to address issues of significance for the survival of the agribusiness sector. This study employed quantitative survey methods to gather data and Factor Analysis to extract the important benefits and challenges key to the smallholder farmers in these arrangements. Results of the study showed that collaborative arrangements have significant benefits (which include increased revenue, improved access to credit and diversification) that also come with challenges (like increased risk, over reliance on advances and side marketing) for the small-scale farmers and the particular benefits and challenges encountered offer an improved understanding of collaborative arrangements in the Zimbabwean context. The study recommends critical considerations of the benefits and challenges so as to address current deficits that include food security issues.