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Applying marketing channel theory to food marketing in developing countries: vertical disintegration model for horticultural marketing channels in Kenya

Dijkstra, T., Meulenberg, M., Tilburg, A. van.
Agribusiness 2001 v.17 no.2 pp. 227-241
agricultural products, horticultural crops, food marketing, marketing channels, economic theory, vertical integration, food industry, statistical analysis, trade, developing countries, Kenya
This article shows that marketing channel theory, which has been extensively applied in developed countries, can also be of great value to the developing world. Notably, the channel approach makes it possible to explain the number of trade levels observed in food marketing systems. We propose here a vertical disintegration model for horticultural marketing channels in Kenya. It contains one dependent variable (the degree of vertical disintegration of a channel) and five independent variables (the population size of the market center served by the channel, the population density of the rural hinterland of that market center, the transport time from farm to market center, the turnover of the retailer involved, and the keeping quality of the commodity traded). Binomial and multinomial logit analyses show that the probability of encountering a more disintegrated horticultural marketing channel increases when the market center has more inhabitants, when the center's rural hinterland is more densely populated, and when the transport to the center takes more time. The probability of encountering a less disintegrated channel increases when the retailer in the channel has a larger turnover and when the traded commodity is a leafy vegetable.