DECISIONAL FACTORS INFLUENCE

ORGANIC FOOD CONSUMPTION:

A CASE STUDY IN COLOMBO DISTRICT OF
SRI LANKA

W.V.H.L.ATHTHANAYAKA

DEGREE OF BACHELOR OF SCIENCE

HONOURS (AGRICULTURE)

FACULTY OF AGRICULTURE AND

PLANTATION MANAGEMENT
WAYAMBA UNIVERSITY OF SRI LANKA

2018
DECISIONAL FACTORS INFLUENCE ORGANIC FOOD CONSUMPTION:

A CASE STUDY IN COLOMBO DISTRICT OF SRI LANKA

A THESIS SUBMITTED

by

WANIGASINGHA VIDANELAGE HIMASHIKA LAKSHANI

ATHTHANAYAKA

to

FACULTY OF AGRICULTURE AND PLANTATION MANAGEMENT

WAYAMBA UNIVERSITY OF SRI LANKA

in partial fulfillment of the requirement

for the award of the

DEGREE OF BACHELOR OF SCIENCE HONOURS

(AGRICULTURE)

DECEMBER, 2018
 DECLARATION

I do hereby declare that this research thesis has been composed solely by me and the

work reported in this thesis describes the results of my own independent research. It

does not contain any material previously published or written by any other person

except where due references have been made in the text.

………………………. …………………………….

Date Signature of the student

This is to certify that this research thesis was prepared under my/our supervision by

Mr./Mrs./Ms……………………………………………………..for his/her degree of

Bachelor of Science Honours (Agriculture).

Certified by:

……………………………………..

Signature of the supervisor

(Dr.A.G.K.Wijesinghe)

(Senior Lecturer)

(Department of Agribusiness Management)

(Faculty of Agriculture and Plantation Management)

(Wayamba University of Sri Lanka)

Date: ………………………….
i
 ACKNOWLEDGEMENTS

I would like to mention my sincere thanks to those people who helped me to complete

my research project successful and writing of this thesis.

Foremost gratitude to my supervisor, Dr. A.G.K. WIJESINGHE, Senior Lecturer,

Department of Agribusiness Management, Faculty of Agriculture and Plantation

Management, Wayamba University of Sri Lanka, for guiding me throughout this

research project and for sharing her valuable time with me to guide me by giving

valuable ideas and suggestions to complete successfully my research project.

I wish to express my special gratitude to PROF. N.R.ABENAYAKE, Department of

Agribusiness Management, Wayamba University of Sri Lanka, for her statistical

analytical support and guidance provided on this research project.

I wish to offer my gratitude to PROF.J.C.EDIRISINGHE, Head of the Department and

all the staff members of Department of Agribusiness Management, Faculty of

Agriculture and Plantation Management, Wayamba University of Sri Lanka, for their

support.

Also my honorable mention goes to my loving parents for their blessing and enormous

support through my research project.

ii
 ABSTRACT

Organic foods are generally believed as safer to consume, nutritious, and

environmentally sound production. This study mainly focused to understand consumer

decision processes to buy organic foods. The main purpose of this study was to

recognize how the information revealed on organic food labels and perceived organic

knowledge influence attitudes and trust toward organic food purchase and also how

subjective norm drives toward organic food purchase intention. Primary data were

collected through a questionnaire survey by means of face-to-face interview from a

sample of 300 respondents covering five divisional secretariats in Colombo district.

Divisional secretariats were selected randomly. Data were analyzed by using Structural

Equation Modeling. The results revealed that consumer attitude is the main attribute that

influence organic foods purchase intention of the consumers. Further, results elaborate

consumers more concern on the health attributes of the organic foods. Also results say

that consumers have low trust on organic foods producing companies, farmers, vendors,

organic labels and certifiers. The study indicates that organic label doesn’t have a clear

profile to consumers. Thus they do not believe organic labeling provide correct,

sufficient and relevant information. The results show that respondents have low

knowledge on organic foods. Findings of this study are important to policy makers,

organic producers, vendors, marketers, certifiers and research institutions to implement

better strategies to develop the organic foods market as well as promote the organic

foods among the general public in Sri Lanka.

KEYWORDS: Attitudes, Organic foods, Purchase intentions, Revealed information,

Trust

iii
 TABLE OF CONTENTS

DECLARATION..........................................................................................................................i

ACKNOWLEDGEMENTS..........................................................................................................ii

ABSTRACT................................................................................................................................iii

TABLE OF CONTENTS............................................................................................................iv

LIST OF TABLES.......................................................................................................................v

LIST OF FIGURES....................................................................................................................vii

LIST OF ABBREVIATIONS....................................................................................................viii

CHAPTER 1................................................................................................................................1

INTRODUCTION........................................................................................................................1

1.1. Specific objectives.............................................................................................................2

1.2. Hypotheses of the study.....................................................................................................3
CHAPTER 2................................................................................................................................4

LITERATURE REVIEW.............................................................................................................4

2.1. What is Organic Agriculture?............................................................................................4

2.2. What are Organic foods?...................................................................................................4
2.3. The global organic foods market.......................................................................................4
2.4. Organic foods market in Sri Lanka....................................................................................5
2.5. Theoretical Background....................................................................................................5
2.5.1. Effects of attitudes on purchase intention...................................................................7
2.5.2. Effects of trust on attitudes and purchase intention....................................................7
2.5.3. Effects of revealed information on trust and attitudes................................................8
2.5.4. Effects of perceived knowledge on attitudes and trust................................................9
2.5.5. Effects of subjective norm on purchase intention.......................................................9
CHAPTER 3..............................................................................................................................11

MATERIALS AND METHODS...............................................................................................11

3.1. Conceptual framework....................................................................................................11

3.2. Data collection.................................................................................................................12
3.3. Measures.........................................................................................................................12
3.4. Data analysis...................................................................................................................14

iv
CHAPTER 4..............................................................................................................................15

RESULTS AND DISCUSSIONS..............................................................................................15

4.1. Descriptive statistics of the sample..................................................................................15

4.2. Measurement Model........................................................................................................16
4.3. Structural model..............................................................................................................19
CHAPTER 5..............................................................................................................................22

CONCLUSION..........................................................................................................................22

5.1 Limitations of the study....................................................................................................23

REFERENCES...........................................................................................................................24

APENDICES..............................................................................................................................28

Questionnaire.........................................................................................................................28

v
 LIST OF TABLES

Table Page

Table 3.1. Likert scale items which are reflected by the underlying construct and

observe variable name.....................................................................................................13

Table 4.1. Socio-demographic characteristics of the sample..........................................15

Table 4.2. Measurement model fit indices......................................................................17

Table 4.3. Properties of the measurement model............................................................18

Table 4.4. Structural model fit indices............................................................................19

Table 4.5. Standardized regression weights for the structural paths...............................20

vi
 LIST OF FIGURES

Figure Page

Figure 3.1.The proposed conceptual model....................................................................11

Figure 4.1. The measurement model...............................................................................16

Figure 4.2. The structural model.....................................................................................21

vii
 LIST OF ABBREVIATIONS

AGFI Adjusted Goodness-of-Fit Index

AMOS Analysis of Moment Structure
AVE Average variance Extracted
CDB Consumer Decision Model
CFA Confirmatory Factor Analysis
CFI Comparative Fit Index
EDB Export Development Board
GFI Goodness-of-Fit Index
RMSEA Root Mean of Squared Error of Approximation
SEM Structural Equation Modeling
TPB Theory of Planned Behaviuor
TRB Theory of Reasoned Action Behaviour

viii
 CHAPTER 1

INTRODUCTION

Organic foods are generally believed as safer to consume, nutritious, and

environmentally sound production. People believe that consumption of an organic food

product is the best remedy to prevent numerous health hazards caused by conventionally

produced food products. As the organic food market has recently increased

considerably, it is widely regarded as one of the biggest growth markets in the food

industry (Hughner et al., 2007). Further it has suggested consumers and marketers have

increased their interest towards organic foods due to the health and environmental issues

prevailing due to pesticides, other non-natural substances and genetically modified

organisms which are used to increase the agricultural productions.

Zanoli and Naspetti (2002) have mentioned health benefit is the strongest purchasing

motive in purchasing organic foods. Health consciousness can be defined as the

awareness of the healthiness in their diet and lifestyle. A research has revealed that

consumers buy organic foods because of their desire to avoid chemicals used in

conventional food productions. Further it says use of pesticides in food production is

perceived to be associated with long-term and short term unknown effects on health

(Hughner et al., 2007). According to the literature, many studies have investigated the

factors affect for motivation to organic food purchasing (Honkanen et al., 2006;

Magnusson et al., 2003; Padel and Foster, 2005).

Sri Lankan people are moving to healthy consumption with the improvement in living

standards such as increase in income and health consciousness. Sri Lankan consumers

have started to focus more on food quality rather than quantity and hence creating a

bigger chance for economically viable organic market (Atapattu and Wijesinghe, 2017).

1
Hughner et al. (2007) has elaborated the levels of knowledge in organic food have a

strong influence on purchasing intention in organic foods. As the organic market is

small and primitive in Sri Lanka, consumers generally have less awareness and

knowledge on organic products. Therefore, developing the trust on organic productions

is essential for enhancing organic food purchasing behaviours. Though there are

numerous researches about the factors affecting the organic food consumption, research

in relating to evaluate the factors that can support consumers to build up trust and

positive attitude towards organic foods or investigating how the combination of these

factors can rise up the organic food purchase is not sufficient.

Therefore, this research was focused to investigate how revealed information, perceived

knowledge, trust, attitudes, and subjective norms determine organic purchase intentions

of consumers. These findings will be helpful for the producers, vendors, marketers,

farmers, suppliers, policy makers, green restaurants and government to develop

effective strategies to improve the organic food market in Sri Lanka.

1.1. Specific objectives

The main objectives of the study are:

1. To examine how revealed information determine organic purchase intentions

2. To examine how perceived knowledge determine organic purchase intentions

3. To examine how trust determine organic purchase intentions

4. To examine how attitudes determine organic purchase intentions

5. To examine how subjective norms determine organic purchase intentions

2
1.2. Hypotheses of the study

The following hypotheses are considered in the study.

H1. Attitudes positively influence organic food purchase intentions

H2. Trust positively influences attitudes towards organic foods

H3. Trust positively influences organic food purchase intentions

H4. Information revealed on organic labeling positively influences trust in organic

foods

H5. Information revealed on organic labeling positively influences attitudes towards

organic foods

H6. Perceived knowledge positively influences attitudes towards organic foods

H7. Perceived knowledge positively influences trust in organic foods

H8. Subjective norms positively influence organic food purchase intentions

3
 CHAPTER 2

LITERATURE REVIEW

2.1. What is Organic Agriculture?

Organic agriculture can be simply defined as a sustainable form of agriculture for both

economic and ecological causes. The development trend of global organic agriculture

indicates a positive growth during past decades (Export Development Board). Organic

farming systems rely on crop rotation, animal and plant manures, some hand weeding

and biological pest control.

2.2. What are Organic foods?

According to the Institute of Food Science and Technology (2005) organics can be

simply defined as a product from farming system which has avoided use of pesticides

and synthetic fertilizers. Genetically modified organisms and antibiotics (Soil

association, 2000), hormones and irradiation (Lokie, 2004), growth regulators and

livestock feed additives (Institute of Food Science and Technology, 1999) are extremely

prohibited in organic standards but under certain conditions thirty types of additives are

permitted. Therefore, purchasing organics is actions motivated beliefs on healthiness,

positive impact on environment, good taste and welfare of production animals (Shafie

and Rennie, 2009).

2.3. The global organic foods market

Over the last decades organic food industry is one of the fastest growing sectors in the

world (Lokie et al., 2004). According to Burch, Lyons and Monk, 2002 the global

organic industry is estimated to be valued at nearly US$13 billion. Both USA and

Canada have rapidly growing organic foods market of 20% per year. Europe has 7.8%

of organic foods market per year (EDB).

4
2.4. Organic foods market in Sri Lanka

A huge expansion can be seen in the organic food industry. Organic suppliers and retail

grocers are interested on promoting organics to buyers in main stream grocery stores

(Reicks, Splett and Fishman, 1997). Sri Lankan consumers more concern on cleanliness,

degree of damages, packaging, freshness and convenience at purchasing when buying

organics (Rosairo, 2006). Sri Lanka export development board (EDB) indicates at first

Sri Lanka has introduced organically produced tea to the global market. After that Sri

Lanka has expanded this product range to non-traditional agriculture products like

cashews, spices, vegetables, rubber, tropical fruits, pulses, essential oils, herbal

productions oil seeds and herbs etc. Rosairo, (2006) indicates Sri Lankan organic

farmers produce organic foods mainly based on resources, their abilities, products and

production process further he is suggested it is hard to see customer oriented demand

driven production.

2.5. Theoretical Background

Theory of Reasoned Action Behaviour (TRA) explains subjective norm and person’s

attitude towards the behavior affect behavioural intension of a person while Theory of

Planned Behaviour (TPB) explains person’s behavioural intention depends on perceived

behavioural control and the above mentioned factors in TRA (Ajzen and Fishbein,

1980). Aerstnsens et al., 2009 has emphasized TPB is a relevant theory to understand

the consumer choice for organics. Both of TRP and TPB theories recognize consumer

behavioural intention as a critical antecedent of actual individual behaviour. It is

assumed that based on the available information to people, they attempt to build rational

decisions. This assumption is used to build up the relationship between consumer

behavioural intentions and the actual behavior (Ajzen and Fishbein, 1980; Teng and

5
Wang, 2015) further they explain consumers’ behavioural intention to perform or not to

perform behaviour is the immediate determinant of that person’s actual behaviour.

Both of those theories are used to define organic product consumption behaviour (Teng

and Wang, 2015; Dean et al., 2008; Saba and Messina, 2003).

Consumer Decision Model (CDM) suggests the key elements of product choice

behaviour, are, brand recognition, information sources, attitude, confidence, purchase

intention, and purchase actions (Howard, 1989). According to Gifford and Bernard,

2006, brand recognition is much more important to the consumers to assure product

quality. CDM emphasizes the messages from various information sources for buyers to

the brand recognition. The buyer’s longing to purchase a product is increased when

confidence and attitude are produced. When the desire comes to a certain level,

customers are more likely to buy products. Numerous studies (Demeritt, 2002; Pieniak

et al., 2010) are used CDM and they have indicated consumer recognition and

confidence which cause to increase purchase intention and attitudes can be enhanced by

improved production information.

This research has incorporated TRA, TPB and CDM to form the proposed conceptual

framework. The study focused on how the information revealed on organic food labels

and perceived organic knowledge influence attitudes and trust toward organic food

purchase and also how subjective norm drives toward organic food purchase intention.

As well as the research is carried out to examine consumer decision process to buy

organic foods in Sri Lanka.

The following sections explain the relationship among the variables in the proposed

conceptual model and the hypotheses build up in this research.

6
2.5.1. Effects of attitudes on purchase intention

TPB emphasizes the attitude as a key determinant of behavioural intentions. Numerous

research on organic food consumption has confirmed consumer attitude is positively

and significantly influence on organic purchase intentions (Aerstsens et al., 2009; Padel

and Foster, 2005; Honkanen et al., 2006; Saba and Messina, 2003). The related

literature suggest health, nutritional concern, safety of the food, animal welfare and

environmental friendliness are the attributes which relate to consumer attitude towards

organic foods (Honkanen et al., 2006; Magnusson et al., 2003; Poulston and Yiu, 2011).

Thus, this study has hypothesized;

H1: Attitudes positively influence organic purchasing intentions.

2.5.2. Effects of trust on attitudes and purchase intention

Trust is much more important in organic foods than regular foods. Trust is one of the

most effective tools to reduce consumer uncertainty (Hart and Saunders, 1997;

Aerstsens et al., 2009). Crosby et al. (1990) is suggested that cultivation of trust is

valuable when uncertainty and risk built-in and warranties are frequently absent. Not

only that but also after the consumption, consumer trust is a real issue in organic foods

market because customers can not verify whether the product is organic or not (Janssen

and Hamm, 2012). Thus, trust is a valuable component in organic purchasing as well as

trust influences on consumer attitudes.

Therefore, the study has hypothesized;

H2. Trust positively influences attitudes on organics.

H3. Trust positively influences organic food purchase intentions.

7
2.5.3. Effects of revealed information on trust and attitudes

Logos and labeling of organic foods can increase the market visibility and information

on organic foods. That helps to stimulate the trust and purchase willingness of the

consumers (Zakowska-Biemas, 2011). Zanoli and Naspetti (2002) claimed that the

differences occur between the groups of buyers with respect to the level of information.

Further they suggest, consumers want to know more information. Thus, organic

certification and organic labeling is a starting point and the information can be given

through how organic production and processing differentiate from conventional foods.

Both of the factors, reliable and clear information are critical things in the purchase

decision process. The benefits as well as relevant knowledge on organic food items

should be well communicated to the people, to allow them to get informed purchase

decisions based on the preferences and/or their budget (Vermeir and Verbeke, 2006).

According to Aerstsens et al. (2009), better communication is an essential component to

influence consumer trust. Thus, it helps to avoid consumers’ uncertainty on different

attributes of organic foods. Further he suggests, by providing of extra information on

production as well as the control process of organics help to reduce uncertainty and

increase consumer knowledge. The adequate information regarding organic food

products is play a major role to expand market demand of organic products because

those information can rise up the consumers’ trust and also the attitude towards the

organic food items (Gracia and Magistris, 2008).

Therefore the study has hypothesized;

H4. Information revealed on organic labeling positively influences trust in organic

foods

H5. Information revealed on organic labeling positively influences attitudes towards

organic foods
8
2.5.4. Effects of perceived knowledge on attitudes and trust

Vermeir and Verbeke, 2006 stated that better knowledge on organic products is

associated with high behavioural intentions. Increasing the organic knowledge is an

important tool to enhance organic foods consumption. Knowledge on organic foods

strongly influences attitude of the consumer which directly investigate decisions or

intention to purchase organic products (Magistris and Gracia, 2008). Padel and Foster,

2005 suggested knowledge of organic foods positively influences consumer attitude and

consumer perception on organic foods. Thus, the knowledge of organic products can

strongly affects for the purchasing decision of the consumers towards organic foods

(Yiridoe et al.,2005).

Vermier and Verbeke, 2006 claimed that most of the consumers have limited

knowledge on organic foods and the production process of organics. Also they have

lack of confidence and understanding of the implications of purchasing decisions.

Insufficient awareness and knowledge of organic foods act as main barriers to buying

organic products (Demeritt, 2002). Most of the consumers do not have a clear

understanding of the meaning of organics. Thus, consumer knowledge on organic is

major factor that influences on consumer trust and behavioural intentions.

Based on the above studies, this research has hypothesized;

H6. Perceived knowledge positively influences attitudes towards organic foods

H7. Perceived knowledge positively influences trust in organic foods

2.5.5. Effects of subjective norm on purchase intention

Teng and Wang, (2015) are defined subjective norm as the degree of social pressure

(family, friends, news and magazines and other significant factors) for a consumer to
9
accept or avoid the purchasing behaviour. Ha (1998) claimed that subjective norm is a

critical determinant of the encounter of social influence on the behavioral intention.

Numerous studies have also recognized subjective norm has significant and positive

impact on organic purchase of the consumer (Aerstsens et al., 2009; Chen, 2007; Dean

et al., 2008). The total set of accessible normative standardized beliefs on the

expectations of valuable denotations for the concern of individual are used to determine

subjective norm (Ajzen, 2002). Consumers attitudes can be used to predict consumer’s

intention to buy organics and further buying intention can be predicted by subjective

norms (Tarkiainen and sandqvist, 2005).

Thus, the study has hypothesized;

H8. Subjective norms positively influence organic food purchase intentions

10
 CHAPTER 3

MATERIALS AND METHODS

3.1. Conceptual framework

The proposed conceptual framework (Figure 3.1) explains the relationship among

revealed information, perceived knowledge, attitude, trust, subjective norm and organic

purchase intention.

Figure 3.1.The proposed conceptual model

Hypothesized relationships are indicated by arrows.

11
3.2. Data collection

A structured questionnaire survey was conducted to gather primary data from the study

population. In general organic foods market is yet undeveloped and relatively new and

they are only available at the major supermarkets in Sri Lanka. Thus, this study was

administered at randomly selected six supermarkets representing 2 Arpicos, 2 Keels

Supers and 2 Cargills food cities from each selected divisional secretariat. Five

divisional secretariats were selected randomly. Data were gathered from 300 consumers

at selected supermarkets. Customers were selected based on systematic sampling by

interviewing each 5th customer arrived to the super market.

3.3. Measures

The questionnaire was consisted seven sections that are Personal information of the

consumer, revealed information, perceived knowledge, subjective norm, attitude, trust

and purchase intention of organic foods.

Twenty four items (Table 3.1) were used to assess these six constructs other than

personal information. All items in the questionnaire were assessed using a seven-point

likert-type scale, ranging from 1 to 7, where 1 was denoted “strongly disagree”, and 7

was denoted “strongly agree”.

Table 3.1. Likert scale items which are reflected by the underlying construct and
observe variable name
12
Construct Variable Name Questionnaire item

Revealed RI_1 Organic labeling provides correct information on

Information organic foods.

RI_2 Organic labeling provides sufficient information.

RI_3 I am satisfied with the information that organic labeling

provides.

Perceived PK_1 I’m personally very knowledgeable about organic foods.

Knowledge

PK_2 The average person in Sri Lanka is very knowledgeable

about organic foods.

PK_3 The food industry is very knowledgeable about organic

food.

Subjective Norm SN_1 My family thinks I should buy organic foods.

SN_2 My friends think I should buy organic foods.

SN_3 News and magazines affect my purchase decisions of

organic foods.

SN_4 Government supports for organic foods affect my

decisions to buy organic foods.

Attitudes A_1 Organic foods have lower chemical residues than

conventional foods.

A_2 Organic foods are safer to eat than conventional foods.

A_3 Organic foods are healthier to eat than conventional

foods.

A_4 Organic foods are tastes better than conventional foods.

A_5 Organic foods have superior quality than conventional

foods.

A_6 Organic foods are more expensive to eat than

conventional foods.

Trust T_1 I think that corporations in the field of organic foods are
aware of their responsibilities.

T_2 I think the organic farmers are aware of their

responsibilities.

T_3 I trust those who sell certified organic foods indeed sell
quality organic foods.

T_4 I trust a quality organic food label or logo.

T_5 I trust the institutions certifying organic food products.

Purchase PI_1 If organic foods were available in the shops, I would

13
 Intention buy them.

PI_2 I am willing to buy organic foods despite their higher

prices.

PI_3 The probability I would buy organic foods is very high.

3.4. Data analysis

Structural Equation Modeling (SEM) was used in this study to examine the proposed

model by using Analysis of Moment Structure (AMOS) in SPSS 16 version. Descriptive

statistics were used to analyze the demographic factors of the sample. Reliability of the

instrument was calculated by using Cronbach’s Alpha Reliability Coefficient.

The model consisted of two components as measurement model and a causal structural

model (Jayasinghe-Mudalige et al., 2015; Byrne, 2016). As suggested by Byrne (2016),

Confirmatory Factor Analysis (CFA) was carried out to determine whether all observed

variables (Indicator variables) appropriately reflect their underlying constructs (Latent

variables) and whether the measurement model has acceptable fit to the data. After that

Path Analysis was used to examine the predicted causal relationship among the latent

constructs (Byrne, 2016). It also recognized the indices that could determine whether

the model provides acceptable fit to the data.

14
 CHAPTER 4

RESULTS AND DISCUSSIONS

4.1. Descriptive statistics of the sample

Majority of the respondents were women (61 %) and 39 % were men and out of that

79.7 % were married in the studied population (Table 1). Population contained 45 %

and 37.7 % in the age group of 30-49 and above 50 respectively. Among the sample

population, 14.3 % of the respondents had primary education and others had above that

level. Majority of the sample was in the tertiary education level (50 %). 36.7 %

respondents had four members in their family. In the survey population, 59.3 % were

employed and 47.7 % were among the income level of above LKR 50,000.

Table 4.2. Socio-demographic characteristics of the sample

Parameter Category Percentage (%)
Gender Male 39
Female 61
Age 15-29 years 17.3
30-49 years 45
50 and above 37.7
Employment Status Unemployed 40.7

Employed 59.3
Monthly Income Less than 15,000 3.3
15,000-34,999 13.3
35,000- 59,999 35.7
Above 59,000 47.7
Educational Level Primary 14.3

Secondary 35
Tertiary 50
Civil Status Unmarried 20.3
Married 79.7

15
4.2. Measurement Model

All 24 statements which were used as indicators showed that the model fit was

insufficient to proceed with the same set of indicators. Thus, it was pruned three

indicators (PK_1, SN_1 and SN_3) which had low factor loadings (below 0.05) and

insignificant (at p=0.05). After that, the revised model was re-estimated and the results

indicate in the Table 2. Cronbach’s alpha (0.773) was used to assess the internal

consistency of the likert scale items. According to Hair et al. (1998), it is acceptable

when Cronbach’s alpha is higher than 0.7.

Figure 4.2. The measurement model

16
Composite reliabilities of all constructs except perceived knowledge were higher than

the threshold value 0.7 (Hair et al., 1998). The composite reliability of perceived

knowledge was marginally below 0.6, thus signifying that all constructs have adequate

reliability (Table 2). The AVE of perceived knowledge, attitude and trust were below

the suggested value 0.5 but other three had estimates above 0.5. Composite reliability

and AVE indicate that the overall measurement model has good convergent validity.

CFA was used to validate the proposed model constructs. It assessed the overall quality

of the measurement model. Maximum likelihood method was used to estimate the

measurement model. Model fit was assessed by using Multiple Fit Indices (Table 3).

Chi-square value (283.092) for the model was statistically significant, χ2/df = 1.656; a

root mean of squared error of approximation (RMSEA) = 0.047; goodness-of-fit (GFI)

= 0.918; adjusted goodness-of-fit (AGFI) = 0.889; comparative fit index (CFI) = 0.941.

According to Hair et al. (1998), the fit indices indicate good model fit.

Table 4.3. Measurement model fit indices

Measurement
Model Estimates
Chi-square ¿2) 283.092
df 171
Probability Level 0
χ 2/df Ratio 1.656
CFI 0.941
GFI 0.918
AGFI 889
RMSEA 0.047

The CFA results listed in Table 2 show that standardized estimates are statistically

significant except PK_3 indicator variable. It was revealed that the indicators effectively

reflect each latent variable except PK_3 indicator variable.

17
RI_3 indicator shows the highest factor loading (0.82) towards revealed information

which indicates relevant information of the organic label highly reflect (by 82 %) the

underlying construct of revealed information. Government support for organic foods

(SN_4 indicator) highly reflect (table 2) the factor of subjective norm by 73.8 %. A_3

observed variable shows higher estimate (0.949) towards attitude to organic foods

which shows healthiness of organic foods highly reflect attitude of the respondent by

94.9 %. Results show that organic food label (T_4 indicator) highly reflect the

underlying construct trust by 83.5 %. The indicator variable of PI_3 shows higher factor

loading (0.815) towards the latent variable of purchase intention that indicates higher

probability of buying organic foods highly reflect the underlying construct purchase

intention by 81.5 %.

Table 4.4. Properties of the measurement model

Construct Estimate Composite Average
Reliability Variance
Extracted
(AVE)
Revealed 0.812 0.593
Information
RI_1 0.626
RI_2 0.799***
RI_3 0.820***
Perceived 0.527 0.363
Knowledge
PK_2 0.146
PK_3 1.264
Subjective Norm 0.709 0.550

SN_3 0.583
SN_4 0.738***
Attitudes 0.782 0.498
A_1 0.249
A_2 0.895***
A_3 0.949***
A_4 0.315***
A_5 0.645***
A_6 0.245**
Trust 0.813 0.466
T_1 0.644
T_2 0.509***
T_3 0.652***
T_4 0.835***
T_5 0.560***
18
 Purchase 0.833 0.635
Intention
PI_1 0.732
PI_2 0.735***
PI_3 0.815***
** Significant at P < 0.01, *** Significant at P < 0.001

4.3. Structural model

The study proposed to determine a conceptual model to understand how does the

revealed information of organic labeling, perceived knowledge influence on trust and

attitude towards consumers’ organic purchasing intention and also how subjective norm

influence on organic purchase intention. It mainly focused on consumer decision

process to buy organic foods.

The Structural model fit was assessed by using multiple fit indices (Table 3). Chi-square

value (294.465) for the model was statistically significant, χ2/df = 1.683; a root mean of

squared error of approximation (RMSEA) = 0.048; goodness-of-fit (GFI) = 0.914;

adjusted goodness-of-fit (AGFI) = 0.886; comparative fit index (CFI) = 0.938.

According to Hair et al. (1998), the fit indices indicate good model fit.

Table 4.5. Structural model fit indices

Structural Model Estimates

Chi-square ¿2) 294.465

df 175

Probability Level 0

χ 2/df Ratio 1.683

CFI 0.938

GFI 0.914

AGFI 0.886

RMSEA 0.048

19
Path analysis (Figure 2) was used to perform hypothesis testing. The path analysis

demonstrates that attitudes to organic foods significantly (Table 4) and positively

enhance consumers organic foods purchase intention (Table 4), thus supporting H1.

Consumer attitude (mean= 5.88) was measured by using six statements which asked

about the chemical residues, safeness, healthiness, taste, quality and premium price of

the organic foods. The results indicate that consumer attitude is the major factor that

influence on the consumer organic foods purchase intention. Healthiness of the organic

foods highly reflect consumer attitude to organic food. Most of the studies have

suggested that health benefits are the main motive for organic foods purchasing

(Mangusson et al., 2003; Zanoli and Naspetti, 2002, Padel and Foster, 2005). The

results indicate that trust does not significantly impact on attitude and organic purchase

intention, thus reject H2 and H3 (Table 4).

As organic foods relatively new to Sri Lanka, the consumers have low trust

(mean = 3.93) in organic food producers, organic farmers, venders, organic labels and

certifiers.

Table 4.6. Standardized regression weights for the structural paths

Hypothesized Relationship Estimates

Purchase intention  Attitudes 0.357***

Attitude  Trust 0.498

Purchase intention  Trust 0.107

Attitude  Perceived knowledge -0.592

Attitude  Revealed information 0252

Trust  Revealed information -0.030

Trust  Perceived knowledge 0.900

Purchase intention  Subjective norm -0.043

*** Significant at P < 0.001

20
Figure 4.3. The structural model

Therefore, the government, producers, policy makers, farmers, marketers and suppliers

should implement better strategies to increase consumer trust towards organic foods.

Revealed information does not significantly impact on attitude and trust, therefore reject

H4 and H5. Perceived knowledge also does not significantly impact on attitude and

trust, thus H6 and H7 were rejected. There is no significant impact on organic purchase

intention thorough subjective norm, thus reject H8 (Table 4). This indicates that Sri

Lankan consumers tend to buy organic foods based on their attitudes towards organic

foods.

21
 CHAPTER 5

CONCLUSION

This research provides several recommendations at policy level as well as industry

level. As in general organic foods are relatively new to the Sri Lankan consumers, they

have low awareness on organic foods. Thus the government, marketers, research

institutes, certifiers and producers should provide correct knowledge on organic foods

as well as credible information through diversified channels like newspapers, TV,

research papers, magazines, websites and workshop etc. Those things can support to

enhance the consumer trust towards organic foods as well. If the consumers have good

understanding regarding organic agriculture and organic food production process, it can

generate more confidence in recognizing organic foods.

The study indicates that organic label doesn’t have a clear profile to consumers. It is the

government responsibility to set policy formulations to regulate proper labeling

requirements for organic foods. Through that the organic certifying agents can certify

organic foods by offering organic labels which represent clear information and quality

to the customers. Credible labeling information can be given by displaying how organic

foods are grown processed and handled and the organic ingredients percentage in a

product. There should have some programs to increase the awareness and trust in the

general public towards the organic certification standards as well as the organic

certifying agents. Padel and Foster (2005) have suggested the reason for limiting

organic market share is the huge price difference between organic foods and

conventional foods. Premium price, low trust and the limited awareness on organic

foods are the main barriers to the organic market. Organic food sectors and marketers

have to focus on promoting benefits and accessibility of organic foods to the general

public to enhance consumer recognition and common acceptance.

22
5.1 Limitations of the study

There are some limitations in this study that need be fixed. Since the data were gathered

from Colombo district of Sri Lanka, future studies focus on samples from other districts

in Sri Lanka is important to investigate the Sri Lankan consumers’ decision process on

buying organic foods. Further, future studies focus on other countries is valuable for

conduct a cross cultural comparison. As the data were collected from the consumers in

selected super market outlets in Colombo district that may not fully reflect the

demographic factors of the target population. Thus, future studies may use better

sampling techniques to expend the sample size to be more representative.

23
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27
 APENDICES

Questionnaire

Ref No: ……………………………… Date: ………………

Survey on Decisional Factors Influence Organic Food Consumption

Department of Agribusiness Management, Faculty of Agriculture and Plantation
Management,

Wayamba University of Sri Lanka

Investigators : Dr. Kusum Wijesinghe & Himashika Aththanayaka

Purpose of the questionnaire is to measure the Decisional Factors Influence Organic

Food Consumption attitude in Colombo district.

 Please be kind enough to spend 15 minutes in filling this questionnaire. Please

feel free to provide the true data & idea. This will not reveal any confidential
data to any outside party.
 Please put a tick “” in the appropriate question box given below.

1) Gender
Female Male

2) Age of the household in years

Less than 15 years

15 – 29 years

30 – 49 years

50 and above

3) Employment status

Unemployed Employed

28
 4) Monthly income of the household in LKR
Less than LKR 15,000

LKR 15,000 - LKR 34,999

LKR 35,000 - LKR 59,999

LKR 60,000 and above

5) Educational Level
Primary Education

Secondary Education

Tertiary Education ( Degree and above)

6) Civil Status
Unmarried Married

7) Number of family members

 Please put a “×” on the correct number according to your most

preference answer for the following statements.
1= Strongly Disagree
2= Disagree
3= Slightly Disagree
4= No Idea
5= Slightly Agree
6= Agree
7= Strongly Agree
4. No Idea
2.Disagree

6. Agree

Questions
1.Strongly

3.Slightly

5.Slightly

7. Strongly
Agree

(1) Revealed information:

Disagree

Agree
Disagree

1. Organic labeling provides 1 2 3 4 5 6 7

correct information on organic
foods.
2. Organic labeling provides 1 2 3 4 5 6 7
sufficient information.

29
 3. I am satisfied with the 1 2 3 4 5 6 7
information that organic
labeling provides.

(2) Perceived knowledge:

1. I’m personally very 1 2 3 4 5 6 7

knowledgeable about organic
foods.

2. The average person in Sri 1 2 3 4 5 6 7

Lanka is very knowledgeable
about organic foods.

3. The food industry is very 1 2 3 4 5 6 7

knowledgeable about organic
food.
(3) Subjective norm:

1. My family thinks I should buy 1 2 3 4 5 6 7

organic foods.

2. My friends think I should buy 1 2 3 4 5 6 7

organic foods.

3. News and magazines affect my 1 2 3 4 5 6 7

purchase decisions of organic
foods.

4. Government supports for 1 2 3 4 5 6 7

organic foods affect my
decisions to buy organic foods.

(4) Attitudes:

1. Organic foods have lower 1 2 3 4 5 6 7

chemical residues than
conventional foods.

2. Organic foods are safer to eat 1 2 3 4 5 6 7

than conventional foods.

3. Organic foods are healthier to 1 2 3 4 5 6 7

eat than conventional foods.
4. Organic foods are tastes better 1 2 3 4 5 6 7
than conventional foods.

5. Organic foods have superior 1 2 3 4 5 6 7

30
 quality than conventional
foods.

6. Organic foods are more 1 2 3 4 5 6 7

expensive to eat than
conventional foods.

(5) Trust:

1 2 3 4 5 6 7
1. I think that corporations in the
field of organic foods are
aware of their responsibilities.

2. I think the organic farmers are 1 2 3 4 5 6 7

aware of their responsibilities.
3. I trust those who sell certified 1 2 3 4 5 6 7
organic foods indeed sell
quality organic foods.
1 2 3 4 5 6 7
4. I trust a quality organic food
label or logo.
1 2 3 4 5 6 7
5. I trust the institutions
certifying organic food
products.

(6) Purchase intentions:

1 2 3 4 5 6 7
1. If organic foods were available
in the shops, I would buy
them.
1 2 3 4 5 6 7
2. I am willing to buy organic
foods despite their higher
prices.
1 2 3 4 5 6 7
3. The probability I would buy
organic foods is very high.

31