CHAPTER 4: DATA ANALYSIS RESULTS, INTERPRETATION AND DISCUSSION

4.1 Introduction

This chapter presents the analyzed data seeking to address specific objectives and research
questions of the study.40 small scale farmers from Tebesonic location were interviewed. The
key variables were captured using structured questionnaire. The dependent variable market
choice outlet was captured by asking farmers their preferred market and why? The options
were either KTDA or Multinationals. In addressing the objectives, the chapter first reviewed
the factors that affect the choice of tea market outlets in Tebesonik location.
Table 4.1 Descriptive characteristics of smallholder tea farmers in tebesonik location.
variables mean Std deviation Max Min
Education 11.35 3.589 University level Standard 4
Age(years) 39 12.32 70 20
Household size 5.425 1.9090 10 2
Distance to 2.72 5.58 60 2
output
market(km)

From the table above, it clearly stipulate that the mean educational attainment is 11.35 with
the maximum level being university graduates and the minimum being standard 4. From the
sample it indicates that most of the respondents are literate as reflected by educational
attainment which was vital for decision making. The mean age was 39years, with 12.32 as the
standard deviation. The younger farmer had 20 years and the old farmer had 70 years old.
The sample also depicts that the highest household size had 10 members with the lowest
having 2 members. The mean of the household size is 5.425 with 1.9090 as the standard
deviation. Lastly the research shows that the maximum distance to the output market in km
was 60km and the minimum was 2km with the mean of 2.32 and standard deviation of 5.58
4.2 Demographic information

The study reviewed the socio-economic variables of the households, Gender, Education level,
Marital status and market characteristics of smallholder tea farmers
4.2.1 Education

This presents the education background of smallholder tea farmers in Tebesonic location.
Education is necessary in enhancing sustainable economy and livelihoods, therefore,
investments in education with training is very important as it will improve their ability to
seek more information on agriculture and adoption of agricultural innovations
The results from the study show that 12(30%)5(12.5%) had a university degree, 10(25%)
were high school leavers among the sample size and majority of farmers are primary dropouts
as indicated by research 13(32.5%)
NB: Results also show that majority of farmers who are supplying their produce to KTDA
were less educated, compared to farmers supplying to Multinational companies since they
are well equipped with price differentials between the two companies.
 education level

5
9%
13
22%
10
17%

30
52%

Findings also shows that 56.6% of the smallholder tea farmers have attained primary school
education which reflect the National figures whereby more than a half of the population had
attained primary school education (NISR,2012a).
4.2.2 Age of the households

Most smallholder tea farmers were aged between 31-50 years old which represents 60% of
the sample size followed by participants aged below 30 years which represents 25% of the
sample size and least were farmers aged above 51 years old which represents 15%, the
younger farmer is aged 20 years and the older farmer had 70 years, the mean results show
that majority of young farmers age were middle aged as depicted by the mean of 39 yrs. with
standard deviation of 12.32. In Tebesonik location, young farmers supply their tea produce to
multinational companies since they are aware of the price differentials between KTDA and
these multinationals while old farmers were supplying theirs to KTDA. This was advantage
to the study because the research would be able to understand the factors affecting the choice
of market outlet and one of it being age.
 age of the household
70%

60%

50%

40%

30%

20%

10%

0%
21-30 31-50

Column3

4.2.3 Gender

Upon review, majority of the smallholders’ farmers are male 33(82.5%) compared to female
participants who were 18.5% a trend that was established because most male farmers are
households head and make decisions since they are owners of farms for farming and livestock
rearing. Male farmers are influencing decisions to sell to a particular company hence it is
essential for my study as it enable me to analyze factors affecting the choice of market outlet
to sell. The small percentage of women among the sample size of farmers may be accredited
to the general attitudes and culture among African countries, they believe that agriculture is
for the male and women are expected to perform domestic activities in the households.

gender

male females
4.2.4 Marital status

With regards to marital status, results show that, majority of small holders Tea farmers were
married (68%), while the least population were not married (32%) The high percentage of
married people can be accredited the fact that most responded were family oriented, this
could also be viewed as a true reflection of their age groups. In terms of household size, it
was shown that farmers with largest household’s sizes had 14 members while farmers with
smallest households’ sizes had 2 members. Most of the households had an average of five
persons in the family, this is incline with the Kenya National mean of five persons per
household’s head (CBS,2005)
Marital status is a factor which contributes significantly towards analyzing factors affecting
the choice of a market to sell in the married households are able to make better and wise
decisions with regards to the market to sell their produce as compared to unmarried
households.
4.3 Market characteristics.

One of the specific objectives was to ascertain the market factors affecting the choice of
market outlets for smallholder tea farmers.
These sections provide the results of market characteristics such as prices of the tea produce
in the market, Distance to the market and availability of market information. Those are the
variables of market characteristics that I analyzed.
4.3.1 Prices of the tea produce.

Price predicted favorably farmers decision on the market to sell green tea to price
differentials between the KTDA and Multi-national companies was a key variable in
determining the market characteristic of smallholder tea farmers.
Analysis was tabulated as follows;
Price per kg of tea leaves per month for the last 5yrs. (from 2016-2020)
years KTDA (shs) Sazini (shs)
2020
2019
2018
2017
2016

From the table above, it can be deduced that the multinationals companies offer higher gate
prices per kg of tea leave compare to prices offered by KTDA per month. Though this price
of multinational is lower than what KTDA financially pay as bonus at the end of each
financial year. In a way, farmers selling to sazini company loose substantially since they
forego the future earnings in the form of bonuses. This price difference was significant to
influence farmers to forego the bonus payment that comes with supplying to KTDA. farmers
are interested with the current value of money because uncertainties associated with the
future payments hence important for my study.
4.3.2 Availability of market information

Having the market information is believed to be one of the main mechanisms for economic
growth. All participants identified that the specific marketing information needed for farming
activity included agricultural input product, input supply and agricultural management
practices and information regarding to the market prices. Farmers reported that they face a
problem of information asymmetry.
This according to irungu et al. (2015), are the main agricultural information that a farmer
required. Accessibility of market related information are the major factors affecting the
choice of market outlets to sell their tea produce. Jari (2009) stated that availability of market
information boosts confidence of households who are willing to participate in the market and
affect market outlet.
Majority of smallholder farmers at tebesonic location have access the electronic gadgets like
the smartphones, radios and some have televisions. Research showed that 68%of smallholder
farmers had adopted smartphones and this enabled them to access market information like the
market prices per kilogram and therefore they are able to make choices on where to sell their
tea leaves to. Majority of the small scale tea farmers supply their tea leaves to Multinational
companies due to the fact that they are well conversant with the high prices offered by
Multinational companies during end month.32% of the sample have less market information
on the price differentials between KTDA. availability of market information contributed
significantly to my research topic in analyzing factors affecting the choice of market outlet by
smallholder tea produce at Tebesonik location
4.3.3 Distance to the market

Distance to output market is crucial in decision making by smallholder farmers to either sell
their tea produce to KTDA or Multinational companies. Distance is measured using kms or
walking minutes.
Research showed that24.75%of farmers in tebesonic location were located in moderate
distance to output the market,18.18%of farmers were located in inaccessible distance to
output market and majority 57.07%of farmers were located in accessible distance to the
market. Reduced distance for smallholder tea farmers implies that there is less transaction
costs in transporting their tea produce ,less time used in transportation of tea produce
.Multinational companies for instance sazini collects tea produce at farmers gate therefore
reducing the transaction costs for farmers and hence smallholder farmers prefer to sell to
those Multinationals rather KTDA since farmers do not incur any transaction cost unlike
KTDA where farmers have to take their tea produce to tea buying center therefore incur huge
transaction cost.
4.4 Regression model.

Regression model is a set of statistical method used for estimating the relationship between
the dependent variables and independent variable i.e., how the socio-economic factors and
market characteristics affect the choice of market outlet to sell.
 Table 4.4 Probit Regression Analysis
Market outlets Coef. St.err. t-value p-value [95% Conf Interval] Sig

Age of the respondent -2.523 1.015 -2.49 .013 -4.513 -.534 **

Market distance -.602 .381 -1.58 .114 -1.348 .144
Household size .269 .182 1.48 .14 -.088 .626
Gender -1.114 .549 -2.03 .042 -2.189 -.039 **
Education level -.116 .064 -1.82 .068 -.241 .009 *
Marital status -.174 .511 -0.34 .734 -1.176 .829
Availability of market 1.651 .724 2.28 .023 .231 3.071 **
information
Constant -100.831 42.014 -2.40 .016 -183.177 -18.484 **
Mean dependent var 0.650 SD dependent var 0.483
Pseudo r-squared 0.368 Number of obs 40
Chi-square 19.711 Prob > chi2 0.020
Akaike crit. (AIC) 52.756 Bayesian crit. (BIC) 69.644
*** p<.01, ** p<.05, * p<.1

A unit increase in age reduces the chances of using Sasini as the market outlet by a margin of
-2.523. those who are aged do not travel longer distances hence can opt for KTDA. Age was
statistically significant at 10% level of significance. A unit increase in market distance
reduces the chances of selecting Sasini as the market outlet -0.602 as compared to KTDA.
Chances of adopting KTDA increases because Sasini seems to be distant. A unit increase in
household size increases the chances of adopting Sasini as the market outlet by 0.269 as
compared to KTDA. Being female reduces the chances of selecting Sasini as the market
outlet by -1.114. Gender was statistically significant at 10% level of significance. A unit
increase in the level of education reduces the chances of selecting Sasini as the market outlet
by -1.114. Education level was statistically at 5% level of significance. Educated fellows
have better knowledge of prices and tend to go for better prices. Being married reduces the
chances of using Sasini by -0.174 as compared to KTDA. Marital status had negative
influence on the choice of market outlets. Availability of market information increases the
chances of selecting Sasini as the market outlet by 1.651. market information was statistically
significant at 10% level of significance. This means availability of information has a strong
influence on the choice of selecting Sasini as the market outlet.
Conclusions
Availability of market information had a positive and significant influence on the choice of
market outlets, while education level, age and gender had negative but significant influence
on the choice of market outlets. However, market distance and marital status had a negative
and insignificant influence on the choice of market outlets. Household size had a positive but
insignificant influence on the choice of market outlets.
 CHAPTER 5: CONCLUSIONS AND RECOMMENDATIONS

5.1 conclusions
The purpose of the study is to investigate factors affecting the choice of market outlets by
smallholder tea farmers at tebesonik location. A sample of 40 participants took part in the
study and responded to my research questionnaire. The findings showed a strong
indication that farmers are gradually shifting from KTDA to sazini tea company. The
emergence of these multinationals’ tea companies increases the farmer preference. the
reasons behind increased preference for multinationals are; prompt in payments (KTDA
pays on monthly basis) while sazini pays as per the demands of farmers. i. e daily
payments would be possible, multinational tea companies are also flexible in their tea
collection process as they collect at farm gates therefore reducing huge transaction costs
associated with transportation, sazini also do not impose strict quality requirement unlike
the KTDA whose code is the bud and two leaves anything beyond that is rejected.
Demographically, the male farmers in tebesonik location were more than the female
farmers with representation of 82.5% a trend that was reported because male farmers are
heads of household and owners of land and other resources with few women assuming the
roles. Further most of the sample population are married (68%) this was accredited to the
fact that most responded are family oriented and better decisions are made since the
family members have to reach an agreement.
From the sample population, most of smallholder tea farmers are age between 31-50 years
(60%). These results were attributed to educational attainment as these farmers were
relatively educated with 42.5% having attained university degree or vacation training
college. From these results it evident that farmers supplying their tea produce to
multinational for my case sazini, were young, have access to smartphones and well
educated therefore they are well conversant with price differentials between the two
companies because of availability of market information which enabled smallholder
farmers to make decisions.
In a way, it is clearly portrayed that farmers selling to sazini tea company loose
significantly since they have to forego the bonus payments that comes with supplying tea
to KTDA. Multilinear regression model was employed due to the fact that my dependent
variables were many.i.e.
The results from the study affirms that the socio- economic characteristic (age, gender,
education level and marital status) significantly influence the choice of market outlets.
also, market characteristics (price differentials, the distance to the output market and
availability of market information) play a key role in determining which market outlet to
sell their tea produce.
5.2 Recommendations
The following were the recommendations made about my study;
1. The national government and the county government should be responsive in
construction of rural roads to reduce huge transportation costs for smallholder tea
farmers.
2. There is also need for national survey to find out the extend of penetration among the
multinational tea companies into the small holder tea subsector.
3. KTDA should be flexible in their tea collection, they should not only collect their tea
produce at tea buying centers but also at the farm gates.
4. There is need to make each tea factory independent like the multinationals firms to
increase market competitiveness in tea subsector since its factory management will be
directly responsible to its farmers monthly prices.
5. There is need to restructure KTDA and make it responsive to financial needs
smallholder tea farmers. i. e reducing duration of bonus payments to maximum of
four months
6. There is need to find the extend of quality differences between KTDA tea produce
and tea from multinational companies and how this difference affects competitiveness
of tea in the market.
7. There is need to empower women through education as this will enhance knowledge
and increase their chances of making choices.
8. There is need to increase access to market information since it was found to have
positive influence on the choice of market outlets.
9. Enhancement of farmers education and literacy levels by the relevant marketing
agencies.
10. Opening of sub-branches near the farmer by Sasini will reduce distance to be covered
by the farmers.
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