Structure, conduct and performance of the marketlng system for cutflowers in Kenya: the case for statice flowers

Abstract

Cutflowers produced and exported from Kenya contribute a significant proportion of the foreign exchange earnings from all exported horticultural crops. Many studies have been undertaken on other horticultural crops but only a few of them have examined the marketing of cutflowers. There has therefore been a wide information gap in as far as the marketing system of culflowers in Kenya is concerned. Hence the need for this study so that information on the marketing system for cutflowers can be provided. The objective of the study was to establish the type of market structure in which cutflower sellers and buyers operate. The study utilized both primary and secondary data. Primary data were obtained through interviews of cutflower exporters and local traders. Secondary data were obtained from Horticultural Crops Development Authority statistical reports and publications and Ministry of Agriculture Annual Reports. The results of the study indicate that the cutflower marketing system is largly controlled by the private sector with the public sector having a limited role. The marketing system is divided into two sections, namely the export market and the domestic market. The export market Is characterized by a high degree of concentration and inequality with only two firms (controlling 70 percent of the total marketed cutflowers. This indicates the existence of oligopolistic market structure . The domstic market on the other hand is characterized by a low degree of concentration and low inequality thus suggesting the existence of a competitive market structure. The lack of adequate air cargo space and Iack of appropriate storage facilities were found to be some of the major problems that exporters of cutflowers were experiencing. Local cutflower retailers also were experiening problems of lack of appropriate business premises and storage facilities. The study recommends that market, conditions in foreign countries be explored and communicated to all cutflower exporters. There is need to increase the air cargo space available in order to have more exporters participating in the export, market. The deterioration of quality of cutflowers should be minimized by the provision of adequate and appropriate storage facilities. Coordination in the operation of the marketing system is necessary to improve performance.