ANALYZING HONEY MARKETING CHAIN IN GOMMAWOREDA,

OF JIMMA ZONE

Senior Proposal

SUBMITTED TO JIMMA UNIVERSITY COLLEGE OF AGRICULTURE

AND VETERINARY MEDICINE

BY

Department: - Agricultural Economics and Rural development

Program: -Agribusiness and Value Chain Management

Advisor: - (M. Sc.)

March, 2016
Jimma, Ethiopia
ACKNOWLEDGEMENTS

Table of content

LIST OF TABLE
ABSTRACT
This study will be conducted in Gomma Woreda of Jimma Zone; Oromia Regional state to
analyze honey marketing chain to identify the major honey marketing channel and benefit share
of actors, for key honey marketing channel in the study area and to identify factor affecting
producers honey marketing. This study will be aimed to solve the problem such us, absences of
organized market channel and formal linkages among the actors ,poor access to markets and
lower bargaining of power of smallholder farmer and seasonal fluctuation of prices in the study
area. The study has been served particularly Gomma district small holders farmers to upgrade
their income, aware honey value chain supports , government, NGOs who aim to improve the
position and income of small holders farmers and has been provided basis for researchers who
was interested to do researches in the study area. So this study will be used both qualitative and
quantitative and also primary and secondary data has been collected. The main instrument of
data collection of this study will be semi- structured questionnaires and cross sectional design
has been used to collect both primary and secondary data. Stratified sampling method for
selection of sample respondent from targeted population, simple random sampling for selection
of respondents within the strata proportionally and purposive sampling for selection of kebeles
has been used. Also the collected data has been analyzed by using descriptive statistics like
average, mean, standard deviation, percent and data has been presented using table and chart..
The major honey marketing actors revealed during survey period are honey producers, collectors,
wholesalers, retailers and consumers. Accordingly, the market channel in the survey period were
Producers –Consumers (30%), Producers – Retailers-Consumers (26.6%)and Producers-local
assembler -Wholesalers- Retailers-Consumers (43.3%). It is also found out that honey passes
through several intermediaries with little value being added before reaching the end users. The
chain is governed by local assemblers,wholesalersandretailers who have capital advantage over
the other chain actors. Therefore, farmers are forced to capture a lower share of profit margin.
Also the study revealed that the price of honey in the study area is influenced by quality of honey
,color of honey,distance from market and price of honey. The study result showed that honey
producers are faced with limited access to market, low price of product, lack of transport, low
quality of product are the major problems. Therefore, policy aiming at increasing farmers’ access
tomarketinformation, developing and improving infrastructure (like road and telephone) and
improving extension system are recommended to accelerate honey marketing development.

3
 INTRODUCTION

Background
Ethiopia has a longstanding beekeeping practices that has been an integral part of other
agricultural activities, where more than one million households keep honeybees (Kassaye,
1990; Adgaba, 2007). Beekeeping subsector is dominantly for small-scale farmers and is
contributing significantly to the increment off-farm income and toward poverty reduction in
rural areas (MoARD, 2007). Honey is considered as cash crop and only about 10% of the
honey produced in the country is consumed by the beekeeping households (MoARD, 2003).
The remaining 90% is sold for income generation (Hartman, 2004). Beeswax was also in the
list of Ethiopian agricultural export commodities, though it was only in 2008 that the country
got the EU accreditation to export its honey to EU market (Assefa, 2011)

The beekeeping subsector is also creating job opportunities in both rural and urban areas
(Assefa, 2011). Recently, the Ethiopian government is intensively working in organizing
jobless urban and landless rural youth and women to involve in them in bee equipment
production and beekeeping activities. A significant number of people are currently engaged
in honey and beeswax collection, “tej” (honey wine) making, honey and beeswax processing
and marketing (Mo ARD, 2007). The most honey and beeswax producing region in Ethiopia
are Oromia (About, 46% of total production), Amhara (25%), South Nations, Nationalities
and People Regional state, SNNPR (22%) and Tigray (5%).

Ethiopia, having the highest number of bee colonies and surplus honey sources of flora, is the
leading producer of honey and beeswax in Africa. And it is Africa‘s largest producer and
ranks 9th in the world with a current national estimated honey production of 54,000 MT per
year. About 5% of honey produced is consumed at home by rural households, 80% goes to
the tej sector and 15% is marketed (ethioagp.org/honey-2/, dec 2016).Currently, more than
7000 species of flowering plants are estimated to be found in the country, of which most of
them are honeybee plants (GirmaDeffar, 1998).

4
However, the products obtained from this sub sector are still low as compared to the potential
of the country. Although thousands of tones of honey are produced every year it is usually
poorly managed and unattractive in appearance. Because of this its place in the local market
being taken by imported honey. Moreover, traditional hive honey is of good quality as long
as it is in the hive. Faulty handling, from the time of its harvest until it reaches to market is
responsible for its inferior quality. The type of hives used the methods of removing and
storage of honey play a vital role in the quality of honey (Crane, 2007). Despite of its
potential, income obtained from beekeeping sector has been low as small scale farmers often
lack access to improve hive and local markets.

Though Ethiopia has diverse and unique flowering plants suitable for beekeeping, the bees
and the plants like all renewable natural resources are constantly under threat from lack of
knowledge and appreciation of these endowments. The principal resource base for
beekeeping has become seriously devastated in the course of time. The potential of the
Ethiopian landscape for honey production does now, undoubtedly, only constitute a small
fraction of its former wealth. Moreover, the destruction of the remaining resource-base can
be observed as, going on at a steadily accelerating pace (Girma, 1998).The major constraints
that affect apiculture in Ethiopia are lack of beekeeping knowledge, shortage of trained
manpower, shortage of beekeeping equipment, pests and predators, fires, pesticide threat and
inadequate research works to support development programs. The cultural beehives are not
comfortable for sanitation and high level of production. Farmers are only selling honey and
do not consider wax as means of income in their business
Jimma Zone has considerable potential in beekeeping with rich flora, good ecological
conditions, existence large colonies population and beehive. Based on these facts Gomma
District is believed to have diversified types of vegetation and cultivated crops and expected
to be potential for beekeeping activities so far there is no compiled and reliable information
on marketing system in the area. The entire honey production in the District is mainly for
marketing and about 80-90% of the honey produced is sold by rich, middle income and poor
households (IPMS, 2005). Despite the high honey production in the study area, there is no
ready market attracting beekeepers. Therefore, this study will be conducted to collect
information on potential opportunities and constraints because of this review will help for

5
generating improvement on the production and marketing situation of the honey in Gomma
districts.

Statement of the problem

Honey is one of the immediate sources of cash incomes to the smallholder farmers so as to
sustain their livelihood honey production is also considered a natural resource-conserving
and environmentally friendly activity (Gidey & Mekonen, 2010). Honey production in
Ethiopia has recently attracted the attention of various agencies because of its potential to
help revitalize the Ethiopian economy, reduce poverty, and conserve forests (FAOSTAT,
2012). However, there are long market channel the bee keeper’s supply honey directly to the
open market for sale to different actors like retailers, collectors and Tej brewers etc.
However, because of different problems they are not benefitted from the existing honey
supply in the extent that should be (ORDA, 4 2010). Generally, in the woreda there are
different honey market constraints .Thus to solve the problem of honey marketing, bee
keepers needs intervention which improves possibilities for the success full collective
marketing of their product. In Gomma distrct, absence of well organize market channel and
formal linkage among the actors is the major obstacle in marketing of honey. Also, there are
poor accesses to local market and lower bargaining power of small holder farmers in the
market. Seasonal production of honey resulted in price fluctuation which is also other
problems in honey marketing of the study area. All these problems often resulted in low farm
gate price and which limit producers’ bargaining power in honey marketing.
Though Gomma district is one of the potential honey producers, honey market channel and
characteristic have not been studied and analyzed. Therefore, this study will be aimed at
assessing honey marketing channel, the benefit share of market actors’ economic
performance and factor affecting honey marketing in study area. This will narrow the
information gaps on the subject and will contributes to understanding on improved strategies
for reorienting marketing systems for the benefit of small farmer and traders.

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1.3 Objective of study

1.3.1 General objective

To analyze the honey market chain in Gomma district.
1.3.2 Specific objective
To identify the major honey marketing channel in the study area
To determine the benefit share of honey marketing actors
To identify opportunity and constraint of honey marketing

1.4. Research question

This study attempt to answer the following research questions

1. What are the major honey marketing channels in honey marketing?

2. Who gets the major benefit share of marketing margins in honey marketing channel at study
area?

3. What are the opportunity and constraint of honey marketing?

1.5. Significance of the study

The output of this study will be give some insights to Gomma district small households, NGOs,
government’s organizations and other honey value chain supporters who aim to improve the
position and income of small householders in particularly and chain actors in general. Also it will
be inform the market problem of honey within area to government sectors, NGOs, and other
concerned bodies to come up with ultimate solution for the problem. And also it will be used to
design strategies based on the identified gaps to improve small householders’ incomes.
Moreover, the data will be used as secondary data for researchers and any interested parties
working in the study area.

1.6. Scope of the study

The study will be geographically limited only on Gomma district in terms of coverage’s. Also
the study will be focused on the honey marketing channels and benefit share of actors, economic
performance of honey and opportunity and constraints of honey marketing of the study area.

1.7. Limitation of the study

Different factors or constraints will appear at the time study will be conducted. The major one
will be irrelevant and no well documented data as well as reference material. Also there will be
time and financial limitation during the study. However even if all this problems has been existed
the researcher will be tried his best to prepare good research that represent the real situation.

7
LITERATURE REVIEW

2.1. Theories and Basic Concepts

2.1.1. Marketing and marketing concepts

Market: the main concept of market incorporates the present and future buyers and sellers.

In other ways market is a process in which goods and services are transferred from sellers to

Buyers which includes places, transactions, buyers and sellers (Kotler and Armstrong cited

ByAyalew, 2009).

Marketing: is the actual performance of a business accompanied by the flow of service and
goods from producers to the final consumer (Bain and Howells cited by Mohamed,2009)
Marketing is performs that seeks to accomplish organization objectives by anticipating
customers or clients need and directing a flow need –satisfying goods/ services from

Producers to customers or clients (H.B.R.C, 2007).The concept of exchange and relationships

lead to the concept of market. It is the set of the actual and potential buyers of a product (Kotler
and Armstong, 2003). A market can be described as simple arrangements to facilitate exchange
of one thing for another processes and it is more than a physical place. No need to meet
physically for a market to operate especially in today’s information and communication
technologies.

2.1.2 Agricultural marketing:

Agricultural marketing is the process of acting all business activities which incorporates the flow
of agricultural products and service from initial production until it reaches to its ultimate
consumer (kohl and Uhl cited by Simon 2009).

Marketing involves all activities involved in the production, flow of goods and services from
point of production to consumers. Marketing includes all activities of exchange conducted by
producers and middlemen in exchange for the purpose of satisfying consumer demand. It is
defined as the set of human activities directed at facilitating and consummating exchange. All
business activities facilitating the exchange are included in marketing (Kotler, 2003).

2.1.3. Marketing system

The concept of marketing system incorporates the physical distribution of inputs and out puts as
well as following production and distribution (Branson and Norvel cited byAyalew, 2009).
Marketing system includes channels intermediaries and business activities which in the process
of physical exchange of goods. The system incorporates stable and inter related structures like
production. Distribution and consumption under pin the economic process (Islam et al cited by
Ayalew, 2009).

8
2.1.4. Marketing efficiency
It refers to the efficient allocation of resources to achieve the greatest possible consumer
satisfaction (Raymon, 2003).

Marketing efficiency is also the most commonly use measure of market performance itis a
common means to achieve a goal of farmers marketing organizations, consumer’s and society.
Higher efficiency means better performance. While lower efficiency indicates poor performance
(Ibid).
2.1.4.1Operational efficiency: It is defined as the provision of goods and services at least
cost and at a level of output, or combination of inputs, which ensures that, the value of marginal
product equals marginal factor costs. Sometimes it is also referred to as firm level allocative
efficiency. The fundamental question is assessing the static operational efficiency of market and
of marketing firms, are whether, the level of output per combinations of inputs are such that
marginal revenues equate with marginal costs (Scarborough and Kydd, 1992).

2.1.4.2 Pricing efficiency: It is concerned with accuracy, precision, and speed with which
prices reflect consumers’ demands and are passed back through the market channels to
producers. Pricing efficiency is, thus, affected by rigidity of marketing costs and the nature and
degree of competition in the industry. Activities that may improve pricing efficiency are
improvement of market news and information, and competition (Cramer and Jensen, 1982). If
markets are perfectly competitive, and prices reflect real costs of production, it can be shown that
markets will lead to an optimal allocation of resources reflecting the scarcity of resources relative
to consumer demand (Scarborough and Kydd, 1992). The objective of pricing efficiency is thus
to improve the operation of buying, selling, and pricing aspect of the marketing process so that it
remains responsive to consumer's preference (Kohls and Uhl, 1985). Pricing inefficiencies arise
when markets contain monopoly elements, governments intervene by introducing restrictions on
trade, and the cost of information is zero, and so on.

2.1.5 Marketing function in an organization

Principles of marketing Wiki University stated that the process of marketing includes assessing,
analyzing and identifying market opportunities, chasing intended markets, drafting market
strategies, planning, organizing, implementing and controlling the market objectives. In this case,
marketing never stand too done in any firm (prof. Gurney cited, by Berhane, 2012).Distinguished
marketing as an important duties management that needs planning and action in order to identify.
Satisfy and regain customers as a long term career which involves adaption of its philosophies by
everybody in the whole firms. The bottle necks of marketing is to achieve the final output of all
firms resource that is good/service each and every practical areas of a given commercial
organization should activate in line with the achievement of marketing objectives and endeavors
(Homberg, etal.cited by Berhane, 2012) The production of product, financial, selling marketing
orientation should be given the attention in marketing philosophy (Rober cited by Berhane,
2012).

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2.1.6 Marketing channel
Market channel is a business structure of dependent firms which shows the flow of commodities
from its production place to the consumer with the aim of moving products to their last
consumption destination. This process can be short or long which depends up on the kind and
quality of product marketed (Gray, 2004).

There are two marketing channels through which farmers dispose their product. They are
independent and in union (Barker, cited by Tewelde 2010). It is a business structure of
interdependent organizations from the point of product origin to the consumer with the purpose
of moving products to their final consumption destination (Kotler and Armstong, 2003).

2.1.7. Market chain analysis

A marketing chain is used to describe the numerous links that connect all actors and transactions
involved in the movement of agricultural products from the farm to the consumer (Lunndy et al.,
2004). It is the path one good follow from their source of original production to ultimate
destination for final use. Functions conducted in a marketing chain have three things in common;
they use up scarce resources, they can be performed better through specialization, and they can
be shifted among channel members (FAO, 2005). According to Hobbs et al. (2000), the term
supply chain refers to the entire vertical chain of activities: from production on the farm, through
processing, distribution, and retailing to the consumer. In other words, it is the entire spectrum,
from gate to plate, regardless of how it is organized or how it functions. Market chain is the term
used to describe the various links that connect all the actors and transactions involved in the
movement of agricultural goods from the producer to the consumer (CIAT, 2004). Commodity
chain is the chain that connects smallholder farmers to technologies that they need on one side of
the chain and to the product markets of the commodity on the other side (Mazula, 2006). Market
chain analysis, therefore, identifies and describes all points in the chain (producers, traders,
transporters, processors, consumers), prices in and out at each point, functions performed at each
point/ who does what?, market demand/ rising, constant, declining, approximate total demand in
the channel, market constraints and opportunities for the products

2.1.7.1 Performance of the market

According to Abbott and Makeham (1981), market performance is how successfully the firm’s
aims are accomplished, which shows the assessment of how well the process of marketing is
carried out. Market performance can be evaluated by analyzing the costs and margins of
marketing agents in different channels. A commonly used measure of system performance is the
marketing margin or price spread. Margin or spread can be a useful descriptive statistics if it
used to show how the consumer’s food price is divided among participants at different levels of
marketing system (Getachew, 2002).

2.1.7.2 Marketing costs

It refers to those costs which are incurred to perform various marketing activities in the
transportation of goods from producer to consumers. Marketing costs includes handling cost

10
(packing and unpacking), costs of searching for a partner with whom to exchange, screening
potential trading partners to ascertain their trustworthiness, bargaining with potential trading
partners (officials) to reach an agreement, transferring the product, monitoring the agreement to
see that its conditions are fulfilled, and enforcing the exchange agreement (Holloway and Ehui,
2002).

2.1.7.3. Marketing margin

It is a commonly used measure of the performance of a marketing system (Abbott and Makeham,
1981). It is defined as the difference between the price the consumer pays and the price that is
obtained by producers, or as the price of a collection of marketing services, which is the outcome
of the demand for and supply of such services (Cramers and Jensen, 1982 and William and
Robinson, 1990; Holt, 1993). The size of market margins is largely dependent upon a
combination of the quality and quantity of marketing services provided the cost of providing
such services, and the efficiency with which they are undertaken and priced. For instance, a big
margin may result in little or no profit or even a loss for the seller involved depending upon the
marketing costs as well as on the selling and buying prices (Mendoza, 1995)
In marketing chain with only one trader between producer and consumer, the net marketing
Margin (NMM) is the percentage over the final price earned by the intermediaries as his/her
Net income once his marketing costs are deducted.

NMM =𝑀𝑎𝑟𝑘𝑒𝑡𝑚𝑎𝑟𝑔𝑖𝑛−𝑚𝑎𝑟𝑘𝑒𝑡𝑖𝑛𝑔𝑐𝑜𝑠𝑡
× 100.
𝑃𝑟𝑖𝑐𝑒𝑏𝑦𝑝𝑟𝑜𝑑𝑢𝑐𝑒𝑟
Another parameter related to marketing margin is the producer’s share. The producer’s share
is the ratio of producer price (ex-vessel) to consumer price (retail) (Mudiantono, 1990). The
Producer’s share can be expressed as
𝑃𝑥 𝑀𝑀
PS= =1- 𝑃𝑅
𝑃𝑟
Where: PS =the producer’s share
PX = producer price of honey
Pr = Consumer price of honey
MM = Marketing margin
The above equation tells us that a higher marketing margin diminishes the producer’s share and
vice-versa. It also provides an indication of welfare distribution among production and marketing
agents. The magnitude of marketing cost depends on factors such as time and place of marketing,
market conditions, and the market channel involved. The marketing will be composed with
marketing service cost and the result will be interpreted. Margins at each stage will be computed
and the share will be compared

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2.2. Empirical Review

2.2.1. Honey marketing

In Ethiopian, only about 10% of the honey produced in the country is consumed by the
beekeeping households (MoARD, 2003). The remaining 90% is sold for income generation and
of this amount, it is estimated that 80% is used for tej brewing (Hartman, 2004). According to
(Assefa, 2011), domestic honey consumption is increasing due to highly increasing demand for
tej, increased consumption of processed table honey in most urban areas and increased demand
for honey in the local industries. The domestic honey market starts at the smallholder beekeepers
level, who majorly sell crude honey to collectors in the nearest town/village markets (Abebe,
2009; Belie, 2009). Therefore, the producers are price takers. The collectors mainly pass the
honey to the whole sellers in big cities and towns, though significant amount of honey they
collect also goes to local tej brewers, processors and other consumers (Abele, 2009; Belie, 2009;
Assefa, 2011).

The whole sellers are largely situated in cities and big towns and they distribute the honey they
get from collectors to retailers, tej brewers, processors and consumers. In some areas, beekeepers
form producing and marketing cooperatives to cope with the market challenge they face. The
cooperatives collect crude honey from their members and sell the semi-processed honey to
processing companies and other intermediaries who buy in bulk and retail. However, in many
cases the cooperatives lack proper collection, storage and transportation facilities and hence
compromise the quality of the honey. They also have low business concept (market information
gathering and analysis, promotion, client handling, etc) to be competitive (Belie 2009).

The whole domestic honey market lacks proper structure and legality. It is of lengthy chain of
actors that widens the access of producers to bigger and better paying markets. So, the
beekeepers complain the business as not rewarding and even lacking market for their product,
while the consumers see the ever increasing price of honey as unfair. Moreover, the market faces
challenges like smuggling that pushes the legal actors out of market. In many cases, adulteration
of honey has been a frustrating factor for both the producers and legal buyers and sellers as the
traceability and accountability is far from practicability. It is not only the local honey market but
also the export is increasing. The total volume of exported honey between 2000 and 2008 has
been increasing recently; 1.5 tons in 2000, 275 tons in 2010 and more than 730 tons in 2012
(Assefa, 2011; EEPA 2010, 2012). And the export trade of Ethiopian honey has reached more
than 2.43 million USD (EEPA, 2012).

The involvement of honey and beeswax processing companies is also an important factor for the
increased export volume. The major importers of Ethiopian honey include Sudan, Norway, UK,
Saudi Arabia, and Kuwait, Yemen and other European countries and USA (EEPA, 2010, 2012).
The honey price at the domestic market is mostly higher than the international honey price which
makes honey export less profitable in Ethiopia (Assefa, 2011)

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2.2.2. Honey marketing channel
Beekeepers, honey and beeswax collectors, retailers, tej brewers, processors and exporters are
identified to be the key actors in the value chain of the honey sub-sector. Three principal
channels were identified in the value chain of the sub-sector. These are tej brewery channel,
honey processing and exporting channel and beeswax channel. These channels are complex and
interconnected that implies absence of organized marketing channel and lack of formal linkages
among the actors. Most of the harvested honey goes through tej brewery channel. Beekeepers
directly sell their honey to local honey collectors (dealer or cooperatives) at district or zonal
levels, which directly deliver the honey to tej brewery houses in their localities and/or transport it
to the big honey dealers (verandah) for breweries in Addis Ababa. Some beekeepers who are
producing large quantities of honey also directly supply it to tej houses in their areas. Although
economically not so significant, tej is informally exported through country visitors and transitory
(Beyene and David 2007).

Honey processors’ and exporters’ channels also start from beekeepers and goes through the local
agents of honey processors and/or honey marketing cooperatives, which supply the honey
directly to the processing plants either with partial refining or as it is. The processing plants
further refine the honey using advanced processing devices and pack into labeled containers for
local markets (super markets, food groceries and big hotels) and very often to export markets.
(Beyene and David, 2007).

Unlike the two channels mentioned above, the beeswax channel starts mainly from tej brewery,
which collects the wax as a by-product of tej or berz. The tej brewers either sell the crude
beeswax or semi-processed to the local beeswax collectors who supply to beeswax refiners in
Addis Ababa. The beeswax processors produce the final pure beeswax suitable for export market
and local markets. Sometimes beekeepers buy beeswax from the wax collectors and/or
processors to use as a starting input for honey production using intermediate and modern
beehives (Beyene and David 2007). Beekeepers sell the largest proportion of their honey during
harvest at low price mainly to meet their demand for cash to pay taxes, debts and other social
obligation (Beyene and David, 2007).

2.2.3. Challenge and opportunities in honey marketing

2.2.3.1.challenges: Low quality and limited supply of honey are the most critical problems in
the value chain, which is mainly caused by limited availability of bee forage (due to
deforestation), shortage of honeybee colonies, backward technology, poor pre and post-harvest
management. Inadequate government support also resulted in poor extension services, lack of
improved technologies, shortage of trained human power, and lack of access to credit services
and weak road and market infrastructures in production areas. The present increasing use of
pesticides and herbicides is severely threatening bee colonies implying conflicts of crop and
honey production. Absence of organized market channel, lack of market information and poor

13
access to international markets are also the other critical challenges facing the sub sector.
(Beyene and David, 2007).

2.2.3.2. Opportunities: There is still huge potential to increase honey production and to
improve the livelihood of the beekeepers (farmers). Besides the existing natural base,
government has recently put in its agenda the need to develop apiculture as one of the strategies
to reduce poverty and to diversify national exports. Many NGOs are also giving more attention
to the sub-sector than ever before as an important intervention areas to support the poor and
particularly the women. This will give farmers the opportunity to access improved technologies
and capacity building (training on apiculture). Moreover, honey and wax processors and
exporters have formed associations, and beekeepers started to establish cooperatives/unions.
These institutional changes will provide good opportunity to create increasing demand and
competitive market for organic honey. In addition, organic and Fair-trade honeys are, presently,
fast growing market niches in the major honey-consuming countries in Europe, which is creates
a special benefits for organic honey producing countries like Ethiopia. (Beyene and David,
2007).

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METHODOLOGY

3.1. Description of the study area

The study will be conducted in Gomma Woreda of Jimma Zone; Oromia Regional state.Gomma
is bordered on the south by Seka Chechorsa, on the southwest by Gera, on the northwest by
Setema, on the north by the Didessa River which separetes it from the Illubabor zone, on the
northeast by Limmu Kosa, and on the east by Mana This study will be focused on analyzing
honey marketing chain in Gomma Woreda. Gomma woreda is one of the 17woredas in Jimma
zone known for predominantly growing honey production. It is located 390 km south west of
Addis Ababa and about 50 km west of the Jimma Zone capital (Jimma). One of the honey
biodiversity centers in Ethiopia is found in this woreda. There are 36 peasant associations and 3
towns’ associations. The number of agricultural households in the woreda is 45,567 (35,533 male
headed and 10,034 female headed), while the total population of the wereda was 247,326 (CSA,
2007/2008). Hence the total area of the woreda is 96,361.72 ha (96.4km2).

Demography: The total population of the Woreda was 216,662 from which 110,448 are males
and 106,174 females (CSA, 2009).The number of agricultural households in the Woreda was
45,567 (35,533 male headed (78%)) and 10,034 female headed (22%)).

Topography: The topography, vegetation, and rainfall pattern in the wereda encourages the
existence of many perennial rivers. The rivers drain to Ghibe/Omoto the east and Dedesa River
in the north. There are about 5 rivers in the woreda. Even though available land and water
resources offer high potential for irrigation development insult of low pH is minimal (ORS, 201

Climate

Unlike other areas in Ethiopia, the south and southwestern regions of the country receive reliable
rainfall. Gomma woreda is one of these regions that enjoy well distributed annual rainfall. Based
on 15 years weather data obtained from Gomma wereda, it indicates that the average annual
rainfall is 1524 mm. The annual rainfall variability is very low. Rainfall is bimodality
distributed. The small rains are from March to April and the main rainy season from June to
October. All in all, there are about 7 rainfall months in the wereda. However, rainfall is
sometimes received even during the other months. Hence, crop and livestock production is not

15
constrained by the amount and distribution of rainfall as in other parts of the country. Seasonal
and area wise variability of rainfall is low and hence one can make plans of crop/livestock
production based on the existing rainfall amount and pattern. The rainfall pattern of Gomma
wereda is shown on. Dry spell months in the wereda are few. Agro ecologically, Gommawereda
is classified as 96% wet Weina Dega (wet midland) and 4% kolla (lowland). Altitude in Gomma
ranges from 1387 to 2870 meters above sea level (m a.s.l). Most parts of the wereda lie between
1387 and 1643; and 1849 and 2067 m a.s.l. However, few of the areas in the wereda have
altitudes ranging from 2229 to 2870 m a.s.l. These characteristics of altitudinal difference are
observable as one drives from Jimma to Agaro (ORS, 2011).

3.2 Research Design

The research will be conducted to analyze honey marketing chain in Jimma zone, Gomma
district. The study will be contacted trough sampling technique selecting from the total
population. Both quantitative and qualitative data will be collected from primary and secondary
sources.

3.3. Sample Size and Sampling Technique

For this study stratified sampling method will be used in order to select respondents from the
total target population. The reason for using this sampling method is that there are different
actors in market channel in the study area. A simple random sampling method will be also used
to select respondents within the same strata proportionally because respondent in the strata are
homogenous. To conduct this study, we will be used random sampling technique of selecting 50
persons in two Kebele, because this technique permits complete freedom in choosing sample
according to researchers wishes and desires. The aim is to select elements that are believed to be
representatives of the whole population and who can provide appropriate information based on
the way they requested. Appropriate sample size depends on various factors relating to the
subject under investigation including time, cost and degree of accuracy. In the first stage, Jimma
zone will be selected purposively then Gomma also selected purposively and two kebele
administrations namely Bulbulo and Choche are selected by using lottery method since it is near to
our campus. Finally, as those areas is considered as basic sampling unit, 50 household will be
selected using probability proportional to sample size (PPS) -sampling techniques. This is as
follow: From total population 94 household will be selected by using Slovene’s formula. From
these 44 beekeeper/ producers, 20traders and 30 consumers will be selected for interview

16
schedule. From this target population 50 sample sizes of respondents will be taken. Based on the
numbers of population in each stratum 24 respondents from beekeepers, 12 respondent from
traders and 14 from consumers will be taken proportionally.

To determine the sample size for a population, we use Slovene’s formula

n=N/ (1+ (N*e2)
Where:
n=number of samples

N=total population
e = 10% = 0.1 margin of error

n=N/ (1+N (e2)

n= 1529/1+ (1529 *0.12) =94

Table1. Total Household and Sample Size

Kebele Household Male headed Female headed Sample

Bulbulo 704 611 93 43HH

Choche 825 649 176 51HH

Total 1529 1260 269 94HH

Source: Bulbulo and Choche kebele office, 2007

The sample size of the two Kebeles is 94HH; we reduced the sample size to 50HHdue to time, budget
constraints and the entire community consideration of the activity of study as steering for election. That
means we select 23HH from Bulbulo kebele and 27HH from choche Kebele using Proportionate to
population size (PPS). We take the sample size for Bulbulo and Choche Kebele by using lottery method.

Thus, sample size of respondents from both kebeles can be calculated as follows:

Sample size from Bulbulo kebele 704*50 = 23

1529

Sample size from Choche kebele 825*50 = 27

1529

So, total sample size from both Kebeles is 23+27=50

17
 Oromia Purposive

Jimma Zone Purposive

Gomma Woreda Purposive

Bulbulo=23 Choche=27 Lottery

Method

50 HH PPS

18
3.3.1. Beekeeper (producers) Sampling

Producer sampling will be taken from the two sampled kebeles and from the population of the
town of the based on honey producers in study district. The honey producers from in
Gomma,Bulbulo, and Choche will be selected. The sample size of honey producers is 24
households will be selected

Table 1. Sample distribution of honey marketing producers

Place Gomma Town Bulbulo Choche Total

Producers - 12 12 24

3.3.2. Trader Sampling

The sites for the trader’s survey will be market place, which will be selected based on the flow of the
honey produce in the study district. Three market place (Gomma town, Bulbulo and Choche) will be
sampled. The sample size of honey traders is 12, hence, the number of permanent honey traders in the
main honey marketing channel in the study area will be very limited, and almost all of them will be
included in the traders ‘survey.

Table 2. Sample distribution of honey marketing traders’

Market center Gomma Town Bulbulo Choche Total

Traders Retailers 1 1 1 3
Processors 1 1 1 3
Rural collectors 3 3 6

19
3.3.3. Consumer Sampling

Consumer sampling will be taken from the two sampled kebeles and from the population of the
town of the district based on Slovene’s formula and population proportionality with the main
purpose of the flow honey produced in two study Kebeles to the market.

Table 3.Sample distribution of honey marketing consumers

Place Gomma Town Bulbulo Choche Total

Consumers 8 3 3 14

Figure 2: Sampling Technique and sample size

3. 4.1. Type of Data

In this study both quantitative data such as inputs ,production, income ,factors of production and
qualitative data like marital status, educational level and others were included .

3.4.2. Sources of Data

Primary data will be one source of the study which will be collected directly from the sample
respondent of the total population. The respondents include actors such as producer, traders and
consumers involved in Analyzing honey marketing chain, so different distributing
questionnaires, observations, and interviewing will be prepared for each actor to collect primary
data from each participant at different level. Source of secondary data include published and
unpublished documents, Kebele official reports, maps, administration and agricultural office,
related documents, internet, journals, magazine, and bulletin in the different governmental and
non-governmental offices found in the Kebele and Woreda offices.

20
3.5 .Data collection methods
The main instrument of data collection of this study will be semi-structured questionnaires. This
type of questionnaires enables the researcher to clarify information from respondents and to ask
supportive questions in order to gain relevant and understandable information. The prepared
questionnaires will be distributed proportionally to sample strata. Interview (both personal and
telephone) and non-structured observations will be another and the most important method to
collect data during the study.

3.6 .Method of data analysis

The data that will be collected from respondents will be analyzed by using various methods.
Qualitative data will be analyzed by using interpretation and description. Quantitative data will
be analyzed by using descriptive statistics such as percentage, mean and standard deviation. Also
the data will be presented using tables and charts, because it is easy and convenient to handle and
present data. The interval and ratio scale of measure will be used during the study.

21
4 .WORK PLAN AND BAUDGET

No Activity Duration
1 informal survey March 2017
2 Questionnaire development March 2017
3 Formal survey March 2017
4 Data summarization April 2017

5 Data coding and entering April 2017

6 Data analysis May 2017

7 Writing the first draft report May 2017
8 Revising the draft report May 2017
9 Writing the final report June 2017
10 Presenting the report June 2017

22
5. Budget

1 Statuary Quantity Unit price Total cost Remark

(birr)
1.1 Pencil 5 1 5 5*1=5
1.2 Pen 6 5 30 6*5=30
1.3 Writing pad 1 15 15 1*15=15
1.4 Staples 2 30 60 2*30=60
1.5 Printing paper 1 pad 110 110 1*110=110
1.6 Photocopy 1 pad 110 110 1*110=110
paper
1.7 Printing Printing 120. 120 1*120=120
2 Transportation 10 days 20 200 10*20=200
3 Researchers 1 researcher 60 60 1*60=60
4 Data collector 3 laborer 20.00 60.00 3*20=60
Grand 770
(total)

23
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Wing Tai Cheung Printing Co. Ltd, Rome. 58pp

Abebe A, 2009. Market chain analysis of honey production: in AtsbiWemberta District,

Eastern Zone of Tigray National Regional State. A Thesis Submitted to College of Agriculture
Department of Agricultural Economics, School of Graduate Studies. Haramaya University,
Haramaya

Adgaba N, 2007. Atlas of pollen grains of major honeybee flora of Ethiopia. Holeta Bee
Research Centre. Commercial Printing Enterprise. Addis Ababa, Ethiopia. Pp 152.

AndargachewKebede, 1990. Sheep Marketing in the Central Highlands of Ethiopia. An MSc

Thesis Presented to the School of Graduate Studies of Haramaya University. Ethiopia. 117p.

Assefa M, 2011. Pro-poor value chains to make market more inclusive for the rural poor:
Lessons from the Ethiopian honey value chain. Danish Institute for International Studies,
Copenhagen, Denmark.Pp. 35– 50.

Assefa M, 2011. Pro-poor value chains to make market more inclusive for the rural poor:
Lessons from the Ethiopian honey value chain. Danish Institute for International Studies,
Copenhagen, Denmark.Pp. 35– 50.

Backman, T. N. and W. R. Davidson, 1962.Marketing Principle. The Ronal Presses Co., New
York. pp. 3-24.

Banson, R. E. and N. Norvell, 1983.Introduction of Agricultural Marketing, McGraw Hill Book

Company, New York. 365p.

Belie T, 2009. Honeybee production and marketing systems, constraints and opportunities in
Burie District of Amhara Region, Ethiopia. A Thesis Submitted to the Department of Animal
Science and Technology, School of Graduate Studies. Bahir Dar University, Bahir Da

Beyene, T and David P, 2007. Paper prepared for International Development Enterprises (IDE)
and Ethiopian Society for Appropriate Technology (ESAT)

CIAT (Centro International de Agricultureal Tropical), 2004.Increasing the Competitiveness of

Market Chains of Smallholder’s Producers. Manual, 3: Territorial Approach to Rural Agro
Enterprise Development Project. Bain, K. and P. Howells, 1988. Understanding Markets: An
Introduction and Practice of Marketing. Harvester Wheat sheaf, London

Cramer, D. and D. Howitt, 2004. The Sage Dictionary of Statistics, a Practical Resource for
Students in the Social Sciences, SAGE Publications, New Delhi

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CSA (Central Statistical Authority), 2009.Area and Production of Major Crops. Sample
Enumeration Survey. Addis Ababa, Ethiopia

Edessa Negera, 2005. Survey of honey production system in West Shewa Zone: Proceedings of
the 4th Ethiopian Beekeepers Association (EBA).

EEPA, 2010.Ethiopian export data.Ethiopian Export Promotion Agency. Addis Ababa,

Ethiopia.EEPA, 2012.Ethiopian export data.Ethiopian Export Promotion Agency. Addis Ababa,

Ethiopia.

GetachewBeshargo, 2002. Cattle Marketing in Western Shewa.M.Sc Thesis Presented to the

School of Graduate Studies of Alemaya University, Ethiopia FAO (Food and Agricultural
Organization), 2005a. Addressing Marketing and Processing Constraints that Inhibit Agric-food
exports: A guide for Policy Analysts and Planners.

GirmaDeffar, 1998. Non-Wood Forest Products in Ethiopia. EC-FAO Partnership Programme

(1998-2000). Addis Ababa. pp. 1-5.

Hartmann I ,2004. The management of resources and marginalization in beekeeping Societies of

Southwest Ethiopia. Paper submitted to the conference: Bridge Scales and Epistemologies.

Holloway, G. and S. Ehui, 2002.Expanding Market Participation among Smallholder Livestock

Producers: A Collection of Studies Employing Gibbs Sampling and Data from the Ethiopian
highlands.Socio-economic and Policy Research Working Paper 48.ILRI, Nairobi, Kenya. 85p

IPMS (Improving Productivity and Marketing Success), 2005.south west shewa zonal Pilot
Learning Site Diagnosis and Program Desing

Jesse, V.E., 1987. Economic Efficiency and Marketing Order. Economic Efficiency in
Agricultural and Food Marketing: pp. 217-228

Kohls, R, L. and J.N. Uhl, 1985.Marketing of Agricultural Product.FifthEdition.McMillan

Publishing Company, NewYork, USA 624p.

Kolter, P. G., Armstrong, 2003. Principle of Marketing. 10th Edition, Hall of India Pvt. Ltd.,
New Delhi. 5-12p.

Lusby, F., 2007. Value Chain Program Design: Promoting Market Based Solutions And
Competitiveness. http://www.actionforenterprise.org/paper07.pdf Accessed on 05thDecember,
2009

Mazula, R., 2006. Commodity Chain Approach and Deal Structuring: An Agri- Business
CaseStudy in Zimbabwe Progress Fund. PP.73-78., Zimbabwe. [Online] Available from:
http://www.zoic.co.zw/documents.pdf. [Accessed on 10 Sptember 2008].

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Mendoza, G., 1995. A Primer on Marketing Channels and Margins.LymeRimerPublishersInc.,
USA. 425p.

William, G. T. and K. L. Robinson, 1990.Agricultural Product Prices.Cornell University Press,

3rd edition, Ithaca and London.MoARD 2007: Livestock Development Master Plan Study. Phase
I Report - Data Collection and Analysis, Volume N - Apiculture. Addis Ababa, Ethiopia,
Ministry of Agriculture and Rural Development.

Ro Hobbs, J.E., A. Cooney and M. Fulton, 2000. Value Chains in the Agric-food Sector: What
Are They? How Do They Work? Are They for Me? Department of Agricultural Economics,
University of Saskatchewan. Canada. 31pme. Italy

26
7. APPENDIX
QUESTIONNAIRE FORMAT ON HONEY MARKETING CHAIN

Objective of study

To identify the major honey marketing channel in the study area

To determine the benefit share of honey marketing actors

To identify opportunity and constraint of honey marketing

Section1: Questioner Prepared For Producer

I. Demographics

1. Name of household head______________________ Sex ______ Age ___________ years.

2. Marital status of household head ________. 1. Single 2. Married 3.Divorced 4.Widows

3. Religion of the household __________. 1. Orthodox 2. Protestant 3. Catholic 4. Muslim

4. Total number of family members’ ______.

1. Blow 15 years ______ 3. 30-50 years ____________

2. 19-64 years _________ 4. Above 64 years ________

5. Education level of household head _

1. Illiterate 3. Primary school (1-6)________ 5. Certificate and above ____

2. Read and write 4. Secondary school (7-12) _______

II. Area Information

6. Woreda ----------------------- Name of Rural Peasant Administration -------------------

27
7. Distance of your residence from the nearest market center_____ Km or _________________
walking time (minutes/hrs).

8. List the home use of honey.

1. As a food 2. As a medicine

3. For beverages 4. For cultural and ritual ceremonies

9. Who are your customers?

1. ‘Tej’ houses 2. Middlemen

3. Retailers 4. Wholesalers

5. Consumers 6. Beekeepers co-operative

7. Others /specify/ ______________________

10. What is the demand of honey in the market?

1. Very high 2. High 3.Medium 4.Low 5. Very low

11. List problems you have been come across to bring your product to market.

______________________________________________

12. Which channel do you prefer more to sell your produce?

a. Producer retailer consumer

b. Producers wholesalers Retailers consumer

c. producers consumers

d. Other specify………………………………..

13. If you answer the above question; what are the reasons for your channel preference?

1. Makes farmers more beneficial 2. Better price 3. Volume\quantity

4. Other specify_______________________________

III. Production

14. Trend of honey production during the past 3 years?

No Production trend
Reason

28
1. Increase
2. Decrease
3. Stable

V. Marketing Aspect

15. Amount of honey supplied to the market and market agents?

Place to sell Distance to Means of transportation To whom do you sell

market(km)
1.Farm gate 1.on donkey 1.wholesaler
2.Local market 2.vehicles 2.Retailer
3.town 3.on foot(being carried) 3.consumer
4.other(-----) 4.processors
5.Broker
6.local collector
Honey

16. What percent of the total produce is sold on local market?

17. How is the price trend of honey in your locality?

No Price trend Reasons

1. Increasing

2. Stable

3. Decreasing

18. Where is your major sell place? (More than one answer is possible)

1. In your home 2. Nearby market place

3. Major honey market place 4. Beekeepers cooperatives

5. Other (specify)________

19. How do you get market price information of honey? -------------------------------------------------

---------------------------------------------------------------------------------------------------------------------
--------

29
20 .Did you know the market prices before you sold your honey? 1=Yes 0=No

22. Did you know the nearby market price before you sold your honey? 1=Yes 0=No

23. Did you know Busa market price before you sold your honey? 1=Yes 0=No

24. Does your produce have preferred quality by buyers? 1= Yes 0=No

25. If no, what interventions are needed to attract better price? -----------------------------------------
----------------------------------------------------

26. What are the problems of marketing? (Rank horizontally)

product Lack Low Price Lack of Lack of Broker Other(specify)

oforganined price fluctuation transportation market hinder
market information
Honey
27. What determines to sell the products to your customers?

1. Price 3. Quality 4.colour of honey 5. Table honey and crude honey

2. Market force (supply and demand) 6. Others _________________30.Average return of

honey at individual producers.

product Selling Total cost(in br/kg)

price(Br/kg) Packing Communication Transport broker revenue Tax
material cost
Honey

28. How did you sale your produce? _

1. Direct to the purchaser 3. Through commission man to the purchaser

2. Through broker 4. Others (specify) -----------------

29. What was /were problem/s created by brokers on honey trade? _

1. Took to limited client 3. Charged high brokerage fee

2. Cheating on scaling (weighing) 4. Wrong price (market) information

5. Others (specifes)

30. What do you do if you didn’t get the expected price for your honey supply?

1. Took back home 3. Sold at lower price

30
2. Took to another market on the same day 4. Sold on other market day

31. Who sets your selling price for? _

1. Yourself 3. Set by demand and supply

2. Buyers 4. Negotiations 5. Others (specify) ----------------------------------------------

SECTION 2: Questioner Prepared For Traders’

I.Demographics

1. Name of household head______________________ Sex ______ Age ___________ years.

2. Marital status of trader________. 1. Single 2. Married 3.Divorced 4.Widows

3. Religion of the household __________. 1. Orthodox 2. Protestant 3.Catholic 4. Muslim

4. Total number of family members (size)’ ______.

1. Blow 15 years ______ 3. 30-50 years ____________

2.31 -51 years _________ 4. Above 51 years ________

5. Education level of household head _

1. Illiterate 3. Primary school (1-6) ______ 5. Certificate and above ____

2. Read and write 4. Secondary school (7-12) _______

II. Area information

6. Woreda -------------- Name of Market------------- 1.Village market 2.Busa market

3. Ginchi market

7. Main occupation

1. Wholesaler 4. Farmer trader (village collector)

2. Retailer 5.Urban assembler

3. Processor 6.Others (specify) --------

8. How long have you been in honey trading? ----------------- years.

9. Do you participate in honey trading year round? 1= Yes 0= No

10. If no, at what period of the year do you participate?

31
1. When purchase price becomes low

2. During high supply 3. Other (specify) -----------------

11. Who sets the price of the product? 1. Myself 2. Set by demand and supply

3. Buyers 4. Other specify_______________________________

12. Which channel do you prefer more to sell your produce?

a. Producer retailer consumer

b. Producers local assemblers wholesalers Retailers consumer

c. producers consumers

d. Other specify………………………………..

13. If you answer the above question; what are the reasons for your channel preference?

1. Makes traders more beneficial 2. Better price 3. Payment system

4. Other specify_______________________________

14. Who will buy honey from you ?

1. Wholesaler 2. Retailers

3. Household consumers 4. Broker 5. Others---------------------------------------------

------

15. From where did you purchase honey?

1. From village, name of village (specify) -------------------------------

2. From market, name of market (specify) ------------------------------

16. How did you sale your produce? 1. Direct to the purchaser 2.Throug broker

3. Other (specify) -------------

17. How did you set price? 1. Set at time of advance given 2. Negotiated at delivery 3. At time
of delivery 4. Others____________

18. Who purchase honey for you?

1. Myself 2. Broker 3 Commission agents

4. Family members 5. Friends 6. Others____

32
III. Purchase practice

19. From which market and supplier did you buy honey?

From Purchased from Quantity Average price

market(location purchased on per kg
name) market(kg)
1. 1.farmers
2. 2.retailers
3. 3.wholesaler
4.collector
5.others…………………………………

20 .From which market (s) do you prefer to buy honey most of the time? From----------------------
-------------------------------------- market.

21. Why do you prefer this market? 1. Better quality 3. High supply

2. Shortest distance 4. Others _____

22. Which are the months of the year when prices are lowest?

23. Which are the months of the year when prices are highest?

III. Purchase practice

24. From which market and supplier did you buy honey ?

From Purchased from Quantity Average price

market(location purchased on per kg
name) market(kg)
1. 1.farmers
2. 2.retailers
3. 3.wholesaler
4.collector
5.others…………………………………

25 .From which market (s) do you prefer to buy honey most of the time? From----------------------
-------------------------------------- market.

26. Why do you prefer this market? 1. Better quality 3. High supply

2. Shortest distance 4. Others _____

33
27. How did you attract your buyers?

1. By giving better price relate to others 3. By visiting them

2. By fair scaling (weighing) 4. Others (specify)

28. What is your source of information? _______________________________

29. How do you qualify the reliability, timeliness and adequacy of the information you got?
Regarding the nearby local and Busa market.

1. It was reliable 3. It was timely

2. It was adequate 4. Others (specify) ----------

30. Indicate your average cost incurred per kilogram in the trading process of honey.

Cost of marketing Br/Kg of honey

Purchasing price per kg
Labor employed and packages
Brokerage
Transportation: vehicle
Sorting
License and taxes
Manufacturing cost/processing cost
Telephone expense
Personal travel and other expense
Others(specify)
Total cost
Selling prices

SECTION 3:Questioner Prepared For consumers

I Demographic

34
1.Name --------------------------------------------Residence----------------------------------------------

2.Main work activity ------------------------------------------------------------

3.Family size 1. Female ------------------- 2. Male -----------------

4.Education level A. Read & write B, between 1-6

C, between 7-8 D, between 9-10 E, Above 10

5. How often do you eat honey?

1. During holidays [ ] 4. Once a week [ ]

2. Once a month [ ] 5. Twice a week [ ]

3. Twice a month [ ] 6. More often [ ]

6. From where do you get it? 1. -------------------------

2 ---------------------

7. Who sets the price of the product? 1. Myself 2. Set by demand and supply

3. Sellers 4.Other ----

8. What is the price of honey per/kg? 1. ---------------------------

9.What is your source of price information? _______________________________

10. What are the trends of price over the last five years? 1. Increasing 2. Decreasing

11. If Q.10 is increasing what do you think the reason for price changing?

1. Demand increase 2. Seasonal production

2. Others ------------------------------------------------------------------------------

12. At what time the price of honey rise?

I. ---------------------------------------------------------

II. --------------------------------------------------------

13. Which channel do you prefer more to buy your produce?

a. Producer retailer consumer

b. Producers local assemblerswholesalersRetailers consumer

35
c. producers consumers

d. Other specify………………………………..

14. If you answer the above question; what are the reasons for your channel preference?

1. Makes consumers more beneficial 2. Better price 3. Payment system

4. Other specify_______________________________

Thank you very much for responding to the questions.

Name of the Enumerator: ______________________ Date of Interview

36