An appropriate conceptual supply chain management model in the Tanzanian agricultural sector : a case study of coffee in the Kagera Region

Abstract

Tanzania’s good climatic condition of four agro-ecological zones and six farming system together with adequate good soils and water resources with reasonable rainfall patterns (except in semi-arid regions) are favourable for agricultural production. Despite this abundance of resources, Tanzania is still far from taping full potentials in crop production and productivity that could be attained if the existing agricultural resources were fully utilised. The agricultural sector has failed toraise the rural poor above the poverty line and has perpetuated the existing pervasive poverty among farming communities. These constraints facing the agricultural sector have contributed to low production and productivity of the agricultural sector. For several decades the agricultural sector has failed to fulfil its role as the “engine of economic growth”; as a result, the general picture of the Tanzania’s economy has remained untransformed and unreliable. Given the importance of agriculture as the mainstay of rural livelihoods, it must grow much faster to realise rural poverty reduction in Tanzania. In view of the above state of affairs, this study posed the following research questions: Are support activities and services in coffee production, processing and marketing significantly linked to allow application of Supply Chain Management (SCM)?; Do institutions responsible for coffee provide mandatory services to enable farmers undertake support activities and services in production, processing and marketing of this crop? Finally, are the coffee marketing support activities and services significantly integrated along the supply chain in order to enhance its marketing? Thus, the above underlined challenges and questions imply thatstagnation in agricultural development is a function of a multiplicity of soci-economic, technological and political factors. As a result, the call for improving the agricultural sector production and productivity needs a holistic approach, particularly the application of SCM. The above fact suggests that Tanzania should among others, find ways to increase agricultural production, productivity, promote agro-processing and expand markets for its agriproducts through a well co-coordinated system. The present study calls for a collaborative and integrative approach in the supply chain to plan and control the flow of value adding materials from the producers to the consumers. The objective of this study is to examine the application of the Conceptual Supply Chain Management Model (SCMM) in coffee support activities and services in the areas of production, processing and marketing in order to suggest an appropriate model that can improve production and productivity of the agricultural sector thereby enhancing the income of the rural poor and ultimately alleviating poverty and raising the standard of living of Tanzanians. Following the format prescribed by the University of South Africa, this thesis is organized into eight chapters. Also, it is structured in a coherent manner to bring the logic for the development of the conceptual framework for the coffee subsector in Kagera region. Chapter One provides the introduction and background information. It creates a base and sets a framework for the entire study. Chapter Two presents the literature review including both the theory and practice of SCM. It also presents the background and SCM development as well as the importance of integrating SCM in the agricultural sector in Kagera, Tanzania and the world at large. The objective of the chapter is to present an in-depth review of literature and show the gap so as to make justification for proposing a study on the application of the SCM in agriculture with reference to Coffee in Kagera Region. Chapter Three discusses the Model Development. It discusses the meaning and the type of conceptual models. Further more, it discusses the reasons for and the advantage of applying the conceptual models. Finally, it highlights the rationale for selecting a particular criterion for evaluating the conceptual models. Chapter Four presents research methodology including identification of the definition of research and different research methods and their respective instruments for undertaking this study. It presents the theoretical and research process, showing the types of research methods and research designs. It also presents in detail, sampling, sampling techniques and data collection techniques. Finally, the chapter highlights how the collected data have been organised, analysed and presented. Chapter Five is about research findings. It covers the outcome of the exercise set by Chapter Four. It presents descriptive and empirical information of basic agricultural support activities along the supply chain from production through consumption. It involves the analysis of the production, processing and marketing support activities to examine their influence on the production and productivity of coffee in Kagera Region. Chapter Six entails synthesis analysis and results. This is an amalgamation of the research findings as well as synthesis, descriptive and empirical analysis of those findings. Thus, the chapter is about the analysis of coffee production, processing and marketing support activities and services in Kagera Region. Chapter Seven describes the contribution to knowledge which shows the existing conceptual SCMM for coffee in Kagera. The Chapter presents the appropriate conceptual model which adopts planning of many components in the coffee supply chain such as suppliers, materials, resources, warehouses, transporters and customers. The Model has been developed and proposed for application in Kagera Region in order to address the shortcomings addressed in the analysis made in the existing model as indicated in Chapter Six. Chapter Eight presents the summary, conclusions and recommendations. In this chapter, the study concludes that coffee marketing support activities and services in Kagera are not significantly linked to production and processing in order to allow the application of SCM principles. Furthermore, it shows that coffee management institutions such as private coffee traders, cooperative unions, government regional and district agricultural offices and other stakeholders do not provide all mandatory services to enable coffee production, processing and marketing support activities and services. According to this study, marketing support services are not significantly integrated in the coffee supply chain that will enhance its marketing. Given this reality, this study proposes the adoption of the appropriate conceptual SCMM. The Coffee SCMM has been developed to coordinate key players and processes in coffee SCM for the integrated framework. The proposed model has been successfully implemented in many successful management systems. The conceptual model for Kagera integrates various participants involved in the entire coffee supply chain including coffee producers, processors and exporters. The Tanzania Coffee Board (TCB) is proposed to be the overall coordinator of the entire coffee supply chain. In addition, it proposes an information exchange procedure among players (feedback) initiated by consumers. For further studies, the study recommends three major blocks of studies such as support activities and services in the areas of SCM in coffee production, processing and marketing. Finally, the study proposes these three major areas to be individually and deeply studied.