Effects of Marketing Constraints on Gross Margin of Local Rice Retailers in Ardo-Kola L.G.A, Taraba State, Nigeria

Abstract

This study assessed the effects of marketing constraints on the gross margins of Local Rice retailers in Ardo-Kola L.G.A of Taraba State, Nigeria. Purposive and multistage random sampling methods were used to select twelve respondents each from five major markets in the study area, giving rise to 60 respondents. A structured questionnaire module was used in gathering information on retailers' socio-economic characteristics and constraints faced. Data obtained from completed questionnaire were organized and analyze using descriptive statistics such as frequency distributions, and percentages. Gross and net margin analyses were conducted to assess the profitability, while OLS regression model techniques was adopted to infer the effects of the constraints on the gross margin of the retailers. Results of the descriptive statistics reveal that women constituted 70% of the respondents. Those married constituted 55.0%, and those with primary education were 51.7% of the respondents. Saving was the main source of income and constituted 58.3% of the initial capital. An age range of 26-35 dominated rice retailers' age, with 41.7% of the respondents falling into this age group, while household size of 6-10 dominated, constituting 55% of the respondents. Also, the results of the regression analysis reveals that  retailers' constraints in terms of cost of union fee, transportation and shop rent significantly influence gross margin  at 1%, 5% and 10% levels of significance, respectively. It is recommended that since decrease in the costs of these independent variables increase gross marketing margins of the retailers, the local as well as the Federal governments and all stakeholders should rally around to reduce amounts payable as union fee, in addition to providing cheaper transportation and shop facilities to improve marketing margin and possibly increase the net income, and improve welfare of rice retailer marketers in the LGA on the long run.

Keywords: Marketing Constraints, Effects, Rice Processors, Gross Margin, Net Income

DOI: 10.7176/DCS/12-7-05

Publication date:November 30^th 2022