Response rate
The study issued 96 questionnaires to the respondents. The researcher retrieved all of them, but only one questionnaire was discarded due to incompleteness. This resulted in a response rate of 98.7%, which was adequate for further analysis.
Socio-demographic characteristics
The study's socio-demographic characteristics include gender, age, marital status, education level, household size, and income.
Table 1
Showing summary of socio-demographic characteristics of the respondents
Description | Frequency | Percentages |
Gender Male Female | 25 70 | 26.3% 73.7% |
Age of the respondent Above 60 years 51–60 years 41–50 years 31–40 years 20–30 years | 7 3 38 16 31 | 7.0% 3.0% 41.0% 17.1% 32.9% |
Marital status Married Single Divorced | 71 18 6 | 74.7% 18.9% 6.3% |
Education None Primary Secondary University | 32 43 18 2 | 33.70% 45.30% 18.90% 2.10% |
Household size 2–5 people 6–10 people More than 11 people | 12 72 11 | 12.6% 75.8% 11.6% |
Income level $100-$150 $150-$200 $200-$250 $250-$300 Above $300 | 30 23 25 14 4 | 32% 24% 26% 14% 4% |
Survey data, (2020) |
The study results indicate that the majority of the respondents, 73.7%, were male and 26.3% of the respondents were female. According to the Somali culture, males are the decision-makers in the household. They, therefore, control resource mobilization, mainly farming and agribusiness activities. Moreover, agricultural practices are labor-intensive and are consequently associated with males who are more muscular to implement. However, some women are also gaining interest in the farming sector, particularly agribusiness value additions and supply chain in most of the cities in Somaliland. A similar finding was obtained by Nzioki (2015) in his study: Gender Analysis of Maize Post-Harvest Management in Kenya. The study found that most of the respondents along the maize value chain were male.
The study findings show that most of the respondents, 41%, were in the age category of 41–50 years. Other respondents’ age categories were as follows: 20–30 years 32%, 31–40 years 17%, above 60 years 7%, and finally, 51–60 years 3%. Some agribusiness enterprises require colossal capital, such as greenhouse and water drilling.
The study results revealed the majority of the respondents, 74.7%, were married, 18.9% were single, and 6.3% were widowed. This finding was in line with the age category of the respondents, where most of the respondents were elderly. The single respondents represent the youth who participated in the agribusiness supply chain and those who work as casual laborers in the agricultural farms for a living.
The study findings found out that the majority of the respondents, 45.3%, attained a primary level of education. Additionally, 33.7% of the respondents did not go to school, 18.9% achieved secondary level, and 2.1%of the respondents managed to attain university level of education. It is vivid that most agribusiness entrepreneurs have a minimum level of academic qualifications in Somaliland compared to other sectors like service and industrial. Given that agriculture is the backbone of many developing countries globally, particularly in Sub-Saharan Africa, it is carried out by the majority regardless of their educational background.
The study findings indicate that most of the respondents, 75.8% had a household size of 6–10 people followed by 2–5 people 12.6% and 11–15 people, 11.6%. The Somali culture value larger households, which are associated with the blessing from Allah. Moreover, the use of family planning is highly prohibited among Muslim communities. The average family size is comprised of about seven people but differs from one household to another. In the agricultural sector, more family members are an asset since they are the primary source of labor.
The study results show that the majority of the respondents, 32% had a low-income level of $100-$150 followed by $200-$250 26%, $150-$200 24%, $250-$300 14%, and finally above $300 4%. This follows low wage rates in the agribusiness sector, where most of the respondents work as a source of labor on the farms or along the agribusiness supply chain.
Econometric Results
The study adopted the use of linear logistic regression technique to determine the association between the study variables.
Table 2
Summary of (OLS) Logistic Regression Results on Factors Affecting Performance of Agribusiness Enterprises in Somaliland Module summary
Variable | B | S. E | Sig. |
Constant | 0.024 | 0.021 | 0.245 |
Availability of farm inputs | 0.231 | 0.3276 | 0.572 |
Price fluctuation | -0.854 | 0.745 | 0.013 |
Prolonged drought spell | -0.462 | 0.030 | 0.029 |
Land size | 0.377 | 0.439 | 0.431 |
Irrigation | 0.629 | 0.343 | 0.007 |
Access to extension services | 0.261 | 0.052 | 0.002 |
Access to capital | 0.307 | 0.024 | 0.027 |
Greenhouse technology | .817 | .497 | .000 |
Education level | 0.012 | 0.064 | 0.875 |
Use of mobile money transfer | 0.761 | 0.462 | 0.000 |
Availability of farmers’ cooperative societies | 0.439 | 0.219 | 0.066 |
Source survey data, (2020) |
The study findings indicated that price fluctuation was statistically significant (p-value 0.013) but with a negative slope (-0.854). This denotes that agribusiness enterprises in Gabiley are price elastic. Just like in other developing countries, the price of agricultural commodities n Somaliland varies with seasons and market forces of demand and supply. Nevertheless, large volumes of agricultural produce imports from Ethiopia is the primary contributor to fluctuating prices of agricultural commodities Somaliland. The result conforms to economic theory that states an inverse relationship between the cost of the commodity and the quantity of the item demanded by a rational consumer. A similar finding was obtained by (Boadu 2018, FAO, 2018 and Walala et al., 2014).
The variable prolonged drought spell had a negative relationship (-0.046) but a robust statistical significance level with a p-value (0.029). This implies that instances of drought spell discourage agribusiness entrepreneurs in the Gabiley district from participating in the production of vegetables. This is because agribusiness entrepreneurs in the Gabiley district heavily rely on rain-fed agriculture. The majority of farmers do not use irrigation systems due to the high cost of the drilling and installation process.
Entrepreneurship training was statistically significant p-value (0.007) and with a positive slope (0.629). The findings reveal that agribusiness entrepreneurs who acquired agribusiness skills performed well. The entrepreneurship training programs have the potential of building the capacity of farmers to practice agricultural production as a business rather than as a subsistence. The training also creates awareness to farmers to embrace modern farming methods to increase their productivity and profitability per unit of land under the production process.
Agricultural extension services had a positive association (0.261) with a solid statistical significance level with a p-value (0.002). The findings indicate that farmers who accessed the extension services performed much better than their counterparts who didn’t. The agricultural extension services provided the farmers with technical agricultural skills ranging from land preparation, spacing, planting, management practices, pest and diseases control, harvesting, value addition, and marketing of agricultural produce.
Access to capital was statistically significant p-value (0.027) and with a positive slope (0.307). The findings denote that farmers who received agricultural start-up capital were performing better, unlike those with no access to capital. Most agribusiness entrepreneurs access the capital from commercial banks, government support, and grants from non-government organizations and development partners in Somaliland. The capital obtained includes the supply of farm inputs (seeds, chemicals, and fertilizer), farm machinery, solar panels, greenhouses, and irrigation system.
Greenhouse technology was a statistically significant p-value (0.000) with a strong positive association (0.817). The result indicates that agribusiness entrepreneurs who used greenhouse technology performed better in the Gabiley district than farmers who practiced open-field vegetable production. Although the farmers eluded that the initial greenhouse investment capital was too high, it helped them control notorious vegetasble pests and diseases and optimized farm inputs. Many studies in the literature have similar findings (Olowa, 2015; Nzioki, 2015; Musa et al., 2020; FAO, 2018).
The use of mobile money transfer revealed a positive relationship (0.761) with a robust statistical significance (0.000). The findings denote that digital mobile money transfer services play a crucial role in ensuring real-time monetary transactions. The study results further show that the majority of the respondents use Telesom (Zaad) and Somtel (e-dahaab) services.