Adoption and willingness to pay for agriculture e-commerce market services : case study of fresh produce smallholder farmers in Gauteng Province , South Africa

Abstract

The process of buying and selling agricultural goods and services on the e-commerce is a phenomenon that is experiencing an increment and is also becoming a common place for conducting business. The e-commerce has become valuable for the growth of businesses in almost all sectors of the economy and agriculture is no exception. However, despite the obvious potential of new technology-based interventions and innovation in the agricultural sector, there is still inadequate research on agriculture e-commerce in South Africa. The aim of the study was to gain an understanding of the adoption, willingness to pay for agriculture e-commerce platform services and factors influencing the willingness to adopt agriculture e-commerce. The study was conducted in three municipalities in the Gauteng province, namely, City of Tshwane Metropolitan Municipality, City of Johannesburg Metropolitan Municipality, and Sedibeng District Municipality. Multi-stage sampling procedure was used to select 120 fresh produce smallholder farmers. The collected data was captured on Statistical Package for Social Science (SPSS) version 28. Several analytical tools were employed to run the analysis. For instance, descriptive statistics was used to identify and describe the socio-economic characteristics of fresh produce smallholder farmers. The Binary Logistics Regression model was employed in the study to identify factors affecting the willingness to adopt agriculture e-commerce platform among the sampled farmers. The findings of the study infer that male fresh produce smallholder farmers are most likely to adopt agriculture e-commerce than their counterparts. Furthermore, the study found that farmers who are aware of agriculture e-commerce, had access to market information from a certain source and whose main occupation is farming were more likely to adopt and to be willing to pay for agriculture e-commerce platform services. The results of the study revealed that 69% of sampled farmers were willing to adopt agriculture e-commerce while those who were not willing to adopt was 31%. From the results of willingness to adopt agriculture e-commerce the study further established whether the sampled fresh produce smallholder farmers had already adopted agriculture e-commerce, either the farmers sold their produce or had bought agricultural inputs on the e-commerce platform. The results indicate that, 59% of sampled farmers already sold their produce or had bought agricultural inputs on the e-commerce platform and 41% had never sold their produce or bought any agricultural input on the e-commerce platform. The study further revealed that 79% of farmers who were willing to adopt agriculture e-commerce were also willing to pay a premium to access such services and only 21% were not willing to pay a premium. Although the farmers were willing to pay for agriculture e-commerce platform services, the study found that farmers were only willing to pay low premiums (less than 10% premiums). The Binary Logistics Regression model results indicated that gender was significant at 10% significance level and had a negative relationship with willingness to adopt agriculture e-commerce. Furthermore, marital status, occupation, source of market information, source of transport, and willingness to pay for e-commerce platform services were found to be statistically significant at 10% significance level and had a positive relationship with willingness to adopt agriculture e-commerce platform. Moreover, agriculture e-commerce awareness was found to have a positive statistically significant influence on the willingness to adopt agriculture e-commerce platform at 5% significance level. Based on the findings, the study recommends that there should be an improvement on the dissemination of market information through extension services so that farmers will have access to reliable market information, dissemination of market information through social media by relevant stakeholders to enable access to reliable market information as most farmers get their market information on social media platforms. Furthermore, the study recommends the provision of reliable subsidised transport that can be used by a group of farmers in their respective areas at a fixed fee. Lastly, the regulation of agricultural trading on the social commerce (social media platforms).