Factors influencing gross profit and market outlet choice among smallholder avocado farmers in Greater Tzaneen Municipality, Limpopo Province, South Africa

Abstract

The agricultural sector is essential in the economic growth and development prospects of most countries that are developing, including South Africa, where agriculture is the foremost provenience of income and provides direct employment. Avocado (Persea americana) is a pear-shaped, nutrient-rich fruit native to Central America. Despite the fruit’s growing popularity and potential, smallholder farmers grapple ongoing issues that hinder their ability to increase profits and reach premium markets. The aim of this study was to explore the factors that influence the gross profit and the choice of market outlets among smallholder avocado farmers in GTM, Limpopo province. The objectives of the study were to identify and describe the socio-economic characteristics, to analyse the factors influencing gross profit and the choice of market outlets of smallholder avocado farmers in GTM. The research was conducted in the GTM. Convenience sampling technique was used to select 97 smallholder avocado farmers sample size. Primary data was collected using a structured, closed-ended questionnaires administered digitally. The data was analysed using descriptive statistics, MLR and the MLM models. SPSS version 29.0 was utilised to process and analyse the data. The MLR results show that avocado yield (p<0.01), access to credit (p<0.01), farm size (p<0.05), household income (p<0.05), and age (p<0.05) significantly and positively influence gross profit. Conversely, household size (p<0.05) and employment status (p≈0.05) have negative effects on profit. The MLM results indicate that gender, level of education, farm size, employment status, avocado yield, farming experience, access to transport, access to credit, household size, and group marketing significantly influence farmers’ likelihood of choosing local, farm-gate, or urban markets relative to one another (p<0.10, p<0.05, and p<0.01 levels). The study concludes that improving smallholders’ profitability and market access requires interventions that expand access to affordable credit, strengthen rural transport systems, and enhance farmer organization through cooperatives. Policy implications further highlight the need for targeted support programmes that improve input affordability, promote financial inclusion, and facilitate youth participation in avocado production.