Market orientation and integration of developing countries with global
market: Case studies of agricultural export chains in Benin
Adekambi, S.A.*, P.T.M. Ingenbleek** and H.C.M. van Trijp***
*
**
PhD student in Marketing, Wageningen University, the Netherlands
(adeyemi.adekambi@wur.nl).
Assistant Professor of Marketing, Wageningen University, and researcher at the Agricultural
Economics Research Institute, The Hague, the Netherlands (paul.ingenbleek@wur.nl).
***Professor
of Marketing, Wageningen University, the Netherlands (hans.vantrijp@wur.nl).
Paper prepared for the presentation at the Wageningen International Conference on Chain
and Network Management (WICaNeM 2012)
Conference
Wageningen, The Netherlands
23 - 25 May 2012
1
Market orientation and integration of developing countries with global
market: Case studies of agricultural export chains in Benin
Abstract
The paper aim at understanding how market orientation processes function in
international chains from developing countries and discuss factors that stimulate or impede these
processes. The extended case study method combining the literature on market orientation and
market integration literature is applied to four agricultural export chains with different success
stories in Benin. The findings indicate that market orientation processes occur between different
actors in the chains. Market intelligence enters the chains through exporters. The strategic
information comes in not from transaction partners but from the institutional environment.
Critical implications for downstream companies and NGOs and policy makers are discussed.
Keywords: Developing country, market integration, international export chain, market
orientation, Benin.
Introduction
Developing countries are becoming increasingly integrated in the world economy (e.g.
World-Bank 2008). They are recognized by multinational corporations for their market potential
(e.g. Prahalad 2008), and as a source for supplies and production labor (e.g. Maertens and
Swinnen 2009). Development economists argue that this integration of developing countries into
the global market place stimulates their economic growth (e.g. Govereh and Jayne 2003) and
alleviates poverty (e.g. Maertens and Swinnen 2009). Numerous projects are therefore conducted
by Non-Governmental Organizations (NGOs) and donor countries to create access for poor or
small scale producers in developing countries. For instance, the project Novella in Tanzania, one
of the Unilever initiatives, trains farmers to produce in an environmentally sustainable way highquality Allanblackia nuts1. However, creating access to international markets is one thing,
remaining competitive on that market by continuously creating value and satisfying customer
demands is another.
The marketing literature argues that gaining sustainable competitive advantage depends
on firms’ competences in identifying and satisfying the wants and needs of customers more
effectively than their competitors do (Kotler 2000). From the perspective of international export
chains, this means that small scale producers in developing countries they should be oriented
towards export markets (Cadogan et al. 2009; Racela et al. 2007).
Market orientation (MO) is conceptualized as the organization-wide generation and
dissemination of and responsiveness to market intelligence (e.g. Kohli and Jaworski 1990). Over
the past years, the importance of MO to business performance has received considerable
attention in the marketing literature (Kirca et al. 2005). But much less attention has focused on
the role of MO in developing countries. Therefore, a limited insight exists on the role that the
1
See www.worldagroforestrycentre.org/projects/allanblackia/supply.html, accessed November 25, 2011.
2
MO concept can fulfill in how small scale agricultural producers from developing countries
integrate to the global market place.
The aim of this article is to better understand how MO can help to increase the export
value of developing countries. The study focuses on sub-Saharan Africa, because it is one of the
world regions with high poverty level; about 49% of sub-Saharan populations still subsist on less
than 1 dollar a day (World-Bank 2008). Consequently, we focused on agriculture as it constitutes
the main source of revenues for the majority of its populations and retained agricultural chain as
our unit of analysis. The main questions in this paper are: (1) which actors fulfill which roles in
the different market intelligence processes? (2) Which factors do inhibit and/or stimulate the
market intelligence processes (and thus MO) in the chain in a developing country? Answering
these questions has implications for development policy makers in both governmental and nongovernmental organizations.
The remaining of the paper is structured as follow. In the following sections, we first
discuss the importance of integrating small scale producers from developing countries into the
global marketplace. Next, we deal with market orientation in the chain in a developing country
and its limitations. The study method we have adopted is subsequently presented, followed by
results and discussions. Through the final section, we conclude the study and formulate
implications for downstream companies, NGOs and policy makers.
BACKGROUND
Market integration as a way out of poverty
Market integration (MI) is seen in the development literature as a critical development
element for developing countries (e.g. Roy and Thorat 2008). Its effects have been widely
investigated. It is shown that MI leads to growth effects (e.g. Kutan and Yigit 2007; Romalis
2007) and improvement of small scale producers’ livelihoods (e.g.Balat et al. 2009; Kilic and
Carletto 2009; Maertens and Swinnen 2009). However, such a change in livelihoods of small
scale producers comes with high risks and dependency. First, with MI small scale producers are
moving from traditional agricultural export commodities (e.g., cotton, coffee) to high value
export products (e.g., vegetables, fruits, flowers, ornamentals, condiments, spices) (e.g. Maertens
and Swinnen 2009; Maertens and Swinnen 2006); consequently, they are more dependent on
export markets. Second, as commodity prices on international markets are subjected to shocks
from time to time (e.g. Dehn 2000), small scale producers participating into international markets
might also be confronted to such price shocks affecting their income position.
Market orientation (MO): limitations to the market integration concept.
The conceptualization of MI as the amount of agricultural products that small scale
producers commercialize versus the amount used for their own living (see e.g. Bernard et al.
2008; Gebre-ab 2006) in itself doesn’t say anything about the way this MI is going to be
achieved. The MI concept focuses on the outcome of the process, not the process of integration
itself. One may thus question what may help small scale producers to make their competitive
3
advantage in the world market more sustainable. This is where MO might come in because of the
role it plays in helping entrepreneurs learn to understand what they should do to fulfill
customers’ needs and wants.
Because MO enables organizations to create superior customer value and because it is
rooted in an organization, it is a strong basis for sustainable competitive advantage (Hunt and
Morgan 1995; Slater 1997). However, MO is typically conceptualized within the context of
formal organizations, i.e. strategic business units of multi-business corporations (Homburg and
Pflesser 2000; Webster 1991). MO is seen as constituting of three elements: (1) organizationwide generation of market intelligence that pertains to current and potential customers’ needs
and wants and factors affecting them, (2) dissemination of the intelligence within the
organization, and (3) responsiveness to this market intelligence (see e.g. Kohli and Jaworski
1990).
METHOD
This study employs the extended case study method in that it studies empirical case study
data and literature in conjunction with one another (Burawoy 1991; Burawoy 1998). This method
differs from other qualitative research methods like multiple case studies in that it explicitly
intends to integrate and extend existing theory. The method typically goes through multiple
rounds of investigation in which theory and data are studied and analyzed in conjunction. In the
first round, the analysis of empirical data highlights the relevant concepts and theories from the
literatures, whereas the literature equips the researcher with useful interpretation schemes for the
data. In the next rounds, researchers keep confronting theory and data with each other, leading to
improved theory.
In this study, two streams of literature were used. First, the literature on MO provided a
basic interpretation scheme for the data collected (e.g. Kohli and Jaworski 1990). Second, we
investigated the literature from development studies and agricultural economics on market
integration. These streams of literature were completed with four case studies on agricultural
chains from Benin. Benin is located in West Africa. It is bordered on the south by the Gulf of
Gunea, on the East by the Federal Republic of Nigeria, on the West by the Republic of Togo and
on the North by the Republic of Niger and the Republic of Burkina-Faso. It covers a land area of
112,622 km2 and has a population of approximately 9.6 million (World-Bank 2010).
Case selection
The paper aims at understanding the different market intelligence processes (i.e.,
acquisition, dissemination and responsiveness) and the factors that inhibit and/or stimulate them
in agricultural export chains in developing countries. To select the cases that are enough
insightful with respect to this purpose, export stories were used as a main criterion in the
selection procedure. Four different groups of agricultural sectors came out based on this
criterion. The first is the group of successful export chains. The second group represents
emerging export chains; the third is the group of potential export chains. Non-export chains form
4
our fourth group. We then selected the most representative case for each type of group: cotton,
shrimp, shea nut and mango sectors.
The cotton sector is a traditional export chain; it is an example of a successful export
chain in Benin. The shrimp sector represent a case of a/an (re)emerging export chain from Benin
because of its export which is now increasing. The shea nut sector stands for the potential export
chain retained in this study because of plenty market opportunities that are still unseized. Lastly,
the mango sector that we also picked out is not subjected to any export schemes and represents
our case of non-export chain.
Cotton represents the main export commodity in Benin. It is an export-oriented sector
with very successful stories. It accounts for nearly 80% of merchandise exports, 80% of total
export revenues and about 13% of the Gross Domestic Product (PSRSA 2010; World Bank
2009). The cotton sector highly contributes to the Benin’s rural economy through the
maintenance of rural roads and by enabling the access of growers to agricultural inputs (on
credit). Moreover, its revenue contributes to the building of socio-community infrastructures
such as health centers, schools, wells. Cotton is largely cultivated in the north and central part of
Benin. It is produced by small producers with farm sizes between 1 to 14 hectares.
Shrimp constitutes a particularly valuable export fishing product in Benin. Its export
represents 1% of Benin’s exports (STDF 2008). It generates substantial revenues and foreign
exchange for the country. For example, the export value gained from the shrimp sector has
increased from 557.75 million in 1999 to 2.15 billion FCFA in 2002. However, because of the
self-ban Benin observed between July and January 2005, its shrimp export value decreased to
0.203 billion FCFA a year during this ban period. Since 2006, i.e. after the identified technical
problems were fixed and investments in inspection systems, labs and training were made, Benin
shrimp exports are expanding. The sector employs approximately 45,000 permanents
fishermen(Le Ry et al. 2007).
The shea tree (Vitellaria paradoxa ) is a wild fruit tree with valuable nutritional and
economic resources. The butter derived from its nuts is used as a raw material in chocolate and
other food industries. Annually, an average of 14 000 tons of shea nuts is produced and marketed
in Benin, and about 33 tons of shea butter is exported. The sector has many development
opportunities on the international market. For example, 95% of the world exchange shea nuts are
imported by chocolate industries as a raw material.
Mango (Mangifera indica L., Anacardiaceae), a tropical fruit from India, plays an
important role in the economies of Sub-Saharan African countries. It constitutes an important
source of energy and micronutrients such as potassium, alpha-carotene, vitamin C and calcium
(Vayssieres et al. 2008). Despite its importance as potential tropical commodity export in SubSaharan countries, mango production in Benin is still marginalized compared to other countries
(e.g. Côte d’Ivoire, Mali). The bulk of the production is sold on domestic markets (Van Melle et
al. 2008).
Data collection
5
We collected information from multiple sources of evidence: secondary data, experts and
small scale producers interviews. Secondary data were collected through desk research. It
consisted of consulting articles, research reports, working papers and documents on the four
selected agricultural sectors. We used a structured protocol during the interviews. The structured
protocol was prepared using the information from desk research. Yin (1994) argued that it is
helpful to have prepared in advance the research protocol because it contributes to minimizing
omission errors during data collection and enhancing the reliability of the research. The
interview protocol included two sets of question: (1) key agricultural sector characteristics, key
actors and their respective roles in the different market intelligence processes; (2) factors
constraining or stimulating this market intelligence processes at the level of each agricultural
sectors.
The researchers conducted focus group discussions with experts from each of the four
selected agricultural sectors. For each focus group, researchers started by describing the
objectives of the study first. A tape recorder as well as hand recorder was used when conducting
the interview and focus group discussions. The recording was transcribed during the data
analysis. Each focus group nearly took one hour and fifteen minutes. A total of 17 semistructured interviews were conducted with experts (5 were respectively experts in cotton, shrimp
and shea nut sectors, and 2 were mango sector experts). Of 17 experts interviewed, 6 are
researchers (2 from National Institute of Agricultural Research of Benin, 1 from University of
Parakou and 2 from International Institute of Tropical Agriculture), 3 were employed in
government institutions, 4 were from NGOs and working on Projects, 3 from farmer
organizations and 1 a company manager.
RESULTS
How does an export chain in developing countries work?
Figure 1 displays the functioning of an export chain in developing countries. It is summarized
from the four agricultural sectors we selected. It shows a stylized international export chain that
is based on an informal economy. It helps understand the way market orientation processes occur
in such a chain. Such export chains link individual small scale producers and traders in the
informal economy to exporters and other players in the importer country belonging to formal
economy. Consequently, regarding these links, MO concept might be more difficult to apply
without paying close attention to other actors in the system. Market intelligence which is critical
for responding to market trends (e.g. Kohli and Jaworski 1990) comes in the chain through two
sides: through the chain itself and through the institutional environment (IE) surrounding the
chain.
Market intelligence processes in the chain
Market intelligence enters the chain and is disseminated through chain connections.
Mainly, market feedback from direct customers enters the (studied) chains through exporting
companies. In the four cases, this information about market demands that exporting companies
search for is, however, limited to their customers’ (current) needs and wants. Exporting
6
companies mostly know a very little about the future needs and wants of their customers, their
(potential) competitors (like substitute products or competition from other countries, etc.) and
other environment factors that can affect their businesses. Exporting companies mainly acquire
their information through business travels to their importers’ countries (e.g., multinationals,
retailers).
This market intelligence flows along the chain from downstream to upstream actors i.e. in
the opposite direction of the goods. In the studied agricultural sectors, exporting companies pass
the relevant information on to their (immediate) suppliers, i.e. (sub) collectors (e.g., shrimp and
shea nut sectors) or to extension services (e.g., cotton sector). The dissemination of market
information to collectors and sub-collectors in the chain and/or to extension services is carried
out either through formal or informal meetings.
Traders (i.e. collectors and/or sub-collectors) respond in their way by forwarding the
information they received to upstream suppliers. The interviews showed, however, that collectors
only content themselves with the information obtained from their partner exporters. They
communicate the information about the market requirements to small scale producers by means
of social networks (e.g., informal village discussions).
Responsiveness to requirements demanded by export markets occurs at the level of small
scale producers. These latter take necessary actions to effectively respond to market intelligence
they sensed, i.e. by implementing good (agricultural/fishing/processing) practices and other
quality and safety measures, by growing/fishing varieties and qualities demanded by the market,
by selecting qualities suitable for export, etc..
Intelligence is also acquired on an institutional level, for example in negotiations between
(Benin) government or sector organizations with institutions, multinationals, retailers or other
actors from the export market country (except the mango sector2). More importantly, strategic
information, i.e. future customers’ needs and wants, chain potential competitors and factors
affecting them, is ensured by the IE surrounding the sectors. The intelligence acquired by these
institutions is directly disseminated through workshops to extension workers, NGOs and other
actors that communicate with small scale producers and traders. For instance, most of cotton
growers receive every year information on quality requirements and technical itineraries from
extension service agencies.
Factors that hinder the flow of market intelligence in the chain
Many constraints stand in the way market intelligence flows in the export chain. These
constraints vary according to the different components of market intelligence processes, i.e.
acquisition, dissemination and responsiveness
Market intelligence generation
2
The mango sector is short of a such institutional support because government and NGOs
assistances are (completely for the case of the government) absent
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Information about market demands, i.e. what to deliver, guaranteed by means of technical
regulations such as food safety and quality regulations (e.g. Dey et al. 2005; Willems et al.
2005), are not always accessible to every chain partners, especially collectors and small scale
producers. Market intelligence is costly to individual collectors and/or small scale producers to
generate.
Market intelligence not only has to do with customer needs and wants, but it also
concerns strategic information such as future customers’ needs and wants, current and potential
competitors, government regulations and factors affecting them (Kohli and Jaworski 1990).
However, chain actors are disregarded to such important information, i.e. strategic information.
Hence according to the experts interviewed, although some of the exporting companies are
conscious of the existence of (potential) competitors, they do nothing to know who these
competitors are, what their strengthens and weaknesses are, etc.
Market intelligence dissemination
Market intelligence dissemination along the chain is particularly hindered by ineffective
chain relationships and the informal nature of the economy in which actors in developing
countries are involved. High market information costs lead to the increase of risk for
opportunism(see e.g. Akerlof 1970). Interviews showed two main cases. The case of the cotton
sector where actors are directly provided with market information by the extension services. The
second case was concerned with the other studied agricultural sectors in which extension
services are either rarely provided (shrimp and shea nut) or not at all (mango). At the level of
these latter sectors, traders usually profit from market information they accessed to (especially
price information) to gain advantages at the detriment of small scale producers. As a
consequence, the upstream actors all the time feel cheated by their subsequent clients. As experts
noted, nobody in the chain, except exporter, does rely on information (in particular price
information) (s)he gets from its precedent partners. Subsequent actors in the chain, in particular
small scale producers, always express their distrust to (price) information traders sometimes
provide them with. One of the shrimp experts we discussed with during the interviews told us
that shrimpers always claim that they can never once trust in price information their customers
(i.e. traders) provide them with, because a such information sources are mostly not trustworthy.
The dissemination of market intelligence within export chains is also constrained by the
informal nature of the economy in developing countries. Hence, this economy is highly informal
(see e.g. Charmes 2000; Joshi et al. 2009). Informal sectors referred to all unregistered taxable
economic activities that include unreported income from the production of legal goods and
services, either from monetary or barter transactions (see e.g. Schneider 2004) and are
characterized by many intermediaries between small scale producers and consumers (Fafchamps
and Minten 1999; Gabre-Madhin 1997). Transactions in the studied agricultural sectors are
informal by nature. Small scale producers are connected to customers (e.g., exporting
companies) via village collectors (i.e. intermediary buying agents at the village level who collect
products from many small scale producers), traders and sometimes brokers (i.e. intermediary
commission-agents whose role is to help their clients get contact with right product
buyers/sellers). As such, small scale producers are quite remote from exporting companies of
their chain leading to information distortion when it comes to transfer of information across the
chain. Moreover, the large number of small scale producers that informal economies are dealing
8
with also make market intelligence difficult to disseminate in that these small scale producers
become troublesome to reach all.
Responsiveness to market intelligence
For those small scale producers who are aware of market requirements, the cost of
compliance with them is too high because of necessary investments they require. Whilst, except
the cotton sector3, interviews showed that actors are short of investment capital. Such situation is
even worse at the level of small scale producers. This is because, first, actors often lack physical
collaterals that are required by financial institutions for providing them with loans. Second, the
high cost of loan, i.e. the interest rate, which is generally between 36% and 47 % at the level of
(micro) financial institutions remains another big constraint preventing actors from having access
to (adequate) investment capital. The amount of money chain actors get from informal sectors
such as saving clubs is still far below their financial requirements.
Actors in the studied agricultural sectors also suffer from lack of necessary infrastructures
such as farm-to-market roads, market infrastructures (e.g. hangar, packing houses and storage
facilities) and communication infrastructures. Participating into a complex chain such as
international export chains requires not only some prerequisites such as a good network road
infrastructures, access to market information and capital but also entrepreneurial behavior from
actors (small scale producers in particular) because of huge competition level they might face on
these large scale markets. According to the experts we interviewed, small scale producers in the
four agricultural sectors studied lack of entrepreneurial attitudes and behaviors in two main
ways. First, they show a remarkable sameness in their production, sourcing and/ or marketing
practices. Second, small scale producers are often half-hearted entrepreneurs because of their
tradition of security and stability that leads to risk-taking avoidance.
DISCUSSION AND CONCLUSION
This study makes an effort to understand how market intelligence processes (and thus
MO) function in export chains in developing countries. The constraints to the well-functioning of
the processes of MO and the potential role of the IE surrounding agricultural sectors are also
discussed. The results from our four cases of agricultural sectors show that although the four
agricultural sectors differ in terms of their export stories, the concept of MO applies to all of
them. Information on customers’ needs and wants and on market trends, however, is missed in
non-export agricultural chains. Market intelligence penetrates the chain through exporting
companies and through the IE surrounding it. This market intelligence then flows along the chain
from the downstream, i.e. exporting companies, to upstream actors of the chain. Prior studies
indicate that MO processes happen at the level of the same organization (see e.g. Kohli and
Jaworski 1990; Kohli et al. 1993). We state that in (agricultural) export chains, market
3
Production inputs such as seeds, fertilizers and pesticides are supplied on credit to
farmers at the beginning of each season for a fixed-price market agreement for the outputs.
9
intelligence processes (i.e., generation, dissemination and responsiveness) occur between
different actors and IE or take different forms for different actors. Responsiveness comes to pass
at the level of small scale producers and intelligence generation and dissemination at the level of
traders (e.g., exporting companies, collectors) and institutions. That is, instead of “organizationwide” to which the Kohli and Jaworski definition applies (Kohli and Jaworski 1990) we
therefore use the term “system-wide” in which the word system refers to the network of actors,
their interrelationships and institutions (see e.g. Vargo and Lusch 2004).
These findings also prove that the MO processes in export chains in developing countries
are subjected to enormous constraints of which the lack of entrepreneurial attitudes and
behaviors at the level of actors that favors entrepreneurial half-heartedness (Cole and Harris
2007; Darley and Blankson 2008; Kiggundu 1988).
This study suggests that the IE in which the export chain is evolved has a role to play in
addressing these barriers and enabling the functioning of market intelligence processes in an
international export chain. For example, the feedback processes from customers to their own
customers are stronger in the cotton and shrimp sectors because many institutions and
organizations such as NGOs and projects that play a specific role about what information should
be bring in and how it should be communicated between the chain are present. In contrast, these
feedback processes are lacking in the mango sector in that NGOs and development projects are
more or less absent and the government is completely not there. These institutions such as NGOs
and/or development projects orientate, mentor and assist actors in a chain in accessing to a wider
range of necessary market intelligence sources including strategic information. They strengthen
through training the capacity of actors in particular exporting companies in generating and
sharing such necessary information with their trading partners. In partnerships with
governmental organizations, NGOs and development projects also help invest in physical
infrastructures such as farm-to-market roads and market infrastructures. Examples include
PAFICOT4 project for the cotton sector that trained cotton growers on good production practices
and renovated rural roads.
The factors that inhibit the MO processes in export chains can moreover be surmounted
by establishing or strengthening governance institutions between actors. Governance institutions
are formal (such as contracts and ownership) and informal (e.g., social elements such as trust)
arrangements that are deployed by the parties to support specific exchanges (Bello et al. 2004;
Carson et al. 1999). Strengthened governance institutions such as contract and trust would induce
and enhance cooperation and motivation among trading partners, because of the enabling and
supportive environment these institutions favor (e.g. Bello et al. 2004). For instance, contracts
are seen as a solution to some market imperfections such as credit market markets, technology
transfer and access to input (e.g. Key and Runsten 1999). The case of the cotton sector where
seeds, fertilizers and pesticides are supplied on credit to farmers at the beginning of every each
season for a fixed-price market agreement for the outputs can serve as an example to overcome
lack of credit in other sectors. Trust, which expresses the faith in an exchange partner’s
reliability and integrity (e.g. Fafchamps 2001) is argued to stimulate and reinforce chain
4
Projet d'Appui à la Filière Coton textile
10
relationships and augment long-term orientation (Smith et al. 2008). The example of shrimp
sector is illustrative. Exporter companies usually finance in advance their loyal collectors and
even support them with an adapted icebox (isothermal enclosures) for storing shrimps for the
transportation. In turn, collectors offer to their (reliable) clients, i.e. fishermen, some
arrangement facilities such as financial support.
Our results have several important implications in particular for (1) downstream
companies, and (2) NGOs and policy makers. In general, the findings show that MO is crucial to
achieve market integration in developing countries because it helps to understand that, for
example, microcredit support to chains is not make sense if it is not make certain that necessary
market information is coming in and disseminating between actors. For downstream companies
that want to connect better to their upstream supply chains form developing countries, these
findings suggest that they must themselves adopt market orientation behaviors. The diffusion of
market intelligence acquired by these exporting companies to other actors in the chain may be
poor, perhaps because of opportunistic behavior problems. These finding also suggest to
downstream companies that they must bring into action with their partners, small scale producers
in particular, appropriate contractual arrangements to stimulate and foster their market
responsiveness. Another implication of the results to exporting companies is that the
development and the use of informal exchange relationships such as trust is of importance in
encouraging market responsiveness because intelligence dissemination can be fostered by
stimulating trusting relationships between actors in the chain.
For NGOs and policy makers that aim to improve market connections of developing
countries with international export markets, these findings suggest that they first must strive
themselves to become (more) market oriented. Because whether the chain can successfully be
responsive to (quality) demands depends also on the IE. Adequate market intelligence including
strategic information has to be acquired and enabling environment must be created to facilitate
the dissemination of this intelligence to extension workers, NGOs and other actors that are
directly in contact with small scale producers for adequate purpose. Such an enabling
environment cannot be reached unless institutions themselves adopt market orientation
behaviors.
Given that the generation, dissemination and responsiveness to market intelligence
happen at different levels in the chain, further research should characterize market
responsiveness at the level of small scale producers, investigate its (potential) antecedents and
consequences. Preferences for contract arrangements systematically does not imply that single
contract would be applied everywhere and to every chain actors. Future research might also be
needed to explore different contract arrangements that might be of importance in enhancing
market responsiveness at the level of small scale producers.
11
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Export market
Developing country
Traders
Small scale producers
Exporters
Importers
Downstream players
and consumers
Network of
collectors, brokers
customers’
needs &
wants
Strategic
information
Information
dissemination
Strategic information [future customers’ needs and wants; (potential) competitors and factors affecting them]
provided by the institutional environment
Information processing
Informal economy
Formal economy
Figure 1: Export chain in developing countries
Actors in informal economy
Actors in formal economy
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