An assessment of factors influencing performance of milk marketing cooperatives in Nakuru County

Abstract

Nakuru County annual report indicates that over 70% of the dairy cooperatives societies in the County are either dormant or have collapsed. The purpose of this study was to determine the factors that have contributed to the poor performance of milk marketing cooperatives in Nakuru County. Specific objectives of this study were to investigate the influence of transaction costs, management, policies, competitors and infrastructure on the performance of milk marketing cooperatives. Research hypotheses to be tested were that all the independent variables had no effect on cooperative performance. This study was guided by the theory of cooperatives. Target population for this study was the managers of the milk marketing cooperatives and the dairy farmers. Since the target population was small, a census of active cooperatives was taken hence the selection of 16 cooperative managers and a sample of 140 active cooperative farmers. Structured questionnaires were used to collect data. Data collected was coded and systematically organized so as to facilitate data processing using Statistical Package for Social Sciences (SPSS). Data was analyzed using multiple regression analysis where dependent variable was regressed on independent variables. The study found out that independent variables account for 65.4 percent variations in dependent variable. The F value of 22.08 indicated that joint contribution of all the independent variables was significant in predicting the dependent variable. However, the independent variables which affected significantly the performance of milk cooperatives were management (β2 = 0.96), policies (β3 = 0.97), competition (β4 = 0.787) and infrastructure (β5 = 0.728). These findings may help in strengthening the performance of the cooperatives and the researcher is recommending the creation of a favourable working environment for the cooperative farmers so as to enable them earn profits and thus improve their living standards.