Journal of
Development and Agricultural Economics

  • Abbreviation: J. Dev. Agric. Econ.
  • Language: English
  • ISSN: 2006-9774
  • DOI: 10.5897/JDAE
  • Start Year: 2009
  • Published Articles: 443

Full Length Research Paper

Effects of marketing costs on gross margin: Evidence from guinea corn retailers in Wukari, Taraba State, Nigeria

G. O. Onogwu
  • G. O. Onogwu
  • Department of Agricultural Economics and Extension, Federal University, Wukari, Taraba State, Nigeria.
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Osayi, Chinwe Prisca
  • Osayi, Chinwe Prisca
  • Department of Agricultural Economics and Extension, Federal University, Wukari, Taraba State, Nigeria.
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K. I. Okeke-Agulu
  • K. I. Okeke-Agulu
  • Department of Agricultural Economics and Extension, Federal University, Wukari, Taraba State, Nigeria.
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  •  Received: 09 February 2018
  •  Accepted: 18 June 2018
  •  Published: 31 August 2018

Abstract

This study assessed the effects of marketing costs on the gross margin of guinea corn retailers in Wukari, Taraba State, Nigeria. The main aim of the study is not to only obtain precise costs and margins estimates for the conventional marketing functions of guinea corn, but rather to make the result of the analyses usable to devise a policy framework for an effective marketing strategy and improvement in the efficiency of guinea corn marketing and agricultural produce/products markets in Taraba State and Nigeria in general. Structured questionnaire was used to illicit response from forty guinea corn retail marketers across six local government areas of the state during the 2017 marketing season. Descriptive statistics were used to analyze the data collected, while Ordinary Least Squares Analytical Procedure was used to determine the parameter estimates of marketing costs. The average retailers’ gross margin per 50 kg bag stood at N1,036.16, while price and transportation cost per 100 kg bag is N17,472.00 and N249.00, respectively. Storage cost for six months period stood at N163.00 per 100 kg bag. The results showed that retailers’ selling price, transport cost, storage and cost due to perishability have significant effects on retailers’ gross margin, at 8, 5, 10 and 9% levels, respectively. It is recommended that transportation facilities should be sustained by government, private individuals and corporate groups in addition to intensification of research into post-harvest storage and processing techniques. Again, funds and storage facilities should be made available to the marketers to enable them take advantage of bulk purchasing during harvesting seasons to ensure market expansion that will improve guinea corn marketing cum retailer gross  margin like in the study area.

Key words: Guinea corn, marketing costs, marketing margin, retailers.