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International Journal of Management (IJM)

Volume 7, Issue 4, May–June 2016, pp.17–42, Article ID: IJM_07_04_002

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VALUE CHAIN ANALYSIS OF GUAVA:

PRODUCER, RETAILER AND CONSUMER

PERSPECTIVES

Hena Imtiyaz

Research Scholar

School of Environment, Resource and Development,

Asian Institute of Technology, P.O. Box 4, Klong Luang,

Pathumthani 12120, Bangkok, Thailand

Peeyush Soni

Associate Professor

School of Environment, Resource and Development,

Asian Institute of Technology, P.O. Box 4, Klong Luang,

Pathumthani 12120, Bangkok, Thailand

ABSTRACT

The present study was conducted in Kaushambi district (25° 20’ N and 81°

23’ E, 98m above mean sea level), India during October, 2014 to February,

2015 to perform value chain analysis for guava. A comprehensive survey was

conducted in relation to market infrastructure, transportation services,

storage facilities, processing industry, export market, information flow,

material flow, transparency, linkage, relationship, collaboration, commitment

& trust, cutting edge technology and consumer insights. The value chain

analysis of fresh guava on producer and retailers’ perspective / feedback

revealed that procurement and application of agricultural inputs, availability

and adaptation of technology, market infrastructure, material and information

flow, status of food processing industry, transportation services, cutting edge

technology and consumer insight are efficient and effective, whereas

transparency, collaboration, commitment and trust are not satisfactory. The

value chain analysis for guava on consumers’ perspective / feedback revealed

that market infrastructure, information flow, materials flow, linkage,

commitment and trust in exiting value chain of guava are satisfactory.

However, transparency and relationship in existing value chain of guava are

weak. The consumer gives more emphasis / importance to quality, nutritive

value, safety and price as compared with packaging and service rendered by

retailer for purchasing of fresh / processed guava products.

Hena Imtiyaz and Peeyush Soni


Key words: Value Chain, Consumer Insights, Information Flow, Materials

Flow, Relationship, Collaboration, Commitment and Trust, Transparency,

Guava.

Cite this Article: Hena Imtiyaz and Peeyush Soni. Value Chain Analysis of

Guava: Producer, Retailer and Consumer Perspectives. International Journal

of Management, 7(4), 2016, pp. 17–42.

http://www.iaeme.com/ijm/issues.asp?JType=IJM&VType=7&IType=4

1. INTRODUCTION

Value chain management system represents a set of value added activities in

designing, producing, marketing, delivering and supporting products and services

providing a competitive advantage to the product. Unlike supply chain management,

the emphasis in value chain is given to consumers. The focus in value chain is to

understand the desired consumer value by moving downstream in the chain and

delivering it efficiently and effectively to consumer (Fearne et al. 2009).

Value chain analysis is defined as the multi-dimensional assessment of the

performance of value chains including the analysis of material flow, information flow,

management and control of the value chain (Taylor, 2005). Value chain management

involves the collaborative allocation of resources within and between the respective

business in the chain to deliver more value addition at lower cost and at a faster rate.

Value chain approach provides a framework to analyse the nature and

competitiveness in which small farmers can participate in potential market (Rich et al.

2011). Value chain analysis gives profound knowledge on the markets, relationships

across the chain, participation of different actors, critical constraints and

competitiveness of the farmers (Soosey et al. 2012). The basic components of value

chains are information flow, material flow, transparency, linkage, relationships,

collaboration, trust and commitment, cutting edge technology and consumer insights.

Material and Information flow are the two key factors which are important for value

chain integration (Lee et al. 2000; Vickery et al. 2003; Zhou and Bentn, 2007;

Lindquist et al. 2008; Pereira, 2009; Projago and Olhager, 2012).

The transparency in food supply chains is still in a primitive stage in context to

food quality and safety (Florini 2007; Mol 2008; Mol 2014). In order to manage and

find solution to complexities existing in food supply chain transparency, the supply

chain partners should coordinate as well as create an atmosphere to share the data and

information among each other (Hvolby et al. 2010; Verdouw et al. 2011). The present

day consumers are having keen interest regarding the transparency in quality, safety

and storage at each stage of food supply chain (Beulens et al. 2005; Wognum et al.

2011; Mol, 2014). The strong and cordial relationship amongst the various players is

one of the most important aspects for effective and efficient food value chain (Batt

and Rexha, 2000; Gary et al. 2005; Gyau and Spiller, 2009; Musa et al. 2014).

Collaboration, trust, commitment and satisfaction are important attributes of food

supply chain relationship (Fischer et al. 2009). Supply chain collaboration reduces

procurement hazards and transaction costs (Handfield et al. 2002; Sheu et al. 2006).

Hudnurkar et al. (2014) reviewed sixty nine papers which revealed that information

sharing is the most important factor in food supply chain collaboration.

Trust and commitment are the most important components for strong and cordial

relationship amongst food supply chain partners. Mutual benefits and sharing risks

and rewards, monitoring and enforcement cost strengthen the trust and commitment

amongst the chain partners (Abdullah and Musa, 2014). Trust between the chain

Value Chain Analysis of Guava: Producer, Retailer and Consumer Perspectives


partners and sharing of information lead to effective supply chain planning and

integration (Kwon and Suh, 2005; Luque et al. 2015). It is imperative to collect

maximum information pertaining to consumers’ tastes and preferences in order to

increase the level of consumer satisfaction (Murugavel, 2010). The understanding of

consumer needs and buying behavior is critical for effective retail decision making as

well the subsequent development and implementation of a retail strategy (Levy and

Weitz, 2007).

Developing an appropriate value chain management system for fruit crops in India

would considerably improve the sustainability, competitiveness and profitability of

the agricultural marketing system, which would in turn provide better consumer

value. Development of a value chain management system is a major issue in

developing policies and strategies in order to improve the profitability and living

standards of small and marginal farmers. In spite of economic importance of guava in

Kaushambi district, India, research on value chain management determinants such as

information and material flow, cutting edge technology, linkage, relationship,

collaboration, trust, commitment, transparency and consumer insights has not been

conducted. Therefore, the objectives of the present study were to analyse and propose

a conceptual framework and strategies to improve the existing value chain

management system of guava in Kaushambhi district of India. In order to achieve the

objectives of the present study, following research questions were developed.

What are the issues in procurement of the production inputs and adoption of

technology for production of guava for local consumption and export?

What is the status of market infrastructure, transportation, storage, processing

industry and export market?

How does information flow, material flow, governance and integration between stake

holders influence the performance of guava value chains?

What are the opportunities and challenges in adapting innovative thinking in value

chain management of guava?

2. MATERIALS AND METHODS

Sustainable value chain management will facilitate and enhance understanding of

competitive challenges, help in the identification of relationships and coordination

mechanisms and assists in understanding how the innovative thinking components

should be combined with the existing supply chain management for fresh guava. This

will inevitably including wide range of activities of guava value chain analysis in

terms of production and marketing system (Fig.1).

Kaushambi is one the newly created district of Uttar Pradesh, India. The total

geographical area of the district is 2012.8 sq.km. The latitude and longitude of the

Kaushambi district are 25° 20’ N and 81° 23’ E. It lies 98 meters above the mean sea

level. It is hot in summer in which highest day temperature lies in between 250C to

480C. The district receives approximately 960mm annual rainfall. The rainy season

begins normally in the end of June/First week of July and ends in the last week of

September. The winter season lasts from November to February with temperature

ranging from 150C to 25

0C.

The survey and data collection for value chain analysis of guava in Kaushambi

district were done during October, 2014 to February, 2015. The survey was conducted

to examine the current status of value chain management of guava in Kaushambi

district, India in order to develop a conceptual framework for sustainable,

collaborative and competitive value chain. A cross sectional multi method design



using both qualitative and quantitative methods were used for data collection from

producers, retailers and consumers.

Figure 1 Conceptual model of guava value chain

The theoretical construct of the research for value chain analysis of guava include

consumer insight, material flow, information flow, cutting edge technology, linkage,

relationship, collaboration, trust and commitment and transparency (Fig. 1). The main

purpose of the survey was to assess the perception of producers / farmers, retailers

and consumers on procurements and application of the agricultural inputs, availability

and adaption of technology, market infrastructure, transportation facilities, storage

facilities, status of the food processing industry, export market, consumer insight,

material flow, information flow, cross cutting technology, linkage, relationships,

collaboration, trust and commitment and transparency. In order to assess these

variables, several items were measured under each variable using five point likert

scale “(strongly disagree = 1, disagree = 2, don’t know = 3, agree = 4, strongly agree

= 5)”.

The descriptive statistics, analysis of variance and post hoc tests for multiple

comparisons of means were used to analyse the data. The analysis was performed

with SPSS version 20.



3. RESULTS AND DISCUSSION

3.1. Producer / Farmer Perspectives

The value chain analysis from producer perspectives revealed that agricultural inputs

such as seeds, fertilizers, chemicals, water, farm machinery and electricity / fuel are

easily available for production of guava. The government and NGO’s provide

information regarding amount and time for application of agricultural inputs to the

farmers. However credit facilities as well as subsidy to purchase agricultural inputs

are not available to the producers / farmers. Furthermore, the majority of guava

farmers are not aware about the national / international food laws and regulations for

agricultural inputs mainly due to lack of coordination between farmers, chain partners

and government agencies. The analysis revealed that technology for production of

export quality guava is available, but small and marginal guava producing farmers are

not aware about production and marketing system to export fresh guava. The analysis

of market infrastructure revealed that proper road facilities and connectivity to

transport fresh guava to the market as well as appropriate storage, grading, packaging

and banking facilities are available in the market premises. The marketing activities

for sale of fresh guava is transparent, but commission charges by commission agent is

high. The analysis further revealed that facilities for marketing of fresh guava to

export market, cooperative market and supermarket are not available to farmers

(Table 1).

The analysis revealed that transport agencies and proper road facilities are

available to transport fresh guava to market timely. However, cold chain, subsidized

transport and cooperative transport facilities are not available to farmers. The analysis

revealed that cold storage and normal storage facilities are available at the market

premises. The food processing industries are available in the district. However,

farmers do not have contract farming with food processing industry and have no

access for selling guava to food processing industry directly. The food processing

industry does not provide loans information to producer in relation to quality and

safety requirements for national and international consumers. The information

regarding export market, export policies, quality and safety standards of importing

countries and logistic support for export of guava are not available to the farmers. The

analysis further revealed that small and marginal farmers do not have access to export

market (Table 1).

The analysis in context of information flow revealed that farmers / producers

receive timely information on appropriate technology for guava production,

marketing, safety and quality requirements by chain partners and government

agencies. However, farmers do not receive information regarding profit sharing

amongst chain partners. The analysis in context of material flow revealed that supply

of agricultural inputs for guava production is efficient and harvested guava is timely

delivered to market, chain partners and consumers. Producers agreed that efficient

material flow improves consumer satisfaction, chain efficiency and relationship

amongst the chain partners. The producers feedback regarding transparency revealed

that information provided by the input suppliers is accurate, genuine and reliable as

well as the quality and safety standards for production process of guava are

transparent. However, farmers clearly mentioned that marketing activities, profit

sharing and risk sharing amongst the chain partners are not transparent (Table 1).

The analysis in context of linkage revealed that producers have direct linkage with

markets. The direct linkage between producer and supermarket, cooperative market,



food processing industry, export market and consumer is extremely poor. The analysis

revealed that producers have long term relationship with input suppliers, wholesalers

and retailers. Long term relationship between producers and financial institutions,

government agencies, food processing industries, export markets, supermarkets and

consumers is weak. Joint investment between producers and input suppliers, food

processing industries and chain partners does not exist. Producers have strong

collaboration with input suppliers to get agricultural inputs timely. They have strong

collaboration with chain partners for exchange of information regarding production

and marketing of guava. The collaboration between producers and banks for financial

assistance is weak. Furthermore, producers and chain partners do not share risks and

benefits associated with the production and marketing of guava. The analysis revealed

that commitment and trust between producers and chain partners, financial institutions

and government agencies in terms of financial assistance, information sharing, joint

venture, logistic support, profit and risk sharing, etc. are poor (Table 1).

The analysis in context of cutting edge technology revealed that guava producers

use appropriate technology for production and marketing of guava because it reduces

cultivation cost, transaction cost and losses during transportation and storage. Further,

producers are using information and communication technology because it reduces

time and cost of marketing. The analysis in context of consumer insight revealed that

producers use recommended agricultural inputs and follow the national laws and

regulations for production of guava to minimize the health risk for the consumers. The

producers are aware about quality and safety preferences of the consumers and follow

appropriate storage, packaging and transportation methods. Further, producers apply

appropriate production, storage and packaging techniques to ensure pleasant taste,

appearance and competitive price for consumers (Table 1).

Table 1 Value chain analysis of guava on producer perspective, Kaushambi district, India

(Likert Scale: Strongly disagree = 1, disagree = 2, don’t know = 3, agree = 4, strongly agree =

5)

Variables

Respondent Likert

Score

Mean

Standard

devia

tion

Agricultural inputs

Agricultural inputs are easily available (Seed, fertilizers, chemicals, electricity/fuel, man power,

farm machinery, etc.) 4.45

a 0.51

Maintenance of farm equipment and machines facility is easily available 4.30

a 0.57

Agricultural inputs are available at subsidized rates. 2.15bcd

0.67

Credit facilities are available to purchase agricultural inputs 1.85

bc 0.67

Application of chemicals and fertilizers is as per the national and international regulations 2.50

bd 0.61

Information on time and amount of the agricultural

inputs is available 3.65e 0.49



Variables

Respondent Likert

Score

Mean

Standard

devia

tion

Availability and adoption of technology

Appropriate and modern technology for guava

production is available 4.35a 0.49

We are aware of appropriate and modern technology 4.55a 0.51

We are trained to use appropriate and modern technology for guava production 4.30

a 0.57

Appropriate and modern technology available for

export quality guava production 2.10b 0.72

I am aware of international/national standards, regulations and laws of agricultural technology 1.75

b 0.64

Market infrastructure

Proper road connectivity is available between farm

and market 4.40a 0.50

Storage, display, grading, packaging and banking facilities available within the market premises 4.30

a 0.47

The commission charged by the commission agent is reasonable 1.85

b 0.67

Facilities for export is available in the market premises 1.50

b 0.61

Business activities related to marketing process is transparent and satisfactory 4.05

a 0.60

Cooperative marketing and super market facilities are

available 1.65b 0.67

Transportation facilities

Transport agencies are readily available at reasonable rates

4.50a

0.51

Roads are available for efficient transportation of fresh guava 4.40

a 0.50

Cold chain transportation facilities are available 1.80b 0.70

Subsidized transportation facilities are available 1.45b 0.51

Cooperative transportation system is available 1.75b 0.64

Storage facilities

Normal storage facilities are available at farm / nearby area 2.25

acd 0.55

Cold storage facilities are available at farm / nearby area 4.30

b 0.47

Adequate storage facilities are available at the market

place 4.45b 0.51

Cold storage facilities are available at market place 2.00ace

0.65

Storage facilities are in line with specified govt. regulations 2.45

ad 0.69



Variables

Respondent Likert

Score

Mean

Standard

devia

tion

Subsidized storage facilities are available 1.80ce

0.77

Food processing industry

Food processing industries are available in district / city / farm 3.80

a 0.52

Producer have contract farming with food processing industry / unit 1.45

b 0.51

Selling guava to food processing industry is more

profitable 1.75b 0.72

Food processing industry provide loan for production of guava 1.50

b 0.51

Food processing industry provides information and guidance regarding international laws and regulations

for production, storage, quality and safety

requirements of guava

1.80b 0.70

Export market

Export market for fresh guava is available in the district / city 1.45

a 0.51

Selling fresh guava for export is more profitable 2.20b 0.77

Information regarding the export policies and

technical knowledge for production of export quality

guava are provided by govt. / NGOs / chain Partners 1.60

a 0.60

Information regarding quality and safety requirements

/ standards for fresh guava of importing countries is

provided by Govt. /NGO’s/ Chain partners/exporters 2.00

b 0.73

Govt. /NGO’s/ Chain partners provides logistic support to move fresh guava to export market 1.50

a 0.51

Small and marginal producers of guava have access to export market 1.60

a 0.50

Information flow

I receive information regarding new technology related to production of guava from Govt./chain

partners 4.05

a 0.39

I receive the information on market demand and market price of fresh guava from Chain partners 4.25

a 0.44

I receive the quality and safety requirements of fresh guava for local market from Chain partners 4.20

a 0.41

Information sharing between chain partners is good 2.00b 0.56

I receive the information regarding profit sharing amongst the chain partners 1.80

b 0.62

I receive the information regarding transportation, storage and packaging of fresh guava from chain 1.60

b 0.50



Variables

Respondent Likert

Score

Mean

Standard

devia

tion

partners

Material flow

Agricultural inputs are timely available for land preparation and production of guava (farm machinery,

irrigation, seed, fertilizers, chemicals, etc.) 4.70

a 0.39

Proper storage facility is available for storing harvested guava 2.25

b 0.44

Harvested guava is delivered to market timely 4.40a 0.41

Harvested guava is delivered to chain partners and consumers timely 4.40

a 0.56

Efficient material flow improves the overall consumer satisfaction, chain efficiency and relationships

amongst chain partners 4.45

a 0.62

Transparency

Information provided by input supplier are accurate, genuine and reliable 4.10

a 0.55

Information regarding production, marketing and profit is shared amongst the chain partners 1.55

bc 0.51

Input application, cultivation methods and production

process are traceable and verifiable 2.15c 0.49

Supply chain activities, profit sharing and risk sharing

of the chain partners are transparent 1.80bc

0.62

Quality and safety standards for production of fresh guava are transparent 4.10

a 0.64

Linkage

I supply fresh guava directly to the supermarket,

cooperative market, food processing industry and

export market 1.65

a 0.49

I supply fresh guava directly to consumer 2.35b 0.49

Direct linkage with potential market reduces transaction cost and improves profitability

considerably 4.30

b 0.47

Direct linkage with potential markets helps to offer

competitive price to consumer. 3.95c 0.39

Consumers receive considerably fresh guavas due to

my direct linkage to potential market 4.45b 0.51

Relationship

I am committed for long term relationship with

financial institutions 1.65a 0.49


government agencies 1.70a 0.47



Variables

Respondent Likert

Score

Mean

Standard

devia

tion

I am committed for long term relationship with input supplier 4.50

c 0.51

I am committed for long term relationship with wholesaler / retailer 4.30

c 0.47

I am committed for long term relationship with food

processing industry, exporters and supermarket 1.75a 0.55

I am committed for long term relationship with consumers 2.45

c 0.51

I have joint investments with input suppliers/ food processing industry /chain partners 1.60

a 0.50

Collaboration

I have agreement with bank to provide loan to purchase agricultural inputs and machines 2.00

a 0.56

Input supplier have agreement with me to supply adequate agricultural inputs timely for production of

guava 4.45

b 0.51

Chain partners exchange relevant and accurate information related to production and marketing of

fresh guava timely 4.30

b 0.57

Chain partners share risks and benefits associated with the production and marketing of guava 1.75

a 0.72

Chain partners share the knowledge and information

regarding the forecast of supply and demand of fresh

guava 3.90

c 0.31

Chain partners coordinate to find new and potential market for fresh guava 2.30

a 0.47

Commitment and trust

The financial institutions provide financial assistance

timely to purchase agricultural inputs 1.90abc

0.64

Government agencies update me with the national and

international laws & regulations and provide subsidy

on production and marketing of fresh guava 2.25

ab 0.64

Chain partners provide appropriate and economic logistics for the timely delivery of fresh guava 1.75

ac 0.44

Chain partners have joint ventures / contract farming for the production of fresh guava 1.70

ac 0.47

Chain partners have agreement for open communication in production and marketing of fresh

guava 1.70

ac 0.57

Cutting edge technology

I use advanced technology for production of guava because it reduce the cost of cultivation 4.40

abc 0.50



Variables

Respondent Likert

Score

Mean

Standard

devia

tion

I use the advanced technology because it improves the quality of the guava and increases the marketing yield

of guava 4.50

ab 0.51

I use the advanced technologies as it reduces the transaction cost 4.45

ab 0.51

I use the advanced technology for packaging of fresh

guava as it reduces the losses during transportation

and storage 4.10

ac 0.55

I use information and communication technology for marketing of fresh guava as it reduces the time and

cost of marketing 4.50

ab 0.51

I use information and communication technology in order to improve quality and safety and understand

consumer needs and preferences for fresh guava 4.20

abc 0.52

Consumer insight

I use the recommended rate of fertilizers, insecticides, herbicides and growth promoters in production

process for guava in order to minimize health risk of

consumers

4.50ac

0.51

I follow national laws & regulations for production of guava in order to minimize health risk of consumers 4.00

b 0.56

I am aware of the quality and safety preferences of consumer for fresh guava 4.45

ac 0.51

I follow the appropriate storage, packaging and transportation for fresh guava 4.35

ac 0.49

I follow appropriate production techniques, storage

and packaging methods to ensure pleasant taste and

appearance and competitive price of fresh guava to

the consumers

4.40ac

0.50

I coordinate with various stakeholders of the supply chain of fresh guava for overall satisfaction of the

consumers 4.40

ac 0.68

Within the construct, the values followed by same letter in superscript have no significant

difference (p < 0.05)

The variables which are weak in the present value chain of guava in context of

producer perspective include food processing industry, export market, transparency,

collaboration, commitment and trust. The analysis on producers perspective revealed

that improving the status of the variables which are weak shall result in higher

producer profit, improve quality and safety, improve risk sharing among the chain

partners, provide competitive price to consumers as well as improve the overall

efficiency and sustainability of the existing value chain of guava (Kognt, 1988; Esty,

2004; Park et al., 2004; Mol, 2006; Zhao et al., 2007).



3.2. Retailer Perspectives

The analysis of market infrastructure in context to retailer feedback revealed that

proper road connectivity, storage, cleaning, grading & packaging and banking

facilities are available in district and market premises for efficient marketing of

guava. However, credit facilities are not available and commission charges by

commission agent is unreasonable and high. The cooperative market do not exist in

the district and retailers have no access to supply fresh guava to supermarket. The

retailer feedback in context of transportation facilities revealed that transport agencies

are available in the district as well as in market premises and transportation charges

for fresh guava are reasonable. The governments, NGO’s and chain partners do not

provide transport facilities to retailers. Further, the cold chain facilities to transport

fresh guava to neighboring district / cities / states are not available (Table 2).

The results revealed that adequate normal and cold storage facilities for guava are

available in district / market premises. Government / chain partners does not provide

storage facilities to retailers. The retailers are not aware about national / international

norms and standards for storing guava. Food processing industries for processing of

fresh guava are available in district, but retailers have no access to supply fresh guava

to food processing industry. The analysis on export market revealed that retailers have

no access to export market, neither are they aware about the availability of export

facilities in the country / city / district. The analysis further revealed that retailers do

not receive information regarding export policies, storage, packaging and

transportation as well as quality and safety requirements of guava from government

agencies, NGO’s and chain partners. However, the retailers’ are aware about quality

and safety requirements of guava because they collect regular feedback from

consumers regarding their needs and preferences (Table 2).

The retailers’ feedback for material flow revealed that efficient road system,

loading and unloading facilities and cost effective transportation system are available

to transport fresh guava from farm to market and market to retail shop. However, cold

chain transportation system is not available to transport guava to retail shops. The

retailers’ feedback in context of transparency revealed that information provided by

chain partners regarding the marketing of guava is reliable and transparent. The

information regarding application of fertilizers, chemicals, pesticides, insecticides and

growth regulators for production of guava are not provided by the producers / chain

partners. Production process, profit sharing and risk sharing amongst the chain

partners are not transparent. The analysis in context to linkage revealed that retailers

do not provide agricultural inputs, production technology, transportation, storage and

financial loan to the producers for production and marketing of guava, but retailers

have access to purchase fresh guava directly from producer. Further, retailers do not

have access to supply fresh guava directly to supermarkets and food processing

industries, neither do they have direct linkage with producer. However, they have

direct and strong linkage with consumers (Table 2).

The retailer feedback in context to relationship revealed that retailers have cordial

and long term relationship with chain partners and consumers, but have poor relationship with government agencies, NGO’s, supermarkets and exporters for

transportation, storage and marketing of guava. The retailers did not have joint

business investment with producers, chain partners and processors. Moreover, the

collaborative activities such as supply of agricultural inputs to producer and sharing

information related to production process, jointly organizing promotional events and

sharing risk and benefits between retailers, producers, wholesalers, government



agencies and NGO’s are extremely weak. Financial institutions / banks have strong

commitment with retailers to provide financial loan to operate their business. Retailers

and chain partners have strong commitment and trust for open communication in

marketing of fresh guava. However, government agencies, NGO’s and chain partners

have no commitment and trust to provide information on national / international laws

and regulation related to production and marketing of guava. The chain partners have

no commitment with retailers to provide logistics to deliver guava to consumers

timely. The joint venture / contract farming between retailers and producers do not

exist in the current value chain of guava (Table 2).

The analysis revealed that retailers are utilizing available technologies for

transportation, packaging, storage and marketing of guava. The retailers are using

information and communication technologies such as mobile phone, internet,

electronic media etc. in order to understand consumers’ needs and preferences for

sensory, quality and safety attributes. Furthermore, government agencies and NGO’s

are not providing training to retailers for packaging, storage, transportation and

marketing of guava. The retailers are aware about regulation for storage, packaging

and transportation of guava in order to maintain nutritive value, appearance and taste

for overall satisfaction of the consumers. The analysis further revealed that retailers

coordinate with other chain partners to provide competitive price to the consumers

(Table 2).

Table 2 Value chain analysis of guava on retailer’s perspective, Kaushambi district, India

(Likert Scale: Strongly disagree = 1, disagree = 2, don’t know = 3, agree = 4, strongly agree

= 5)

Variables

Respondent Likert

Score

Mean

Standard

devia

tion


Proper road connectivity to transport fresh guava is available

4.60a 0.50

Storage, cleaning, grading and packaging facilities

are available 4.15

b 0.49

Market regulations imposed by the government are functional

2.70c 0.66

The commission charges by the commission agent is reasonable

2.40c 0.68

Proper banking facilities for financial transaction is available

4.55a 0.51

Credit, Cooperative marketing and super market facilities are available

1.65d 0.49

Transportation facilities

Transport agencies are available in district/city/farm 4.45a 0.51

Transportation charges are reasonable 4.20a 0.52



Variables

Respondent Likert

Score

Mean

Standard

devia

tion

Adequate road facilities are available for efficient

transportation of the fresh guava 4.35

a 0.49

Cold chain transport facilities are available in

district/city/farm 1.85

b 0.67

Road tax for the transportation of fresh guava is reasonable

3.50c 0.61

Transportation facilities is provided by the government / NGOs / chain partners

1.55b 0.51

Pollution control certified vehicles used for transportation of fresh guava

2.50d 0.51

Storage facilities

Normal storage facilities are available 4.05a 0.51

Cold storage facilities are available 4.55b 0.51

Storage facilities are provide by Government / NGO’s

1.55c 0.51

Storage facilities are provide by chain partners 2.30d 0.80

Storage facilities are as per the national and

international norms and standards 2.80

e 0.41

I have my own storage facilities 3.90a 0.91

Processing industry

Guava processing industry / unit exist in my town / city / district / area

3.70a 0.47

The price paid by the guava processing industry / unit is good

2.55b 0.51

Order placed by the Industry / unit for fresh guava is honoured

2.75b 0.44

Proper storage and transport facilities are provided by

the guava processing industry / unit 2.75

b 0.44

Selling fresh guava to food processing industry / unit is more profitable

2.55b 0.51

Wastage of fresh guava is minimized due to the existence of food processing industry / units

2.50b 0.51

Export market

Export market for fresh guava is available in the

country 2.45

b

0.55

Export market for fresh guava is available in the district / city

2.65a

0.51

Selling fresh guava for export is more profitable 2.40b

0.77

Information regarding the export policies and 2.64a

0.60



Variables

Respondent Likert

Score

Mean

Standard

devia

tion

technical knowledge for production of export quality

guava are provided by govt. / NGOs / chain Partners

Information regarding quality and safety requirements / standards for fresh guava of importing countries is

provided by Govt. /NGO’s/ Chain partners/exporters

1.64b

0.73

Govt. /NGO’s/ Chain partners provides logistic support to move fresh guava to export market

1.55a

0.51

Small and marginal producers of guava have access to export market

1.45a

0.50

Information flow

Information related to marketing, supply and demand of guava is provided by Govt. / NGOs / Chain

partners / food processing industry

2.25a 0.64

Information on market price is provided by Govt. / NGOs / Chain partners / food processing industry

1.70b 0.47

Information on quality and safety requirements of

fresh guava is provided by Govt. / NGOs / Chain

partners / food processing industry / consumers

3.75c 0.44

Information regarding profit sharing among the chain

partners including producers is available 1.55

b 0.51

Information regarding transportation, storage and packaging of fresh guava is provided by Govt. /

NGOs / Chain partners / food processing industry

1.50b 0.51

Material flow

I am satisfied with quantity of fresh guava moved for

marketing 4.45

a 0.51

Road transportation system for transporting guava from farm / Mandi Samiti to market place is efficient

and cost effective

4.60a 0.50

Cold chain facilities for transportation of fresh guava from Farm / Mandi Samiti / market are available

1.65b 0.59

Loading and unloading facilities for fresh guava are available

3.80c 0.89

Proper road transportation system for transporting

fresh guava from Farm / Mandi Samiti to food

processing industry is available

4.45a 0.51

Transportation of fresh guava through rail transport

system is available 4.65

a 0.49

Transparency

Information provided by producer/chain partners is adequate, genuine, reliable and transparent

4.30a 0.57



Variables

Respondent Likert

Score

Mean

Standard

devia

tion

Information regarding the application of fertilizers,

pesticides, insecticides and growth promoters is

available and transparent

1.85b 0.49

Information regarding the production process and

marketing of guava is available and transparent 1.90

b 0.55

Production process, transportation, packaging and marketing are traceable and verifiable

2.40c 0.50

Supply chain activities, profit sharing and risk sharing of chain partners are transparent

1.60b 0.50

Business activities of the chain partners are transparent

3.65d 0.49

Linkage

I provide agriculture inputs, new production technology, transportation facility and financial loan

to the producer

1.50a 0.51

I provide storage facilities to the producer 1.85a 0.67

I purchase guava directly from the producer 3.55b 0.76

I supply guava directly to supermarket/processing industries

1.60a 0.60

I supply guava directly consumers 4.55c 0.51

My strong linkage with producer helps me to offer competitive price of guava to the consumers and

reduces marketing cost considerably

1.65a 0.59

My direct linkage with producers and chain partners provide good quality guava to consumers

1.70a 0.47

Relationship

I am committed for long term relationship with producer Government

agencies/NGOs/processer/supermarket/exporters

1.60a 0.50

I am committed for long term relationship with financial institutions

1.70a 0.57

I am committed for long term relationship with chain partners

4.50b 0.51


consumers 4.70

b 0.47

I have joint investments with producers/chain

partners/processor 1.60

a 0.50

Mutual respect prevails in the chain starting from the producer to consumer

3.75c 0.55

Contractual agreements are flexible and informal rather than rigid

2.60d 0.50



Variables

Respondent Likert

Score

Mean

Standard

devia

tion

Collaboration

I have agreement with bank to provide loan for my business

4.50a 0.51

I have agreement with producer to supply agricultural inputs timely for production of guava

1.50b 0.51

I and producer/government agencies/NGO’s exchange relevant and accurate information related to

production process and marketing of guava

1.70b 0.47

I and producer/government agencies/NGO’s jointly

conduct the promotional events and search potential

markets for gauva

1.55b 0.51

I and producer/chain partners share risk and benefits associated with the production and marketing of

guava

1.65b 0.58

I and producer/chain partners share the knowledge and information regarding the forecast of supply &

demand and new technologies in production and

marketing of guava

2.15c 0.58


The financial institutions have commitment with me

to provide financial assistance timely in order to purchase guava

3.95a 0.60

Government agencies / NGO’s have commitment with me to update national and international laws &

regulations related to production and marketing of

guava

1.55bc

0.51

Wholesalers have commitment with me to provide appropriate and economic logistics for the timely

delivery of guava to consumer

1.65bc

0.59

I have commitment with producer for joint venture /contract farming for production and marketing of

guava

2.00c 0.65

I and supply chain partners have commitments for

open communication in marketing of guava 3.65

a 0.49

I have agreement to purchase guava from producer at actual wholesaler price

1.80bc

0.52

Cutting edge technology

I am using the advanced transportation and storage

system for fresh guava 4.50

a 0.51

Govt. agencies / NGO’s provide the training for

advanced technologies related to marketing of fresh

guava

1.65b 0.49



Variables

Respondent Likert

Score

Mean

Standard

devia

tion

I am using the advanced packaging technologies for

fresh guava as it reduces the losses during

transportation and storage

4.30a 0.66

I am using information and communication

technology for marketing of fresh guava as it reduces

the time and cost of marketing

4.60a 0.50

I am using the advanced technologies for marketing in order to increase the quality and safety of fresh

guava

4.55a 0.51

I am using information and communication technology in order to understand consumer needs

and preferences for fresh guava

4.30a 0.47

Consumer insights

I am aware about the consumer preferences regarding production process of the guava

4.15a 0.67

I am aware about the recommended rate of fertilizers, insecticides, herbicides and growth promoters in

production process of guava in order to minimize

health risk of consumers

3.60b 0.50

I am following national and international laws & regulations for marketing and storage of guava in

order to minimize health risk of consumers

4.25a 0.72

I am following the appropriate storage and packaging

techniques transportation and maintaining the

nutritive value, appearance and taste of guava

4.45c 0.60

I coordinate with various stakeholders of the supply

chain of guava for overall satisfaction of the

consumers

4.35c 0.59

I always try provide competitive price to consumers for guava

4.40c 0.50


difference (p < 0.05).

The variables which are weak in the current value chain of guava in context of

retailers’ perspective include food processing industry, export market, transparency,

linkage, relationship, collaboration and commitment and trust. The above mentioned

variables which have low significance / weak are important components of value

chain of guava.

Therefore, improving the status of above mentioned variables may improve the

existing value chain of fresh guava in Kaushambi district considerably as well as

provide high quality and guavas at a safe and competitive price to consumers (Kongt,

1988, Esty, 2004; Park et al., 2004; Mol, 2006 and Zhao et al., 2007).



3.3. Consumer Perspectives

The analysis in context to market infrastructure revealed that consumers are satisfied

with the availability of supermarkets, retail markets, local markets and street vendors

for purchasing guava and guava products. The consumer’s feedback on market

infrastructure revealed that good road connectivity to different markets as well as

public transport facilities are available. The analysis further revealed that consumers

are fully satisfied with availability of wide variety of fresh produce, promotional

offers and atmosphere at the market place. However, cooperative markets are not

available in the district. The consumers’ feedback in context of information and

material flow revealed that information on production process, application of

fertilizers, pesticides, insecticides and herbicides as well as information on quality,

safety and nutritive attributes of guava is not available to consumers. However,

information on price, promotional offers and shelf-life of guava and guava products is

readily available to consumers. The analysis revealed that consumers are fully

satisfied with supply and availability of fresh and processed guava products in the

market (Table 3).

The consumers’ feedback on transparency revealed that production process

including the application of fertilizers and chemicals, quality, safety and nutritive

value of guava and guava products are not transparent. The analysis further revealed

that processing techniques including the use of chemicals, colour and preservatives

and packaging quality are not transparent. However, price and shelf life of fresh

guava and guava products are highly transparent. The linkage / relationship between

consumers and producers, wholesalers and food processing industries is weak in the

current value chain of guava. However, consumers and retailers, as well as consumers

and supermarkets have strong direct linkage and relationship. This is due to the fact

that majority of retailers and supermarket officials conduct market surveys regarding

consumers’ needs and preferences in relation to price, quality, safety, packaging and

sensory attributes of fresh and processed guava products (Table 3).

The consumer feedback on commitment and trust revealed that retailers and

supermarkets have strong commitment to provide high quality and competitive price

to consumers for guava and guava products. The consumers have trust on retailers and

supermarkets to provide high quality, safe, nutritive and competitive pricing for

guava. However, producer and food processing industry have no commitment with

consumers to use appropriate technology for production, storage, transportation,

processing and packaging of guava and guava products. The analysis on consumers’

perception regarding the quality attributes of fresh and processed guava products

revealed that the most important determinants for purchasing fresh and processed

guava products are freshness / taste, followed by colour, nutritive value, appearance,

product information on packaging and texture. Further, the analysis revealed that

consumers gave least preference to aroma, packaging and brand name (Table 3).

The analysis on consumers’ perception regarding the safety attributes revealed

that guava and guava products should be free of pesticides, insecticides and

hormones. The analysis revealed that packaging was an important determinant for purchasing fresh and processed guava products. Consumers gave least importance to

the place of origin, way of production, environmental sustainability and storage while

purchasing fresh and processed guava products. The consumers perception regarding

the service rendered by supplier revealed that price, followed by behaviour of

supplier, promotion / discount, consumer attention, consumer support, store

atmosphere, brand availability, presentation and convenient packaging are important



determinants to purchase fresh guava and processed guava products. The analysis

further revealed that consumers gave least importance / preference to credit facilities,

store timing, transaction time and recreation facilities. The overall results revealed

that amongst the determinants related to service rendered by supplier, the price of

fresh guava / processed guava products is the most important factor influencing the

purchasing decision of consumers (Table 3).

Table 3 Value chain analysis of guava on consumer perspective, Kaushambi district, India

(Likert Scale: Strongly disagree = 1, disagree = 2, don’t know = 3, agree = 4, strongly agree

= 5)

Variables

Respondent Likert

Score

Mean

Standard

devia

tion


Availability of supermarket 3.90ad

0.64

Availability of retail market 4.70b 0.47

Availability of cooperative market 1.50c 0.51

Availability of Local market 4.45b 0.51

Availability of street vender 4.60b 0.50

Good road connectivity to market 4.05ad

0.51

Availability of public transport to market 4.00ad

0.65

Availability of parking facilities at the market 2.75e 0.85

Availability of credit facilities at the market 1.55c 0.60

Availability of wide variety of fresh produce at the market

4.40bd

0.50

Promotional offers at the market 3.95ad

0.60

Atmosphere at the market 3.80ad

0.70

Information and material flow

Information on production process 1.55a 0.51

Information on fertilizers, pesticides, insecticides, herbicide and growth regulator

1.50a 0.51

Information on quality, safety and nutritive value 1.80a 0.62

Information on price 4.05b 0.51

Information on discount and promotional offers 4.10b 0.55

Information on shelf –life 4.10b 0.45

Regular supply to the market 4.45b 0.51

Availability of adequate quantity at the market 4.15b 0.67



Variables

Respondent Likert

Score

Mean

Standard

devia

tion

Transparency

Transparency in production process of guava 1.70a 0.57

Transparency in quality 2.35b 0.67

Transparency in safety 1.70a 0.66

Transparency in nutritive value of guava 2.15b 0.67

Transparency in price 4.00c 0.56

Transparency in processing technique 2.05ab

0.60

Transparency in packaging technology 2.00ab

0.73

Transparency in shelf life 3.65c 1.04

Linkage

Linkage between consumer and producer 1.75a 0.55

Linkage between consumer and wholesaler 1.75a 0.55

Linkage between consumer and retailer 4.55c 0.51

Linkage between consumer and processing industry 1.60a 0.50

Linkage between consumer and supermarket 4.30c 0.47

Relationship

Relationship between consumer and producer 1.70a 0.47

Relationship between consumer and wholesaler 1.75a 0.44

Relationship between consumer and retailer 4.40b 0.50

Relationship between consumer and processing industry

1.50a 0.51

Relationship between consumer and supermarket 4.30b 0.57


Commitment to provide high quality guava and guava products

3.60a 0.75

Commitment to provide safe guava and guava

products 3.50

a 0.69

Commitment to provide competitive price for guava

and guava products 3.45

b 0.69

Commitment to supply guava and guava products regularly

4.15c 0.59

Commitment to use appropriate and advanced technology for production, processing, transportation,

storage and packaging

1.85d 0.67



Variables

Respondent Likert

Score

Mean

Standard

devia

tion

Consumer have trust on retailer and supermarket in

relation to quality, safety, nutritive value and price of

guava and guava products

3.95a 0.83

Consumer perception on quality of fresh guava /

processed guava products

Freshness 4.75a 0.44

Texture 3.40b 0.68

Appearance 4.10c 0.85

Taste 4.75a 0.44

Color 4.40ac

0.50

Aroma 2.55d 0.69

Nutritional value 4.40ac

0.50

Packaging 2.35d 0.67

Brand name 2.55d 0.69

Product information on packaging 3.85c 0.67

Consumer perception on safety of fresh

guava/processed guava products

Place of origin 2.05a 0.76

Way of production 2.20a 0.62

Free of hormones 4.65b 0.49

Free of insecticides 4.65b 0.49

Free of pesticides 4.70b 0.47

Environmentally sustainable 1.90a 0.64

Packaging 3.40c 0.73

Storage 2.50a 0.61

Consumer perception on services rendered by supplier

of fresh guava / processed guava products

Price 4.75a 0.44

Presentation 3.40b 0.60

Promotions / discount 4.25cf

0.64

Credit 2.60d 0.60

Behavior 4.45cf

0.51

Consumer support 3.85ef

0.49



Variables

Respondent Likert

Score

Mean

Standard

devia

tion

Store timing 2.85d 0.67

Transaction time 2.65d 0.67

Consumer attention 4.15cf

0.49

Store atmosphere 3.80ef

0.62

Recreation 2.45d 0.60

Convenient packaging 3.25b 0.79

Brand availability 3.60be

0.75


difference (p < 0.05)

The overall analysis on consumer feedback revealed that market infrastructure,

information flow, material flow, linkage, commitment and trust are strong

components in the existing value chain of guava in Kaushambi / Allahabad District.

The analysis further revealed that transparency and relationship between consumers

and chain partners are weak in the existing value chain of guava. The analysis on

consumer perception revealed that consumer gives more emphasis / importance to

quality, nutritive value, safety, price and availability for purchasing fresh guava /

processed guava products in Kaushambi / Allahabad district (Table 3). Furthermore,

chain partners should evolve strategies to satisfy the consumers in terms of

transparency, relationship, linkage, commitment, trust, quality, safety, packaging,

price, services / convenience, etc. (Kongt, 1988, Esty, 2004; Park et al., 2004; Mol,

2006, Zhao et al., 200; Marugavel, 2010; Ariyawardana et al., 2012 and Hena and

Peeyush, 2014).

CONCLUSION

In order to accomplish the objectives of the present study, a comprehensive survey

was conducted during October, 2014 – February, 2015 in Kaushambhi district, India

to perform the value chain analysis to develop a sustainable value chain management

system for guava. The following conclusions are drawn from the present study.

The value chain analysis of guava on producers perspective revealed that

procurement and application of agricultural inputs, availability and adaptation of

technology, marketing infrastructure, material and information flow, linkage, cutting

edge technology and consumer insight are strong and efficient, whereas transparency,

collaboration, commitment and trust between producer, chain partner and government

agencies are weak / unsatisfactory.

The value chain analysis of guava on retailers’ perspective revealed that market

infrastructure, transportation services, material flow, information flow, cutting edge

technology, consumer insights, etc., are strong and efficient. However, food

processing industries, export market, transparency, linkage, etc. are not satisfactory in

the current value chain of guava.

The value chain analysis for guava in context of on consumers’ perspective /

feedback revealed that market infrastructure, information flow, materials flow,



linkage, commitment and trust in existing value chain of guava are satisfactory.

However, transparency and relationship in existing value chain of guava are weak /

unsatisfactory. The consumer gives more emphasis / importance to quality, nutritive

value, safety and price as compared with packaging and service rendered for

purchasing fresh / processed guava products.

Finally, it may be concluded that variables which are weak in the existing value

chain of guava in Kaushambi district, India should be improved which shall result in

higher return to producer / farmer, improve quality and safety, improve risk sharing

among the chain partners, as well as improve overall efficiency and sustainability.

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