Today: March 28, 2024

Is there a place for e-commerce in the agricultural value-chain?

In the face of the ongoing Covid-19 pandemic, the world faces a new challenge to continue doing business while limiting physical contact between people as much as possible.

Most countries have at one point or the other resorted to using local and international lockdown restrictions to curb the spread of the disease. During lockdown, access to physical stores is often limited, thus, businesses that traditionally sell their produce at physical markets and consumers who traditionally bought their goods at physical markets are often faced with a dilemma on how to link with each other.

Opportunities

This challenge creates an opportunity for e-commerce and digital platforms such as WhatsApp and Facebook to increasingly link consumers and businesses, bearing in mind that other consumers may already have been using these channels. This article explores how vegetable consumers in Zimbabwe responded to the lockdown challenges in terms of acquiring vegetable produce for household consumption, and the possible barriers and opportunities that e-commerce presents in this industry.

Fresh vegetable produce, such as potatoes, carrots, onions, covo, grape, and tomatoes, forms a significant proportion of the household consumption across Zimbabwe. In urban areas, households consume fresh vegetables almost daily.

However, most households do not grow enough vegetables at home to cater for everyday consumption, hence, they rely on fresh vegetable produce sold in the city to meet their daily needs.

In March 2020, the Government of Zimbabwe imposed its first 21-day nationwide lockdown in a series of lockdowns aimed at curbing the spread of Covid-19 in the country. The lockdown restricted travel for both businesses and individuals except those considered as essential services, imposed curfews, and it prohibited gatherings.  

Food markets were considered an essential service, so formal food markets were kept open, while informal agricultural trading markets, traders and activities, which were normally characterized by high volumes of traders were closed as they were considered a possible hotspot for Covid-19 transmissions. Food wholesale and retail shops were kept open but restaurants, braai spots and entertainment areas were closed.

Travelling into city  centres was restricted, with individuals only being permitted to travel within a five-kilometer radius of their places of residence, apart from acquiring essential services outside that radii. To enforce these restrictions, roadblocks manned by police and the army were erected across the city and residential areas.  Those getting into the City Centre were asked to prove the reasons for their travel using either work IDs or exemption letters.

The COVID-19 disruptions

The lockdown restrictions had a negative impact on the agricultural sector and value chain in many ways. Unprepared for the disruptions in the market, and right in middle of production and harvesting, agricultural producers were faced with a shrunken market.

The closure of informal markets and non-essential businesses such as restaurants, entertainment places meant that farmers had lost access to a large proportion of their usual market. Consequently, farmers risked making huge losses through large post-harvest losses and reduced income. Households, on the other hand, could no longer access their traditional city centre markets, and were left with the options to buy vegetables for local vendors located in residential areas, or from local retailers. Traditional vendors and retailers in residential areas, who often purchased smaller quantities of vegetables could not meet the increased demand and as a result, they often hiked their selling prices.

The limited access to affordable fresh vegetable products for households, coupled with the shrunken market for producers and the high unemployment rate due to closure of many businesses and government departments, forced producers to find innovative ways to reach their household consumer market directly and also led to the increase in middlemen buying produce from the farmgate and selling it directly to individual consumers.

Since, access into the City Centre was limited and with no informal physical markets opened, some would sell their produce from the roadside, but because movement of ordinary citizens was restricted, producers and farmers turned to social media platforms such as WhatsApp, Twitter and Facebook for the sale and purchase of vegetables, while also introducing delivery at the buyers’ doorsteps.

Digital purchasing

Digital purchasing came with various advantages including home deliveries, pre-agreed pricing, and delivery times. However, despite its multiple benefits, especially during Covid-19 lockdown restrictions and the pandemic itself, consumers still appear resistant to adopting e-commerce as a means of purchasing fresh vegetables for household consumption. It seems that during strict lockdowns, e-commerce vegetable purchasing gained a little momentum among household consumers, with digital platforms such as Facebook and WhatsApp being the most popular platforms.

However, most consumers still preferred to visit some sort of physical market, purchasing their vegetables from grocery stores, neighborhood vendors. Spot markets in neighborhoods, and along busy roads across the city, also gained popularity among consumers. Once lockdown restrictions eased and vegetable markets reopened, consumers returned to their traditional markets, preferring to visit vegetable markets in the city or purchase from informal traders or grocery stores across the city.

Physical vegetable markets are more attractive compared to e-commerce markets for many reasons. There are many vegetable markets across the city, including formal and informal traders and grocery stores, making physical markets readily accessible to consumers, and giving consumers a wide variety of sellers to choose from. In these physical markets, consumers have the option to select the product of their desired quality and quantity for themselves.

Should they not be satisfied with their usual market, they can choose to purchase from other markets. Also, they can also easily bargain prices in physical markets. For e-commerce and digital sellers on the other hand, consumers are purchasing a product that they cannot see physically, and being fairly new, e-commerce sellers often do not offer adequate information on the quality and quantities of their product, which consumers can rely on to make purchase decisions.

A question of trust

Oftentimes, consumers do not trust that e-commerce sellers will deliver the expected product qualities and quantities as advertised, or even failing to deliver the product at the expected time. This mistrust is often fueled by inadequate product information. Lastly, by using fixed prices, e-commerce sellers take away the customer’s power to bargain prices.

Bearing in mind that the use of e-commerce in the sale of fresh household vegetables is a fairly new phenomenon in the country, ecommerce sellers need to find ways to tap into the vegetable market.  To achieve this, building sustainable relationships with customers will be critical and this can be achieved in different ways.

E-commerce sellers could invest in providing a consistent supply and quality of products. Sellers could also invest in closing the information gap between themselves and their potential customers by providing more information on their produce, for instance sizes, freshness, vegetable varieties and even their source’s location if possible. Consumers trust can also be gained by a seller posting pictures of the actual produce rather than internet or filtered pictures when marketing. Although it may take some time to establish, branding could also be another potential solution, as it gives the consumer an idea of the nature of the product to expect.  To build customer relationships, sellers can also ask customers to give feedback and from the feedback, learn to improve their services.

E-commerce platforms offer many potential benefits to consumers purchasing vegetables for household consumption compared to traditional physical markets, especially in the face of challenges caused by the ongoing Covid19 pandemic. However, due to lack of trust and ready availability, these platforms are relatively unpopular with consumers. By implementing some measures such as sharing more information about products, branding, and setting standards, ecommerce sellers may find a way to penetrate the market.