The Influence of Capacity Building on Small-Scale Agro-Processors in South Africa: Lessons for Agricultural Extension Advisory Services

B. Manasoe; V.M. Mmbengwa; J.N. Lekunze

doi:10.17159/2413-3221/2024/v52n3a15543

Authors

B. Manasoe Tshwane University of Technology https://orcid.org/0000-0001-6529-9603
V.M. Mmbengwa University of Limpopo https://orcid.org/0000-0002-7618-9925
J.N. Lekunze North-West University

DOI:

https://doi.org/10.17159/2413-3221/2024/v52n3a15543

Keywords:

Capacity Building, Human Capital Theory, Small-Scale Agro-Processors, Agricultural Extension Advisory Services

Abstract

This paper examines capacity building from the perspective of business growth and success in small-scale agro-processing enterprises. Our analytical approach was underpinned by the inability of small-scale agri-enterprises to grow and succeed despite the South African government's support for capacity building through the economic empowerment programme initiative in the past three decades. The study was conducted in five of nine selected South African provinces (Gauteng, Limpopo, North-West, Free State, and Mpumalanga). This study was essential for developing an effective strategy for enhancing agri-business growth and success in South Africa. A concurrent mixed-methods research design was used, and data from 503 small-scale agro-processors was analysed using descriptive and multiple regression analysis techniques. The results revealed that capacity building (β = 0.274, p = 0.000) significantly influences the economic empowerment of small-scale agro-processors. Furthermore, the study showed that mentorship and technical and financial skills are critical types of capacity building that influence the economic empowerment of small-scale agro-processors in South Africa. It is recommended that all government or private stakeholders, including agricultural extension advisory services, invest in capacity-building programmes for small-scale agro-processors to achieve economic empowerment. Economically empowered small-scale agro-processors will significantly contribute to employment creation and better income distribution.

Downloads

Download data is not yet available.

References

ABDULAI, A.R., BAHADUR, K. & FRASER, E., 2022. What factors influence the likelihood of rural farmer participation in digital agricultural services? Experience from smallholder sdigitalisation in Northern Ghana. Outlook Agr., 52(1): 57-66.

ADOM, D., 2019. The place and voice of local people, culture and traditions: A catalyst for ecotourism development in rural communities in Ghana. Scientific African., 6: e00184.

AHMAD, I. & AHMAD, S., 2018. Multiple skills and medium enterprises' performance in Punjab Pakistan: A pilot study. Soc. Sci. Res., (4): 44-49.

AKPAN, I.J., UDOH, E.A.P. & ADEBISI, B., 2022. Small business awareness and adoption of state-of-the-art technologies in emerging and developing markets, and lessons from the COVID-19 pandemic. J. Small Bus. Entrep., 34(2): 123-140.

AKPAN, S.B., OFFOR, O.S. & ARCHIBONG, O.E., 2020. Access and demand for credit among small-scale agro-based processors in Uyo agricultural zone, Akwa Ibom State, Nigeria. Niger. Agric. J., 51(1): 132-141.

ALADEJEBI, O., 2018. The impact of the human capacity building on small and medium enterprises in Lagos, Nigeria. J. Bus. Entrep. Dev., 6(2): 15-27.

ALI, F., CIFTCI, O., NANU, L., COBANOGLU, C. & RYU, K., 2021. Response rates in hospitality research: An overview of current practice and suggestions for future research. Cornell Hosp. Q., 62(1): 105-120.

ALI, A.E.M., HAMAD, M.A.A., ABDALLH, M.A.A. & ELAGAB, M.A.M., 2020. The role of extension officers in delivering agricultural services to the small-scale farmers, Gezira State, Sudan. Am. Int. J. Agric. Stud., 3(1): 51-65.

ALIU, J. & AIGBAVBOA, C., 2019. Examining the roles of human capital theory. What next for the Construction Industry? J. Phys. Conf. Ser., 1378(2): 022057.

ALMAHRY, F.F., SAREA, A.M. & HAMDAN, A.M., 2018. A review paper on entrepreneurship and entrepreneurs' skills. J. Entrep. Educ., 21(2S): 1-7.

AMPADU-AMEYAW, R. & OMARI, R., 2015. Small-scale rural agro-processing enterprises in Ghana: Status, challenges and livelihood opportunities of women. J. Sci. Res. Reports., 6(1): 61-72.

BANJI, O.O. & SAMPATH, P.G., 2007. Innovation in African Development. Case Studies of Uganda, Tanzania, and Kenya. New York: The World Bank.

BHARATI, A.K., RAY, A., KHANDELWALA, M., RAI, R. AND JAISWAL, A., 2021. Stability evaluation of dumb side using artificial neural network and multiple regression. Eng. Comput., 1(9). https://doi.org.10.1007/s00366-021-01358-y

BITTAR, O.J., RAPHAEL, N.O. & RAWAGO-ODOYO, A., 2022. Impact of training in manufacturing skills on the growth of smallholder agro-processing industry in Bureti Sub-county, Kericho County, Kenya. In Proceedings of the Sustainable Research and Innovation Conference, 6 - 8 May, pp. 273-280.

BJURSELL, C. & SADBOM, R.F., 2018. Mentorship programs in the manufacturing industry. Eur. J. Train. Dev., 42(7/8): 455-469.

CDS., 2007. Settlement Implement Support Strategy (SIS) for Land and Agrarian Reform in South Africa.

CHEERS, B., COCK, G., KEELE, L.H., KRUGES, M. & TRIGG, H., 2005. Measuring Community Capacity: An Audit Tool. 2nd Future of Australia's Country Town Conference, 11 – 13 July, Bendigo.

CHICHAYBELU, M., GIRMA, N., FIKRE, A., GEMECHU, B., MEKURIAW, T., GELETA, T. & OJIEWO, C.O., 2021. Enhancing chickpea production and productivity through 'stakeholders' innovation platform approach in Ethiopia. In E. Akpo, C.O. Ojiewo, I. Kapran, L.O. Omoigui, A. Diama & R.K. Varshney (eds.), Enhancing Smallholder Farmers' Access to Seed of Improved Legume Varieties Through Multi-Stakeholder Platforms. Singapore: Springer, pp. 97-111.

CHIKAIRE, J.U., AJAERO, J.O. & ATOMA, C.A., 2022. Socioeconomic effects of COVID-19 pandemic on rural farm families' well-being and food systems in Imo State, Nigeria. J. Sustain. Environ. Manage., 1(1): 18-21.

DAHLSTROM, T.R. & TALMAGE, C.A., 2018. Entrepreneurial skills for suitable small business: An exploratory study of SCORE, with comparison. Community Develop., 49(4): 450-468.

DANINGA, P.D., 2020. sCapitalising on agro-processing in Tanzania through Sino-African co-operation. JCBS., 5(1): 60-72.

DEPARTMENT OF AGRICULTURE, FORESTRY AND FISHIRIES., 2016. National Policy Framework on the support and development of small and medium Agro-Processing Enterprises in the Republic of South Africa. South Africa: Pretoria.

FIX, B., 2018. The trouble with human capital theory (No. 2018/07). Working Papers on Capital as Power.

FLORA, C., KINSLEY, M., LUTHER, V., WALL, M., ODELL, S., RATNER, S. & TOPOSKY, J., 1999. Measuring community success and sustainability: An interactive workbook. Iowa State University Press.

GEBREHIWET, Y., 2012. Economic profile of the agro-processing industry in South Africa: 1970-2010. Pretoria: DAFF.

GILLER, K.E., 2020. The food security conundrum of sub-Saharan Africa. Glob Food Secur., 26: p.100431.

GITHINJI, A.M., 2017. Factors influencing innovative value creation of milled rice by Agro processors within the rice value chain in Mwea Irrigation Scheme. Doctoral dissertation. University of Nairobi.

GOOGLE MAPS., 2019. Map of the Republic of South Africa. Available from: https://www.google.com/search?q=Map+of+south+africa&rlz=1C1GCEU_enZA822ZA822&oq=Map+of+south+africa&aqs=chrome..69i57.13553j0j15&sourceid=chrome&ie=UTF-8.

GUMBOCHUMA, J., 2017. The status and impact of technology transfer and innovation on the productivity and competitiveness of small-scale agro-processing businesses in Mashonaland Central (Zimbabwe) and Free State (South Africa). Doctoral dissertation. Free State: Central University of Technology.

HLATSHWAYO, S.I., NGIDI, M., OJO, T., MODI, A.T., MABHAUDHI, T. & SLOTOW, R., 2021. A typology of the level of market participation among smallholder farmers in South Africa: Limpopo and Mpumalanga Provinces. Sustainability., 13(14): 7699.

HUSSAIN, J., SALIA, S. & KARIM, A., 2018. Is knowledge that powerful? Financial literacy and access to finance: An analysis of enterprises in the UK. J. Small Bus. Enterp., 25(6): 985-1003.

KENA, D., GOLICHA, D., JEMAL, E., KANU, B. & GAYO, G., 2022. Smallholder dairy producers' participation in dairy marketing in Southern Omo Zone, Ethiopia. Pastoralism., 12(48): 1-13.

KHOZA, T.M., SENYOLO, G.M., MMBENGWA, V.M., SOUNDY, P. & SINNETT, D., 2019. Socioeconomic factors influencing smallholder farmers' decision to participate in the agro-processing industry in Gauteng province, South Africa. Cogent Soc. Sci., 5(1): 1664193.

KING, K. & MCGRATH, S., 2002. Globalization, enterprise, and knowledge: Education, training, and development in Africa. Kluwer Academic Publishers.

KURATKO, D.F., NEUBERT, E. & MARVELL, M.R., 2021. Insights on the mentorship and coaching of entrepreneurs. Bus. Horizons., 64(2): 199-209.

KUWORNU, J.K. & DUMAYIRI, M., 2014. Farm household's livelihood diversification into agro-processing and non-agro-processing: Empirical evidence from Ghana. Inf. Manag. Busi. Review., 6(4): 191-199.

LOIRUCK, D., 2013. Capacity building to farmers for smaximising agricultural output; a case study of Elakunoto Group at Mlangarini Ward in Arumeru District. Doctoral dissertation. The Open University of Tanzania.

MADU, U.A., 2019. Analysis of the effect of capacity building of the Fadama II project on benefiting rural communities in Adamawa State, Nigeria.

MAHASHA, P.P., HLOGWANE, J.J. & GIDI, L.S., 2022. Gender analysis of access to formal credit by small-scale farmers in Greater Letaba Municipality, South Africa. J. Agribus. Rural Dev., 1(63): 5-13.

MANASOE, B., MMBENGWA, V.M. & LEKUNZE, J.N., 2022. Evaluating domains associated with economic empowerment of small-scale female agro-processors in South Africa. J. Agribus. Rural Dev., 1(64): 125 - 140.

MANASOE, B., MMBENGWA, V.M. & LEKUNZE, J.N., 2021a. Analysis of the impact of the networks on the status of the internal resources of the small-scale agro-processors in South Africa. Cogent Soc. Sci., 7(1): 1964201.

MANASOE, B., MMBENGWA, V.M. & LEKUNZE, J.N., 2021b. Expansion strategies in the agro-processing sector for small-scale agro-processors in South Africa. Paper presented at the International Business Conference, 20 – 21 September 2021. Available from: http://hdl.handle.net/10394/40249.

MANGUBHAI, S. & LAWLESS, S., 2021. Exploring gender inclusion in small-scale fisheries management and development in Melanesia. Marine Policy., 123: 104287.

MARGINSON, S., 2019. Limitations of human capital theory. High. Educ. Stud., 44(2): 287-301.

MARSHALL, A., 1965. Principles of economics. London: Macmillan.

MAZIBUKO, N.E., SMITH, E.E. & TSHUMA, E., 2018. Management perceptions regarding the factors impacting sprivatisation of parastatals in a developing country. S. Afr. J. Econ. Manag. Sci., 21(1): 1-12.

MAZUNGUNYE, P.P., 2020. Industrialisation for economic transformation: Economy-wide impacts of agro-processing development in Tanzania. Doctoral dissertation. Stellenbosch University.

MCKENZIE, D., 2021. Small business training to improve management practices in developing countries: Re-assessing the evidence for "training doesn't work". Oxf. Rev. Econ. Policy., 37(2): 276-301.

MKUKI, Z.H. & MSUYA, C.P., 2020. Agricultural extension officers' perceptions towards their roles: a case study of Simiyu Region. Tanzania J. Agric. Sci., 19(2): 56-66.

MKUNA, E., NALAILA, S. & ISAGA, N., 2021. Extent and determinants of women participation in agro-processing small and medium enterprises (SMEs) in Dar es Salaam – Tanzania.

MMBENGWA, V.M., 2009. Capacity-building strategies for sustainable farming S.M.M.E.s in South Africa. Doctoral dissertation. University of the Free State, Bloemfontein.

MMBENGWA, V.M., RAMBAU, K. & QIN, X., 2020. Key factors for the improvement of smallholder farmers' participation in agro-processing industries of Gauteng province of the Republic of South Africa: Lessons for the extension advisory services. S. Afr. J. Agric. Ext., 48(2): 153-165.

MOHAMED, Y. & MNGUU, Y.O., 2014. Fiscal and monetary policies: Challenges for small and medium enterprises (S.M.E.s) development in Tanzania. Int. J. Soc. Sci. Entrep., 1(10): 305-320.

MONDAL, H., SWAIN, S.M. & MONDAL, S., 2022. How to conduct descriptive statistics online: A brief hands-on guide for biomedical researchers. Indian J. Vasc. Endovasc. Surg., 9(1): 52-62.

MORRIS, K.J., KAMARULZAMAN, N.H. & MORRIS, K.I., 2019. Small-scale postharvest practices among plantain farmers and traders: A potential for reducing losses in Rivers state, Nigeria. Scientific African., 4(e00086): 1 – 10.

MTHOMBENI, D.L., ANTWI, M.A. & RUBHARA, T., 2021. Level of participation of small-scale crop farmers in agro-processing in Gauteng Province of South Africa. Afr. J. Food Agric. Nutr. Dev., 21(1).

MTHOMBENI, D.L., ANTWI, M.A. & ODUNIYI, O.S., 2022. Factors influencing access to agro-processing training for small-scale crop farmers in Gauteng province of South Africa. Agric. Food Sec., 11(1): 1-7.

MUCHAU, R.N., 2013. The effect of a mentorship program on business performance amongst Micro, Small, and Medium Enterprises (MSME) in Nairobi County. Masters thesis. University of Nairobi.

MUNYIGI, S.G., IRAVO, M.A., ROTICH, G. & MAKORI, M., 2024. Role of civil society capacity building on performance of devolved units in selected county governments in Kenya. Int. J. Bus. Manag., 5(1): 106-114.

MURRAY, C., 1997. South African land reform: Case studies in 'demand' and 'participation' in the Free State. African Affairs., 96: 187–214.

NAMASIVAYAM, K. & DENIZCI, B., 2006. Human capital in service organisations: identifying value drivers. J. Intellect. Cap., 7(3): 381-393.

NYAME, I. & CAESAR, L.D., 2022. Understanding what informs the choice of agro-processing firm siting: Evidence from a developing country. Int. J. Rural Manag., 19(2): 189-213.

ÖKTEN, Z., CHURCHMAN, L.S., ROCK, R.S. & SPUDICH, J.A., 2004. Myosin VI walks hand-over-hand along actin. Nat. Struct. Mol. Biol., 11(9): 884-887.

OLANIYAN, D.A. & OKEMAKINDE, T., 2008. Human capital theory: Implications for educational development. Pak. J. Soc. Sci., 5: 479-483.

OWOO, N.S. & LAMBON-QUAYEFIO, M.P., 2017. The agro-processing industry and its potential for structural transformation of the Ghanaian economy (No. 2017/9). WIDER Working Paper.

OWOO, N.S. & LAMBON-QUAYEFIO, M.P., 2018. The agro-processing industry and its potential for structural transformation of the Ghanaian economy. Oxford Academic.

PRATAMA, S.D. & RAHADIANA, R., 2019. The evaluation of Indonesian labor market in soptimising demographic dividend in 2016. JKAP., 22(2): 84-97.

PSACHAROPOULOS, G. & WOODHALL, M., 1987. Education for development: An analysis of investment choices. New York: Oxford University Press.

QUARTEY, E.T. & DARKWAH, S., 2015. Factors affecting the use of modern technologies in agro-processing in Ghana. Academia J. Agric. Res., 3(7): 99-115.

RAHMAN, A.A., MARDININGSIH, D. & DALMIYATUN, T., 2018. The influence of the role of agricultural extension officers on the knowledge level of robusta coffee farmers about the farm card program in Jumo District Temanggung Regency. Agroland: The Agr. Sci. J., 5(1): 23-31.

RAMBE, P. & AGBOTAME, L.A., 2018. Influence of foreign alliances on small-scale agricultural businesses' performance in South Africa: A new institutional economics perspective. S. Afr. J. Econ. Manag. Sci., 21(1): 1-14.

SASIDHARAN, S., SOWMIYA, R. & BALAKRISHNARAJA, R., 2014. Biosynthesis of selenium nanoparticles using citrus reticulata peel extract. World. J. Pharm. Res., 4: 1322–1330.

SCHULTZ, T.W., 1971. Investment in human capital. New York Press.

SENIK, G., 1995. Small-scale food processing enterprises in Malaysia. Food and Fertilizer Center.

SETSOAFIA, E.D., ABOAH, J. & GIDEON, D.A., 2015. Growth and constraint analysis of micro and small-scale agro enterprises in Accra, Ghana. Int. J. Economics Commerce Manag., 3(3).

SHITU, G.A., SAKIA, R., METI, S.K. & MARADDI, G.N., 2013. Market-led extension: prospects and challenges for agricultural sustainability in the 21st Century (No. 138-2016-1990).

SMITH, A., 1910. The wealth of nations. London: Dent and Dutton.

STATS SA., 2019. Mid-year population estimates: 2019. (Statistical release P0302).

SWAI, M.I., 2017. Factors affecting the growth of small and medium agro-processing firms in Tanzania: a case of sunflower oil processors in Dodoma. Doctoral dissertation. The University of Dodoma.

TAKEMURA, K., UCHIDA, Y. & YOSHIKAWA, S., 2014. Roles of extension officers to promote social capital in Japanese agricultural communities. PLoS One., 9(3): p.e91975.

TEYMEN, A. & MENGIC, E.C., 2020. Comparative evaluation of different statistical tools for the prediction of uniaxial compressive strength rocks. Int. J. Min. Sci. Tech, 30: 785

THINDISA, M.V. & URBAN, B., 2022. The competitiveness of agribusinesses in South Africa about entrepreneurship and compliance with standards. J. Agribus. Rural Dev., 66(4): 311-319.

THWALA, W.D. & PHALADI, M.J., 2009. An exploratory study of problems facing small contractors in the North West province of South Africa. Afr. J. Bus. Manag., 3(10): 533-539.

UMAR, A., SASONGKO, A.H. & AGUZMAN, G., 2018. Business model canvass as a solution for the competing strategy of small businesses in Indonesia. Int. J. Entrep., 22(1): 1-9.

WILLIAMS, P.A., AKUFFOBEA, M., ONUMAH, J.A. & ESSEGBEY, G.O., 2016. Meeting productive capacity of agro-processors in Ghana: What are the drivers? Int. J. Dev. Sustain., 5(10): 495-507.

WORLD BANK., 2007. Cultivating Knowledge and Skills to Grow African Agriculture. A synthesis of institutional, regional, and international review. Agriculture and Rural Development Department.

ZEITHMAL, V.A., BERRY, L.L. & PARASURAMAN, B.A., 1996. The behavioural consequences of service quality. J. Mark., 60: 31–46.