Economic overview of the distribution channels used by Eastern European small farms for their agricultural products

Abstract

The role of small farms in agricultural production is particularly important for less developed economies, with a high share of agriculture in GDP and a lower level of national income. These economies have a high share of small-scale farms in the total number of registered farms, measured by the size of an agricultural holding. The paper thoroughly analyses the distribution channels of the agricultural products of Moldova (MDA), Romania (ROM), and Serbia (SRB). The data sources for this analysis are taken from the survey conducted on 1 608 small-scale farms in the above-mentioned countries in 2019. The aim of the paper is to develop a model that could enable the structured analysis of distribution channels. Analytical Hierarchy Process (AHP) method was used for efficient assessment and as a criterion for choosing the most appropriate distribution channel. The results of the analysis show that small-scale farms mostly place their products in green markets and processing plants and that the quality and the price of agricultural products are the dominant criteria for the selection of a channel. The results of the applied model indicate that the model is stable and that small-scale farms can choose the optimal distribution channel by using this study.