Assessing smallholders’ heterogeneity towards sustainable agrifood value chain in developing countries

Abstract

PurposeAgrifood value chains in developing countries are transforming into higher value markets which require sustainable practices, with smallholders playing a critical role. However, smallholders are a heterogeneous group which may have discrepancies in outcomes to meet sustainability standards. This paper aims to empirically investigate smallholders' heterogeneity towards sustainable value chain practice in developing countries.Design/methodology/approachEight key enabling factors of sustainable value chain transformation were used to explore smallholders' typology, then profiled, based on their socio-economic status and current practices. A quantitative method was applied in Indonesia's cashew sector with 159 respondents from the primary producer area on Madura Island. A combination of descriptive analysis, cluster analysis, cross-tab analysis and one-way ANOVA analysis was used in this study.FindingsFour types of groups were identified, each with distinct characteristics and arranged in priority order as follows: accelerator, progressor, inattentive and conservative groups. Interventions can be implemented on per clusters basis or based on potential similarities among clusters, depending on priority. It is noted that the pursuit of sustainable value chain practices by smallholders is not necessarily associated with high socio-economic status, as those with low socio-economic status may have a stronger inclination towards them.Practical implicationsThe paper enhances awareness of practitioners and policymakers regarding smallholders' heterogeneity in sustainable value chain practice. It enables more effective and focused interventions to support smallholders who require assistance in sustainable production and value-adding activities. Different smallholders' characteristics call for different assistance/intervention. Practitioners can recognise smallholders' characteristics that are more compatible with higher value markets and sustainability requirements to better integrate their practices. Policymakers must carefully develop short-term and long-term interventions based on the activities prioritised by particular traits to “hit the right button” for smallholders' practice development.Originality/valueThis study investigates the typology of smallholders towards sustainable value chain practices by using eight enabling factors and profiling them based on their socio-economic condition and current practices. Additionally, this study shifts the focus of typology exploration away from the traditional lens of farm sustainability to a larger perspective which encompasses sustainable value chain activities.