DAIRY ENTERPRISES DEVELOPMENT THROUGH COOPERATIVES: HOW IT WORKS IN ETHIOPIA? (Pages 01-19) by Dr. R. Dayanandan in THE INTERNATIONAL MANAGER / ISSN: 2348-9413 (Online); 2348-9405 (Print)

When people carry out their economic activities individually, benefits dissipate, costs accumulate and economic impact becomes insignificant. Ethiopia (Horn of Africa) is an agrarian economy and dairy development has enormous scope for its development and national prosperity. To consolidate the efforts of small dairy producers in processing, marketing and transporting on a large scale, establishment of cooperatives is crucial. However, though many such cooperatives are established, contribution of such cooperatives in smallholder dairy production and marketing in the study area is not known due to dearth of studies. Hence, this paper focuses on the role of cooperatives in development of dairy enterprises and to explore the factors that influence the farmers to join cooperatives so as to forward policy implications. A multi-stage stratified random sampling procedure was followed to select 68 cooperative member dairy farmers and 78 non member dairy farmers owning both hybrid and local breed animals in Shashemene town of Ethiopia. To arrive the sample size (146), Yemane formula was used. To address the specific objectives, primary data was collected from sample dairy farmers using semi-structured questionnaires through direct face to face interview. Collected data was analysed using SPSS (Version 20) for arriving meaningful results. In addition to the descriptive statistical tools such as mean, standard deviation and Chi-square test etc., logistic regression model was used to identify the factors influence the farmers to join cooperatives. The results indicate that cooperative have played a vital role in stimulating production, marketing and improving their wellbeing in the study area. There is no variation among respondents (cooperative members and non members) in terms of system of production and both of them are using the same type of feeding and milking system. Cooperative members were performing well in production of milk due to the better farm management learned through training from cooperative. Since the cooperative milk collection centers are closer to the farmers, they incur less transportation cost and they found the marketing channel more efficient than non members. Farmers’ attitude towards cooperatives is better since they are satisfied with the services provided by the cooperatives and all the members are willing to continue the membership. Logistic regression analysis results indicate that; age, sex, religion, market information, household size, herd size, farm inputs and training are the factors influence the farmers positively to join cooperative. Based on the findings, recommendations are forwarded. Keywords: Dairy Enterprises; Cooperatives; Development; Social Enterprises