Factors affecting profitability of agricultural produce enterprises in Gulu city
Abstract
Gulu city recognizes trade in agricultural produce as one of the key activities for income generation to the community and a source of revenue for the local government, several crops have been prioritized under the national development Programme and categorized in the second group in an attempt of the government reducing poverty in Acholi sub-region and this includes sesame, vegetable oil. Over the past decade, food commodities such as millet, cassava, sorghum, and simsim, among others were never regarded as commercial. However, urbanization in Uganda has led to increased demand for these foods. Subsequently, these commodities are now traded across the country including in the trading centers at the village level. This study was to assess the factors that influence the profitability of agro-produce enterprises in Gulu city. This was done by characterizing agro-produce traders, examining the factors influencing the profitability of agro-produce enterprises, and assessing the challenges faced by agro-produce enterprises in Gulu city. The study used primary data to collect data from 104 respondents. This study also employed a descriptive survey method and data was analyzed using descriptive statistics indicating frequencies, mean, and standard deviation a linear regression model was used to analyze factors influencing the profitability of agro produce enterprises and the result indicated that distance traveled to purchase produce amount of credit obtained and being married had a positive and significant effect on the profitability of agro produce enterprises. This study also found that the absence of a ready market for the produce and fluctuating prices for the produces were among the challenges faced by agro-produce enterprises. The study, therefore, recommends that the government has to reconstruct and develop roads leading to villages to ease accessibility of produce and the government and financial institutions should also open and extend more credit institutions to very many parts of the country to encourage more borrowing of credit to the agro produce enterprises