Analyzing Coffee Supply Chain: a study on Harrar Coffee, Ethiopia
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Date
2018-06-04
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Addis Ababa University
Abstract
This study examines coffee supply chain in Darolebu, West Harrerge, where plenty of supply of Harrar coffee type comes from. The study was principally designed for identifying and categorizing the Harrar coffee supply chain actors, their roles and relationships and measure internal efficiency level in the chain. This descriptive mixed survey study uses multi-stage sampling method to select 125 farmers, 13 collectors including primary collectors and cooperatives and 28 exporters. And both primary and secondary data collected using data collection instruments: questionnaire and interview analyzed using both quantitative and qualitative data analysis methods. The supply chain analysis of Harrar coffee is done by employing internal efficiency measures of inventory value, inventory turns, return on sales and cash to cash cycle time. Findings show that there is excess coffee left over in the supply chain 20%, which prove deficiency in efficiency; all the three Harrar coffee supply chain actors mention that it is the most quickly converted to cash commodity; the chain lacks efficiency 88% in return on sales and by cash- to- cash cycle time measurement, the chain actors waits a maximum of three month to collect their revenue from their final customers. Generally by the four internal efficiency measurements of supply chain performance, Harrar coffee supply chain signifies that there is insufficiency in efficiency. Challenges that are disturbing the chain while doing its business include lack of improved seed supply and lack of knowledge on modern coffee production in the production spot, poor quality coffee followed by low price offer for the suppliers and lack of well developed logistic providers, high logistics cost and low government concern to the sector at the export side; although being the country’s pride make coffee respected commodity. Generally findings suggest that government must give appropriate attention to the sector and all participant actors should work jointly for the betterment of the overall supply chain gain.
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Supply Chain, Harrar Coffee, Internal Efficiency