Financial performance and constraints in Gari Production in Kumasi, Ghana

Abstract

Gari is a crisp and crunchy West African food made from grated cassava with the excess liquid dried out. It is a major food security product  consumed by most households and students in second cycle institutions in West African. Gari production is an important source of livelihood for many women in the informal sector in Ghana. It serves as a vital avenue for value addition to cassava, thus helping to address the problem of post-harvest losses and generating income for producers. This study assessed the financial performance and constraints in gari production in Kumasi, Ghana. Primary data from a cross-sectional survey of 46 gari producers who were identified using snowball sampling technique was used. Descriptive statistics, profitability indicators, and a 5-point Likert scale were used to analyse the primary data. Results showed that gari production is
predominantly done by women 30-75 years old with a mean age of 50 years. Majority of producers had no formal education (57%) and had been in production for an average of 24 years. It was found that gari production in Kumasi is financially profitable, with all the profitability indicators employed showing positive returns on inputs employed in production, although the values were less competitive relative to other producers’ values
elsewhere. The profit margin was favourable at 22%, return on capital employed (ROCE) at 29% and operating expense ratio at 76%. The relatively low ROCE of 29% compared with the opportunity cost of capital (31%) by commercial banks in the study area indicates the underutilization of producers’ capital in gari production. Key constraints identified in the gari production business were seasonality and high cost of cassava. Adoption of cost-effective management strategies and release of all year round cassava varieties could help improve gari production and livelihoods of producers and other actors along the cassava value chain.

Key words: Cassava, Gari, Production, Profitability, Constraints, Women, Livelihood, Kumasi-Ghana