Analysis of profitability of gum Arabic marketing in Yobe state, Nigeria

Abstract

This study analyzed the profitability of marketing gum Arabic (Senegalia senegal) in Yobe State, Nigeria. Specifically, it assessed the socioeconomic characteristics of the marketers, socioeconomic factors affecting the profitability of gum Arabic marketing as well as the profitability of its marketing in the State. Purposive sampling technique was used in selecting Afunori, Nangere and Damaturu plantation areas established in 1999. From a population of 27 gum Arabic marketers, 25 respondents were selected based on Yero Yemeni`s model of sample size determination. Primary data were collected using structured questionnaire. The information collected included socioeconomic characteristics of respondents, as well as marketing costs and revenues. A combination of statistical and financial/economic tools were used in analyzing the data including percentages, means, regression as well as Gross Margin (GM) and Profitability analyses. Socioeconomic results revealed that the gum Arabic marketing scenario was dominated by male married youths whose mean age was 38.20 years, predominantly literate public servants with an average marketing experience of 10.5 years. These social factors had significantly impacted on profitability of gum Arabic marketing in the study area. Cost elements on the contrary, had insignificant impact. Gum Arabic marketers generated ₦ 2, 601.92 GM/ton/marketer whereas net profit/ton stood at ₦ 65, 048.12. Thus, the net profit/ton/marketer generated was ₦ 2, 403.09. The study concluded that gum Arabic marketing was profitable in the study area.