AN EVALUATION OF SMALL – SCALE AGRIBUSINESSES AND HOUSEHOLD INCOME GENERATING ACTIVITIES IN VHEMBE DISTRICT OF LIMPOPO PROVINCE, SOUTH AFRICA

The main purpose of this study was to evaluate the ability of small scale agribusinesses and household income generating activities to create employment and generate income. A total of 50 agribusinesses comprising 33 primary production businesses and 17 agro-processing businesses were randomly selected for the study. For household income generating activities, a total of 85 households were selected where an agribusiness was located. The households were purposely selected using the snow-balling methodology. Closed and open-ended questionnaires were used to collect data on agribusinesses and household income generating activities from managers of agribusinesses and selected households. The results from the agribusiness survey revealed that primary production businesses were creating more employment opportunities compared to agro–processing. However, results of regression analysis showed that the mean gross margin was higher in agro-processing than in primary production. Results for household income generating activities showed no evidence of employment creation, except that, these activities were used to generate income and reduce household food insecurity. According to the results, a mean income of R873.15 per month was generated by these activities. Although the income was not adequate to support a mean number of 8 dependants in a household, the income was higher than the pension grant of R700 per month which rural people depend on. The main constraints facing both agribusinesses and household income generating activities were lack of working capital, management skills, and marketing constraints. Financial support and skills training were identified as necessary strategies to overcome these constraints and to improve the outcomes from agribusinesses and household income generating activities. The study findings revealed similarities and differences between agri-businesses and household income generating activities. The differences were in management style, capital invested, final product, income and employment generated. Policy makers need to realize these differences and formulate policies accordingly for success and sustainability of these two poverty reduction strategies.