The impacts of food certificate adoption on e-commerce income among small online agri-food sellers
Journal of Agribusiness in Developing and Emerging Economies
ISSN: 2044-0839
Article publication date: 14 September 2023
Abstract
Purpose
This paper aims to assess the determinants of food certificate adoption and analyse the impacts of food certificates on e-commerce income among small online agri-food sellers in Indonesia.
Design/methodology/approach
The authors used data from an online survey of 228 small-online agri-food sellers in East Java, Indonesia. This study aims to focus on two food certificates: a mandatory Halal (Islamic dietary law) certificate and the P-IRT certificate, a food safety certificate for home-based businesses. A maximum simulated likelihood (MSL) estimator was employed to account for selection bias and endogeneity.
Findings
The study highlights the continued importance of certification in agri-food markets, including e-commerce and the need to consider the degree of substitutability and resource allocation between multiple food certificates. It finds that online agri-food sellers adopting the Halal certificate earn two to three times higher compared to non-adopters. Conversely, the gross income per month from e-commerce sales is 78% lower among those adopting the P-IRT certificate. Moreover, access to regulatory information sources motivates the likelihood of adopting food certificates. In contrast, the business size, marketing channels, contractual relationship and management capabilities are insignificant factors for the adoption of any of the Halal and P-IRT certificate combinations.
Research limitations/implications
Results from this research might be specific to the context of the focus study area, thereby reducing their generalisability. In addition to gathering representative samples, future research should also capture more complex dimensions of food certificates. These include the cost of acquiring food certificates, online sellers' perceptions of food certificate adoption, and emerging topics such as group certification and the use of technology.
Originality/value
To the authors' knowledge, this research is one of the first studies investigating the adoption of food certificates within the e-commerce setting. This study also contributes to the small number of studies looking at multiple certificate adoption and food certificate issues from the retailers' perspectives
Keywords
Acknowledgements
This study was part of the AgIR: Advancing Innovation and Resilience in Agricultural Youth project, a collaborative work between Deakin University (with which Risti Permani was affiliated) and IPB University and supported by the Australian Government through the Australia-Indonesia Institute of the Department of Foreign Affairs and Trade (AII2019082). Additional funding to conduct the e-commerce survey was provided by Deakin University.
Since acceptance of this article, the following author has updated her affiliations: Risti Permani is at School of Agriculture and Food Sustainability, the University of Queensland, Gatton, Australia and the Centre for Indonesia Policy Studies, Jakarta, Indonesia.
Citation
Permani, R., Sahara, S., Satria, D., Suprehatin, S. and Nuryartono, N. (2023), "The impacts of food certificate adoption on e-commerce income among small online agri-food sellers", Journal of Agribusiness in Developing and Emerging Economies, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/JADEE-10-2022-0231
Publisher
:Emerald Publishing Limited
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