Perceived Quality and Price Variation in Tea Marketing

Abstract

Tea sector is an important part of Kenya’s economy as a leading export earner. Kenya Tea Development Agency (KTDA) farmers’ earnings in bonus payment fluctuate based on variation in tea prices, however farmers in the West of rift valley under KTDA factories are paid less compared to East of rift valley and this disparity has caused economic difficulty. The purpose of the study was to investigate the relationship between perceived quality and price variation in tea marketing. This was anchored on the Theory of Reasoned Action. The study employed correlational research design with cluster and purposive sampling proceduresadopted to collect secondary and primary data.The primary data utilized a census of 128 tea brokers, tea warehouse and buyers who handle tea in Mombasa tea Auction. Cronbach alpha obtained for perceived quality was 0.706. Descriptive and inferential analysis was done using Microsoft Excel, SPSSand STATA. Simple linear regression analysis was used to test research hypotheses at 5% significance level. Perceived quality had positive significant relationship with price variation (P<0.05). The study concluded that perceived quality had significant relationship with price variation. There is need to improve tea quality from West of rift valley through benchmarking and training which would result in better tea quality and changing the perception of the tea quality.