Understanding the drivers of milk consumption in Kenya : A thesis submitted in partial fulfilment of the requirements for the Degree of Master at Lincoln University

Kenya’s dairy industry has an annual milk production of close to five billion litres. The industry contributes about 8% to the GDP and employs an estimated one million people at the farm level. Despite the positive contribution of the industry to the economy of Kenya, it has a highly fragmented supply chain comprised of formal and informal sectors that supply processed and unprocessed milk, respectively. The informal sector dominates the industry, and this is brought about by the fact that Kenyans choose raw milk over processed milk, despite extensive concerns over safety issues reported frequently in the media. These issues reinforce the decision by the Kenya Dairy Board to ban milk sales in the informal sector. Consequently, the study aimed to increase our understanding of consumers’ milk purchasing behaviour in Kenya, thereby providing insights into the demand drivers for fluid milk in Kenya. Primary data were collected by means of semi-structured questionnaires distributed to 539 respondents in Uasin Gishu and Nairobi Counties. The data were analysed using binomial logit regression and Nvivo. The findings of this study revealed that education, employment status, family composition, product and packaging preferences and consumers’ perceptions of, and trust in, milk sellers were significant determinants of their purchasing behaviour. Surprisingly, price was not found significant in the regression model but emerged as an important theme in the qualitative analysis. The results indicated that consumers were driven to purchase milk based on the trust they have with the seller; they also selected outlets based on their preference for the type of milk sold. Most consumers reported boiling milk before consumption regardless of its origin, reflecting a high degree of risk aversion. The qualitative data analysis suggested that enhanced safety regulations and improved traceability systems would help grow the formal milk marketing channels and ensure the safety of milk sold from farm to bottle. The results offered insights into the characteristics and perceptions of the Kenyan dairy consumer as well as useful information to policy-makers and industry stakeholders while contributing to the limited knowledge of the use of milk dispensers