Phase 3 Literature review
7 Hypothesis and National questionnaire development 1 Hypotheses development
7.2 National Questionnaire Development
7.2.1 Developing the questionnaire
The questionnaire was based on the information and responses given during the in-depth interviews and focus groups. Four main hypotheses were developed in the previous section to provide a rational for design of the national questionnaire. The design of the questionnaire was developed to meet four criteria:
1. compatible with the structure of the theoretical models; 2. understanding by, and participation of, respondents; 3. simplicity; and
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Dillman (2009) suggests a four-step method to ensure a concise and ordered approach to the structure of a questionnaire:
1. a review of the questionnaire by people well acquainted with the subject to ensure that relevant questions were asked, there are no redundant questions and questions are relevant to the research model;
2. carry out interviews to evaluate the questionnaire;
3. perform a small pilot-study to exactly mimic the main survey procedure to give a true idea of projected response rate; and!
4. check and complete the questionnaire by people that were not associated with the research. This is to eliminate any errors that may have been missed by those associated with the development of the questionnaire. !
However, because of the perceived complex nature of FPRMs, as detailed to this researcher when communicating with farmers, a modified procedure was conducted to ensure reliable results and a sufficiently high response rate:
1. Construction of original questionnaire and review by researcher and supervisors. The conclusions were to reduce the number of questions, amalgamate some questions and structure the questionnaire into sections that approximated the research model after a small pre-pilot survey.
2. Pre-pilot survey using six farmers known to the researcher. Each farmer was sent the questionnaire by post and asked to complete and make comments. The researcher then visited the farmers to discuss the questionnaire and their comments. The conclusions were that the questionnaire was too long, some questions were similar and some seemed irrelevant.
3. Based on the conclusions above, an amended questionnaire was sent by post to a group of twenty farmers known to the researcher. This questionnaire contained a feedback comments form, which the farmers were also asked to return. The
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conclusions were that the questionnaire was still too long and some questions were similar.
4. Following revisions, a pilot-questionnaire was distributed by the HGCA by post to 30 farmers not known to the researcher. The sample database was chosen to include farmers in the major wheat growing regions of England. It was then further constrained to only include farms with over 500 acres of arable crops. The farm businesses targeted were predominantly arable based and the wheat produced was not consumed on the farm by an animal enterprise. There was included a stamped addressed envelope to be returned to the Centre for Agricultural Strategy at the University of Reading. After a month the non-responders were re-sent a duplicate questionnaire. It was concluded were that the very low response rate was due to the length of the questionnaire and perceived repetitiveness of some questions.
5. The questionnaire was shortened considerably and several questions were combined following the results of the pilot survey. Three non-farmers as well as supervisors reviewed this and decided that there were no further corrections needed. Due to time and budgetary constraints it was not possible to conduct a repeat of the pilot process, thus this revised questionnaire was adopted as the final national questionnaire.
The final questionnaire was designed not only to elicit data on the use of FPRM tools but also farmer demographics, farm business and structure. Previous use of FPRM tools was not a necessary prerequisite of eligibility to participate in the survey as the use by farmers is estimated at 5 to 15% (DEFRA and HGCA, 2009) and this would have reduced the number of possible participants. The location of the farms surveyed was limited to the major wheat growing and selling regions of England, that is, regions where the wheat crop is predominantly a cash crop for selling off the farm, not for feeding the producers’ livestock. Questions were a mixture of Likert-style, tick boxes and free text. In the following section the sampling process and questionnaire format is described.
177 7.2.2 National survey
7.2.2.1 Introduction
The questionnaire was formulated and based on research, the model developed in Chapter 6 and the questionnaire development phase. Farm-specific questions were a simple choice from a range of possible responses. The questions were designed to elicit information concerning the use of FPRM tools when selling wheat, farmer demographics and business functioning.
7.2.2.2 Sampling process
Two databases of arable farmers in England were used. The first was drawn from the national database of the HGCA. The sample database was chosen to include farmers in the major wheat growing regions of England. It was then further constrained to only include farms with over 500 acres (200 ha) of arable crops. That is the farm businesses targeted were predominantly arable based and the wheat produced was not consumed on the farm by an animal enterprise. From a potential sample population of 3350 a random sample of 2000 was selected. An anticipated 20% response rate was predicted giving a usable sample population of 400. From previous agricultural literature the usable response rates vary from 5-35%. Garforth et al. (2006) showed 29% usable responses, Rehman et al. (2007) 29%, Tranter et al. (2009) 5-35% and Sottomayor et al. (2011) 34%. The questionnaire was distributed by post, directly from the HGCA in late September 2012. The second sample consisted of 273 farmers in the Agricole database and was independently posted simultaneously with the HGCA mailings. The analysis will differentiate between the two samples and will be testing for any differences that may result. A reply paid envelope was provided. Completed questionnaires were returned to the University of Reading, Centre for Agricultural Strategy. A reminder letter was sent out to ‘non-responders’ from the two databases after five weeks of the original mailing in early November 2012.
7.2.2.3 Questionnaire format
The questionnaire was divided into six sections, directly related to the major components of the research model and is detailed in Appendix 8. However, the titles to the sections in the
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questionnaire do not exactly equate to the actual names of the components to avoid the use of technical terms, which may have deterred the respondents from answering. The following gives the major sections of the questionnaire whilst Chapter 8 presents the questionnaire in more detail.
Section A: Current behavioural variables.
In the questionnaire the CBVs were labelled as ‘Factors regarding the selling or marketing of wheat’. The aim of this section was to elicit information about the farmers’ current behaviour and attitudes towards the grain trade in England, methods of selling wheat, use of FPRM tools, how an acceptable wheat price was derived and importance of the wheat crop to overall farm income. The questions used are shown in Table 7.1 and were derived from the in-depth interviews and focus groups as well as from the literature (Fliegel, 1993; McLeay and Zwart, 1998; Beedell and Rehman, 1999). The questions were designed to cover current selling practices including whom they sell to, how they market and set prices and their attitudes towards the wheat industry. Further questions asked if they had used FPRMs and their experiences of them. Some questions required the respondent to choose from a list, some yes/no and others used a Likert Scale.
Section B: Attitude factors.
In the questionnaire, the Att factors were labelled as ‘Factors relating to the use of hedging tools when selling or marketing of wheat’. The factors forming Att were represented by: relative advantage; compatibility; complexity; ease of use (trialability and observability); and, risk and are constructed from the responses recorded during the qualitative phase of the research.
179 Table 7.1 Variables relating to current behaviour
Question How to measure
Type of grain trade used Choose from a list
I feel I am actively encouraged to sell my wheat by various methods Likert Scale
It is important to have an on going relationship with the organisation that gives me selling advice Likert Scale
I try to use independent advisory services to sell my wheat Likert Scale
Spot, forward and Pools are the only ways I can market my wheat Likert Scale
With large wheat price volatility I am looking for a method of selling wheat which reduces the risks of a ‘bad’ sale
Likert Scale
I would like a way of marketing wheat that can adapt to global factors that affect my wheat price, both positively and negatively.
Likert Scale
I tend to trade with those I have a strong personal bond / had a previous trading relationship Likert Scale Have you ever used hedging tools, formal exchange traded futures and options, when you have sold
the following crops?
Yes/No
Have you ever used hedging tools, ‘futures’ and ‘options’ type contracts via the merchant trade, when you have sold the following crops?
Yes/No
Which of the following statements describes your experience with hedging tools? Choose from a list How do you set a price for your wheat to achieve an acceptable return Choose from a list Indicate the frequency of use per year, over the past 5 years, of selling methods from a list Choose from a list My farm’s long term sustainability relies on the income from the wheat crop Likert Scale
I am committed to my wheat producing enterprise Likert Scale
I take a strategic macro view of the wheat market when choosing how to sell wheat Likert Scale
I know the quality of my wheat crop from one season to the next Likert Scale
I know the quantity of my wheat crop from one season to the next Likert Scale
I consider my tax and/or financial situation when selling my wheat Likert Scale
I know what revenues my crop will bring in 2012 Likert Scale
It would have been advantageous to my business to have used a hedging tool this year Likert Scale
The questions used to extract the Att factors are shown in Table 7.2and were derived from the literature (Rogers, 1995; Tan and Teo, 2000; Quaddus and Hofmeyer, 2007) as well as the in-depth interviews and focus groups. The table shows that each of the sub-constructs has been decomposed into questions relating to various aspects associated with that sub- construct. For instance, relative advantage consists of budgeting and price discovery amongst others. Each of these factors is composed of a belief and evaluation question according to TRA and TPB theory. For example the questionnaire asks if FPRMs help with annual budgeting (belief) and how important annual budgeting is to the respondent (evaluation). All questions are measured using a Likert scale.
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Table 7.2 Factors related to the Attitude construct of FPRM tools Sub-construct Belief/
Evaluation Question used Relative advantage
Specific topic:
Budgeting Belief Hedging tools help with annual budgeting and making a profit Evaluation How important is annual budgeting to your business? Price discovery Belief Hedging tools enable the setting of minimum market price
Evaluation How important is it to set a minimum price for your wheat crop?
Market price volatility Belief Hedging tools reduce the adverse effects on income of volatile wheat market price movements
Evaluation Is it important to reduce adverse income effects in your business? Second chance to market
crop
Belief Hedging tools enables me to have a second chance at marketing my crop Evaluation How important is it to have a second chance when marketing?
Reduces price reduction Belief Hedging tools remove the chance of a price reduction, due to quality and quantity issues, after the contract is agreed
Evaluation Removing the chance of a price movement, due to quality and quantity issues is important to me
Price comparison Belief I will achieve a better price than other farmers I know not using hedging tools Evaluation Achieving a better price than other farmers I know is important to me Compatibility
Specific topic:
Business cash flow requirements
Belief Hedging tools fit in well with business cash flow requirements Evaluation How important is business cash flow to you?
Alternative to ‘traditional’ selling methods
Belief Hedging tools are an alternative to ‘traditional’ selling methods Evaluation How important are ‘traditional’ selling methods to your business Complement ‘traditional’
selling methods
Belief Hedging tools are a complement to ‘traditional’ selling methods Evaluation How important is it to have other methods to sell your wheat? Use of existing wheat trade
contacts
Belief I use my existing wheat trade contacts to set up hedging tools Evaluation How important are your existing grain trade contacts to you?
Good and fit for my business Belief Overall, adopting the use of hedging tools to market my wheat would be good and fit well with my overall farm business
Evaluation How important is it that a new selling method fits well with your existing business? Complexity
Specific topic:
Experience and confidence Belief Hedging tools require experience & confidence
Evaluation Experience and confidence is important when using a new marketing method Easy to use Belief Hedging tools are easy to use
Evaluation A new marketing method that was easy to use would encourage me to use it Terminology Belief Hedging tools have more jargon to learn than ‘traditional’ selling methods
Evaluation A new marketing method with many contract terms and jargon would deter me from its use
Ease of use Specific topic:
Easy to use Belief Are easy to use
Evaluation A new marketing method that was easy to use would encourage me to use it
Risk
Specific topic:
Less/lose money risk Belief I am worried that using FRPM tools will give me less money or even lose my business money than using ‘traditional’ selling methods
Evaluation A risk of making less money than ‘traditional’ selling methods is a concern Quality and quantity risk Belief I am worried about not meeting contract quality and quality specifications, which
could result in a financial penalty
Evaluation The risk of a financial penalty from not meeting contract quality or quantity terms is a concern to me
Good risk management strategy
Belief Using hedging tools are a good risk management strategy being a trade-off between risk management and maximising revenue
181 Section C: SN factors.
In the questionnaire the SN factors were labelled as ‘Factors relating to social influences to your use of hedging tools when selling wheat’. The SN included questions relating to five social groups identified from in-depth interviews, focus groups and literature (Ajzen, 1991; Fritz and Fischer, 2007) and are: merchants; independent advisors; farmer peers; farming press; and, academia. Respondents were asked the same four questions for each of these groups. These questions followed the standard format of TRA and TPB and asked if the social referents would recommend the use of FPRMs and if they felt motivated to comply with this, measured using a Likert scale. However, because of the consistent response during the focus groups of the issue of trust, the questionnaire also included two further Likert scale based questions on whether the respondent trusted the advice on both the wheat market and FPRMs.
Section D: PBC factors.
In the questionnaire the PBC factors were labelled as ‘Questions relating to training, support and information on your use of hedging tools when selling wheat’. PBC is represented by training, information, and support and represents the overall ‘self-efficacy’ and ‘facilitating conditions’ of the producer. The questions used to extract the PBC factors are shown in Table 7.3and were derived from the literature (Ajzen, 1991; Tan and Teo, 2000) as well as in-depth interviews and focus groups. The table shows that each of the sub-constructs has been decomposed into questions relating to various aspects associated with that sub- construct. For instance training consists of technical and one to one seminars. Information consists of Internet and Press. Support consists of practical help and monitoring. Each of these factors is composed of a belief and evaluation question according to TRA and TPB theory. For example the questionnaire asks if technical seminars would encourage the use of FPRMs (belief) and how important technical seminars are to the respondent (evaluation). All questions are measured using a Likert scale.
182 Table 7.3 Factors related to the PBC of FPRM tools
Sub-construct Specific topic Belief/Evaluation Question used Training Technical
seminars
Belief Technical seminars would encourage me with my decision to use hedging tools
Evaluation Training from technical seminars is important to me 1-2-1 seminars Belief One-to-one seminars would encourage me with my decision
to use hedging tools
Evaluation Training on a one-to-one basis is important to me
Information Internet Belief On-line information would encourage me to use hedging tools
Evaluation On-line information is important to me
Press Belief Good information from the farming press would encourage
me to use hedging tools
Evaluation Information in the farming press is important to me Support Practical help Belief Having good practical help with setting up hedging tools
would encourage me to use them Evaluation Practical help is important to me
Monitoring Belief Monitoring and reviewing hedging tools over their ‘life time’ would encourage me to use them
Evaluation A monitoring and reviewing process is important to me
Section E: Behavioural Intentions.
In the questionnaire the Behavioural Intentions were labelled as ‘Questions relating to Behavioural Intention on your use of hedging tools when selling wheat’. This section aims to assess the current views on FPRM tools and what is the intention to use in the future. However, rather than considering BI solely as the intention to adopt FPRMs, BI has been decomposed into five separate intention factors.
Intention to adopt is a fundamental part of the TRA, TAM, TPB and DTRB models and so the factors represented here are adapted from previous studies (Sultan et al., 1990; Frambach et al., 1998; Marcil et al., 2001; Christian and Armitage, 2002; Quaddus and Hofmeyer, 2007). The first factor shown in Table 7.4 asks if the use of hedging tools would have been good and fit well with the overall business. The second two factors ask if the respondents intend to use FPRM tools as part of their wheat marketing in the next year as either the main method or just to use but not as the main method. The final two factors show how responsive wheat producers are to using FPRM tools with a change in market price and relate to the issue of whether producers trying to secure a perceived higher price or protect against a subsequent price fall. The price movement, derived from the LIFFE wheat futures