Rural products

Agriculture Marketing

The bridge that links producer & consumer

ITFT COLLEGE

What Is Marketing?

• The process of determining the needs and wants of consumers & being able to satisfy those needs & wants

• Marketing includes all of the activities necessary to move a product from the producer to the consumer

ITFT COLLEGE

What Is a Market?

Buyers Sellers

ITFT COLLEGE

What Is a Market?

• A market is made up of buyers & sellers• Buyers are people who need or want a

product or service and have the money to buy it

• A market must also have sellers who are willing & able to produce goods & services for sale

ITFT COLLEGE

Two Types of Markets

Input market• The input market includes

items like metal, fertilizer, seed & wood

• These types of products are purchased by producers

Product market• This is the market where

final products are sold to consumers

• Eggs and potatoes from farms

• Shoes from shoe stores

ITFT COLLEGE

Types of Agricultural MarketsInput markets

Product markets

ITFT COLLEGE

Supply and Demand

• The price of a product is determined by the value that buyers place on the product

• When many buyers want a certain product the price will be higher

• If few buyers want a product the price will be lower

ITFT COLLEGE

Supply and Demand

Low qualityHigh quality

ITFT COLLEGE

Four Important Questions• What is the current situation?• Where do we want the situation to be?• How can we get from where we are to where

we want to be?• What is/will the operating environment be

like?

ITFT COLLEGE

How Can I Add Value?

Simple vegetablesPre-packaged vegetables

ITFT COLLEGE

Production

The goal is to add value through effective management:

ITFT COLLEGE

Value Added

Labor

Equipment

Operatinginputs

Vegetables

Dairy productsOther

Inputs (Resources) Production

A Value Chain

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Customer

Farmer

WholesalerCooperative

Equipmentsupplier

Retail Sales

Input supplier

Exporter

Identifying a Market

Those who wish to sell products identify potential target markets for their products. Once a potential market is identified, research is done to find out the wants & needs of the consumers in that particular market.

ITFT COLLEGE

Identifying a Market

Market research includes: • Surveys• Questionnaires• Literature• Any kind of information that can be found regarding the market segment

ITFT COLLEGE

Working Together

Necessary for working together• Trust • Honesty• Commitment• Openness• Board member responsibility to the members

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Examples of Working Together• Provide production & market information• Product marketing • Input purchasing• Equipment services

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Working Together in Marketing• The goal is to improve profit by buying or

selling in volume and the ability to access additional markets

• Working together requires individual farmer commitment

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Working Together

• May allow individual farmers to use proven technologies and efficiencies not available to the farmer individually

• Usually requires a formal business arrangement

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Working Together

Key questions• What are the goals for the joint operation?• Who are the members?• Do all members have the same goals?• Who is the leader/champion?

ITFT COLLEGE

Working Together

Key questions• Will it lower my costs of production?• Will it improve my market access?• Does it fit my goals?• What will be the impact on my operation?

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Working Together

Potential benefits• Access to improved technology• Capture economies of size• Improved product quality & market access• Utilize otherwise unavailable production,

marketing & information systems

ITFT COLLEGE

Working Together

Limitations of working together• Requires commitment of people• Requires joint responsibility• Loss of some degree of control• Formal business procedures• Increased communication requirement

ITFT COLLEGE

ITFT COLLEGE