Fish marketing

Agricultural Marketing

1. Fazlul Hoque MBA (DU), M. Econ (Thailand & Germany) Asst. Professor Dept. of Agribusiness & Marketing Sher-e-Bangla Agricultural University, Bangladesh.

2. Market A market is one of a composition of systems, institutions, procedures, social relations or infrastructures whereby parties engage in exchange. Features: Place Market participants Exchange relationship Negotiated price

3. Classification of the Market Market is categorized based on following conditions Nature of Competition Location Regulation Users Products Traded Coverage

4. Nature of Competition Perfect Market Large number of buyers and sellers Homogeneous products No constraint on entry or exit Producer as price taker Imperfect Market An imperfect market is a market where one or more conditions of perfect competition are Lacking. Ex. Monopoly, Oligopoly etc.

5. Location Primary Markets These are markets at primary level such as a village market, roadside market and small town market. Secondary or Wholesale Markets Secondary or wholesale markets carry out the function of assembling agricultural produce and disposing off it to consumers Retail Markets The small shopkeepers and street vendors who purchase agricultural produce from primary and secondary markets in bulk and sell it in small quantities to the consumers. Terminal Markets A market, which is mainly involved in the export of commodities, is called terminal market. These are generally situated in large urban centres .

6. REGULATION Free Market Free market is a market where demand and supply forces operate and interact freely without any restriction on price setting mechanism and as result perfect competition prevails in the markets. Ex. Local market Regulated Market A market managed by an elected committee or local authorities is known as a regulated market. Ex. City corporation administered market.

7. END USERS Consumer markets These markets consist of individuals and households who buy products for their direct/ultimate consumption. Ex. SAU Minibazar , Dhaka. Industrial/Business Markets Industries and institutions that buy products for further processing form industrial markets. Ex. Kawran Bazar, Jatrabari , Showarighat Fish market.

8. PRODUCTS TRADED Factor (Input) Markets These are the markets where factors (inputs) used for agricultural production are bought and sold. Pesticide, fertiliser , seed, farm machinery and labour markets are examples of factor markets. Product (Output) Market In product markets, agricultural produce is traded. For example grain markets, fruit markets, vegetable markets etc.

9. COVERAGE Domestic Markets Domestic markets provide goods and services to the domestic consumers only. Only those items are traded which are in consonance with the domestic socio-cultural and economic requirements. Domestic markets include local, regional, and national markets. International Markets International markets serve the foreign consumers and are characterized by intense competition in terms of price and quality. Producers market their products considering the requirements of foreign buyers. Ex. Border Market.

10. The peculiar characteristics of fish Market. Perishability Wide varietal differences Seasonality Processing needs for consumption

11. Agricultural Marketing According to Thomson, “the study of agricultural marketing comprises all the operations and the agencies conducting these, involved in the movements of farm produced foods, raw materials and their derivatives such as textiles, from the farm to the final consumers, and the effects of such operations on farmers, middlemen and consumers”. Acharya and Agarwal defined agricultural marketing as “comprising of all activities involved in supply of farm inputs to the farmers and movements of agricultural products from the farms to the consumers”.

12. Agricultural Marketing A comprehensive definition of agricultural marketing may be as under; “Agricultural marketing embraces all business activities involved in production planning, transformation, grading, storing, transportation and distribution of goods and services related to agriculture as desired by agricultural producers (farmers) and ultimate consumers”.

13. Economic Development & Agricultural Marketing 1. Traditional Subsistence Economy Production & Income low Little marketable surplus Limited varieties of crop Technology adoption low or totally absent Less developed market Absence or little access to ICT Ex. Tribal Community, remote area –island etc.

14. Transitional Economies Productivity of agriculture is high More marketable surplus Wide varieties of crop Income is high Public & Private support Developed market and marketing function Better Access to ICT Medium size to Large farmholdings Ex. District or Upazilla Market

15. Market Oriented Agriculture Large commercial farm Adoption of Modern farming techniques More Agri-food processing industries Government having special patronization to agriculture Specialized crop selection based consumer preferences.

16. STAKEHOLDERS IN AGRICULTURAL MARKETING SYSTEM Producers( Farmer, Fishermen) Traders( Commission men, brokers, wholesalers and retailers) Trade supporter( local authority, Bank, DAM, Govt) Trade planer ( Committee) Consumers

17. Marketing System Productivity Marketing system productivity is usually measured by the amount of usefulness often referred to as “utility” that the system adds to the agricultural products. The marketing process add utility and hence value and desirability to a product for the satisfaction of customer needs and wants. Form Utility Place Utility Time Utility Possession Utility

18. The processing function adds form utility to the product by changing the raw material into a finished form. With this change, the product becomes more useful than it is in the form in which it is produced by the farmer.

19. In case of agriculture, production is not spread evenly throughout the year rather skewed in specific seasons and considerable time lag exists between production and consumption. The storage function adds time utility to the products by making them available at the time when they are needed.

20. The transportation function adds place utility to products by shifting them to a place of need from the place of plenty. Products command higher prices at the place of need than at the place of production because of the increased utility of the product

21. Possession utility is created by the process of transferring ownership of the product from sellers to buyers at the right time. Man holds up a four-kilo Hilsa fish which sold for a whopping Rs 22,000 A fisherman has caught a big Hilsa weighing more than 3.5 kilograms and Price 12200 BDT, Bhola.

22. Marketing Function a) affect costs and value to consumers b) cannot be eliminated and c) can be performed by anyone in the system. 1. Exchange Function ( Buying & Selling) 2. Physical Function (Storage, Transportation, Processing) 3. Facilitating Functions ( Standardization& Grading, Financing, Risk bearing, Marketing Intelligence)

23. Th e exchange functions refers to those marketing activities which are related to transfer of ownership of goods and are mainly related to price determination process in the marketing chain. Buying Needs of the customer Production is purposely planned to meet specific demands or market opportunities. It is mainly concerned with finding out the sources of supply, assembling of products and the activities associated with purchase. Business buyer or Consumer Price & Quality Selling Decisions concerning proper unit of sale, proper packages, The best marketing channel, The right time and place to approach potential buyers constitute the selling function advertising and other promotional tools used to influence or generate demands

24. Storage The storage function adds the time utility to products. Production of agriculture is based on seasonality and fluctuating but demand is relatively stable. Thus, it necessary that large quantities of farm produce should be held for a considerable period of time. 1. To ensures a continuous flow of goods in the market. 2. To protects the quality of perishable and semi – perishable products from deterioration; 3. To stabilize of prices by adjusting demand and supply; 4. The storage of some farm commodities is necessary either for their ripening ( e.g.banana , mango, etc.) or for improvement in their quality (e.g., rice, pickles, cheese, , etc.); 5. To Generate employment and income through price advantages Risk: Quality degradation, Price risk and Quantity loss.

25. Processing The processing activity involves a change in the form of the commodity. Processing converts the raw material and brings the products nearer to human consumption. Advantages: 1. It changes raw food and other farm products into edible, usable and palatable forms. 2. The processing function makes it possible for us to store perishable and semi – perishable agricultural commodities 3. The processing activity generates employment.. 4. Processing satisfies the needs of consumers at a lower cost. 5. Processing serves as an adjunct to other marketing functions, such as transportation, storage and merchandising. 6. Processing widens the market.

26. Packaging Packing means, the wrapping and crating of goods before they are transported. Goods have to be packed either to preserve them or for delivery to buyers. Packaging is a part of packing, which means placing the goods in small packages like bags, boxes, bottles or parcels for sale to the ultimate consumers.

27. Benefits of Packaging 1. It protects the goods against breakage, spoilage, leakage 2. The packaging of some commodities involves compression, which reduces the bulk like cotton, jute and wool. 3. It facilitates the handling of the commodity, specially such fruits as apple, mango,etc., during storage and transportation. 4. It helps in quality-identification, product differentiation, branding and advertisement of the product, e.g., Radhuni Masala. 5. It helps in checking adulteration. 6. Packaging with labeling acts better than salesman which reduces the marketing cost.

28. Transportation The Transportation Function refers to all those activities that ensure availability of goods at proper place. Agricultural commodities are generally produced in rural areas whereas these are consumed mostly in the areas which are located at distant places. Advantages: 1. Widening of the Market 2. Narrowing Price Difference Over Space 3. Creation of Employment 4. Facilitation of Specialized Farming 5. Transformation of the Economy 6. Mobility of the Factors of Production

29. The cost of transportation 1. Distance 2. Quantity of the Product 3. Mode of Transportation 4. Condition of Road 5. Nature of Products a) Perishability (e.g., Vegetables, fish); b) Bulkinesss (e.g., straw); c) Fragility (e.g. tomatoes,fish ); d) Inflammability (e.g., Petrol); e) Requirement of a special type of facility ( i.e , for livestock and milk). 6. Availability of Return Journey consignment 7. Risk Associated: Problems in Transportation of Agricultural Commodities 8. Illegal fees & commission of the musclemen

30. Problems 1. The means of transportation used are slow moving; 2. There are more losses/damages in transportation because of the use of poor packaging material. 3. The transportation cost of the farm produce is higher than that for other goods. 4. There is lack of co-ordination between different transportation agencies, e.g., the railways and truck companies

31. Grading and standardization Standardization means making the quality specifications of the grades uniform among buyers and sellers over space and over time. Standards are established on the basis of certain characteristics-such as weight, size, color, appearance, texture, moisture content, staple length, amount of foreign matter, ripeness, sweetness, taste, chemical content, etc. These characteristics, on the basis of which products are categorized are termed grade standards.

32. Grading means the sorting of the unlike lots of the produce into different lots according to the quality specifications laid down. Each lot has substantially the same characteristics in so far as quality is concerned. It is a method of dividing products into certain groups or lots in accordance with predetermined standards. Grading follows standardization.

33. Advantages of Grading To get a higher price for their produce To facilitate marketing, for the size, color, qualities To widen the market for the product To reduce the cost of marketing To get standard quality products at fair prices To ensure market competition and pricing efficiency.

34. Source: Field survey, 2010.

35. Financing Financing is the advancing of money to execute various marketing processes and functions. Generally, there is a time gap between the purchasing of raw products and selling of finished goods to the ultimate consumer in case of agribusiness products. Capital Requirements ( i ) Nature and Volume of Business (ii) Necessity of Carrying Large Stocks (iii) Continuity of Business during Various Seasons (iv) Time Required between Production and Sale (v) Terms of Payment for Purchase and Sale (vi) Fluctuations in Prices (vii) Risk-taking Capacity (viii) General Conditions in the Economy

36. Market Information Market information is a facilitative function required for efficiently operating marketing system. Accurate, adequate and timely availability of market information facilitates decision about when and where to market products. a) Market Intelligence: This includes information relating to such facts as the prices that prevailed in the past and market arrivals over time. These are essentially a record of what has happened in the past. Market intelligence is therefore, of historical nature. b) Market News: This term refers to current information about prices, arrivals and changes in market conditions. This information helps the farmer in taking decisions about when and where to sell his produce. The availability of market news in time and with speed is of the utmost value

37. Good Market Information a) Comprehensive b) Accuracy c) Relevance d) Confidentiality e) Trustworthiness f) Equal and Easy Accessibility g) Timeliness

38. The Risk-Bearing Function It is an acceptance of possibility of losses in the marketing of a product. The physical risks may occur due to destruction or deterioration of the product itself by fire, accident, wind, earthquakes, cold and heat. Market risks may arise due to changes in value of a product as it is marketed. An unfavorable movement in prices might result in high inventory losses. Changes in consumer taste, competitors’ strategies. Insurance is used to avoid the physical risk.

39. Assignment on the marketing functions performed at the fish market in your area.

40. FARMER’S ASSOCIATIONS / COOPERATIVES A farmer association or cooperative is a collective organization owned by people who benefit from its services. The members elect a governing body to administer the affairs of the cooperative. Shares of the cooperative are divided equally among its members. Each member has only one vote for the election of governing body and other major financial decision as outlined in the charter. Failure: poor performance, mismanagement, corruption in the use of financial assets and funds and use of cooperatives for political goals.

41. Types of Cooperatives Marketing cooperative voluntary business organization established by its members to market farm produce or to purchase farm supplies collectively for their direct benefit. To assemble, store and sell a number of commodities like food grains, horticultural and livestock products, fisheries items. The higher marketing efficiency due to economies of scale in availing transport, storage and other services. Power of farmers in sales transactions. Purchasing cooperative Purchasing cooperatives are established to supply farm supplies to its members. These cooperatives purchase farm supplies form the source in volume and then sell in small quantities to their patrons. Service cooperative Service cooperatives can be used to provide financial (credit or insurance) or technical service for its members. These can be used as a business organization for owning electrical power, telephone, irrigation or other facilities for the benefit of members. Processing cooperative Processing cooperatives are organized to carry out the processing and packaging of farm products. For example, a processing cooperative can on a fee basis to the patron provide livestock slaughter and packaging, grain milling or vegetable canning.

42. Business The term "business" also refers to the organized efforts and activities of individuals to produce and sell goods and services for profit. Sole (single) proprietorship is simplest form of business organization. It may be termed as one man show wherein all the business operations are carried out mostly by a single person. Street vender, small hotel& restaurant, retail fish selling, haircut centre etc. Private enterprises may be established under partnership arrangements wherein two or more persons may join together to earn profit from business venture. Partners pool their resources and expertise for their business venture. A company is a legal entity formed by a group of individuals to engage in and operate a business—commercial or industrial—enterprise. A company may be organized in various ways for tax and financial liability purposes depending on the corporate law of its jurisdiction. Krishibid group, Thermex group etc.