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Marketing of Agricultural Commodities
What is Marketing?
All activities involved in the production
& flow of goods & services from point
of production to consumers
It involves anticipating customers
needs & wants & findings ways
to satisfy these needs.. profitably
-Anticipating
- Needs & Wants
- Management Process
- Customer Satisfaction
- Profitability
Developed by Paul Armah
Marketing Involves
Non-agricultural Marketing;
Agricultural Marketing;
Agribusiness Marketing
Non Agricultural Marketing
Defined: All activities involved in the
production & flow of non-agric goods &
services from point of production to
consumers.
Developed by Paul Armah
Agricultural Marketing
Defined: It is the connecting link btwn
farmers & consumers or performance
of all activities involved in the flow of
food pdts & services from point of initial
pdn until they are in hands of consumers
Involves 2 activities ….
Developed by Paul Armah
1.Physical Distribution: Includes
processing,
handling
&
transfer of farm products from
farmers to consumers.
2.
Economic
Exchange:
Involves exchange & pricesetting activities.
Developed by Paul Armah
Food Marketing Channel
Retailers
Consists of firms
& their functions
that form industry.
Sell to Consumers
Wholesalers
Food Processors
Sell to Grocery &
Specialty Food Stores,
Restaurants & Institutions
Distribute to brokers &
wholesalers,
Assemblers & Brokers
Sell to Food & Processors
Farmers
Sell products through
Assemblers & Brokers
Its the food marketing or
distribution system.
Agribusiness Marketing
Is the marketing of supplies & services to & from the
farm producer.
Its a blend of agric. & non-agric.
marketing.
Agribusinesses add utility or value to farm product to
enable consumers buy
the preferred product (Form)
in the right place (Place),
at the right time (Time)
& at the right price (Price)
Developed by Paul Armah
The Agribusiness Industry
Provide inputs that agric
producers need
Transform & distribute pdts
to consumers in desired form
Input Sector
Production
Sector
Farm Sector: Produce
crops & livestock
Developed by Paul Armah
Processing &
Manufacturing
Market
An area for organizing business activities & for
answering basic economic questions of what, how, &
how much to produce, & distribute it.
Thus a market may be defined by:
 a.
A Location (e.g. Jonesboro market)
 b.
A Product (e.g. the grain market)
 c.
A Time (e.g. August soybean market)
Most important feature of a market is Economic: i.e.
its pricing & exchange activities.
Productivity of Agric Marketing
Is Agricultural Marketing Productive?
1. Parasitic View: Activities performed in the marketing
channel is often viewed as ‘parasites’ or
unproductive. This is not true.
2. Utility View: Economists define production as utility
creation. Utility is classified into: Form,
Place, Time & Possession.
Form Utility: Hog producers & sausage processors
create form utility - change raw material to
useful pdt
Place Utility: Railroads & truckers add place utility by
Developed by Paul Armah
moving pdts from producers to consumers
Time utility: Packers may freeze & store pork &
supermarkets may also hold sausage for the
future. These are time utilities.
Possession utility: A wholesaler seeks out a retailer
who finally sells the sausage to consumers.
By transferring the sausage these people are
adding possession utility.
Thus all those involved in moving the pdt to the right
place, at the right time and in the right form in order to
produce the final utility to the consumer are
Developed by Paul Armah
productive.