The document discusses agricultural marketing and defines it as the process of finding out what customers want to buy and getting agricultural products to them at the right place, time, form, and price. It lists the key activities in agricultural marketing as research and analysis, assembly, buying and selling, storage, transporting, packaging, processing, standardization and grading, financing, information dissemination, and risk bearing. The document also discusses factors to research like production areas, markets, and marketing systems as well as problems affecting agricultural marketing like product characteristics, number of producers, and consumer characteristics.

1. AGRICULTURAL MARKETING: Basic Principles and Applications
AGRICULTURAL
MARKETING
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

2. AGRICULTURAL MARKETING: Basic Principles and Applications
WHAT IS AGRICULTURAL MARKETING
≠ SELLING
≠ PROMOTION
Chairman of a Cooperative:
“Involves finding out what your customers want and supplying it to
them at a profit”
= CUSTOMER-ORIENTED
= it is a commercial process that it has to provide profit for it to become
sustainable
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

3. AGRICULTURAL MARKETING: Basic Principles and Applications
A more detailed definition:
It is the PROCESS of finding out what customers will buy, and
producing and performing all the activities involved in getting
agricultural products from the farm where they are produced to the
final consumers, at the right place, time and form desired by the
consumer, and at a price the customer is willing and able to pay for the
product.
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

4. AGRICULTURAL MARKETING: Basic Principles and Applications
Activities in Agricultural Marketing
1. RESEARCH AND ANALYSIS
2. Assembly
3. Buying and selling
4. Storage
5. Transporting
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

5. AGRICULTURAL MARKETING: Basic Principles and Applications
6. Packaging
7. Processing
8. Standardization and grading
9. Financing
10. Marketing information and dissemination
11. Risk bearing (associated with the vagaries or unpredictable
changes in weather, incidence of pests and diseases, and seasonal
patterns of harvests, demands, prices, etc.)
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

6. AGRICULTURAL MARKETING: Basic Principles and Applications
Remember PDCA Cycle:
RESEARCH
AND ANALYZE
ACT
PLAN
CHECK
DO
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

7. AGRICULTURAL MARKETING: Basic Principles and Applications
WHAT TO RESEARCH
THE PRODUCTION AREA
 problems (constraints) and opportunities (primary selling
points) of the area
 must cover crop production to product consumption (if possible)
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

8. AGRICULTURAL MARKETING: Basic Principles and Applications
THE MARKET
 customers needs and wants
 the suppliers
 the competitors
 etc.
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

9. AGRICULTURAL MARKETING: Basic Principles and Applications
THE MARKETING SYSTEM
 how the market works
 relationships of the different participants in the marketing chain
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

10. AGRICULTURAL MARKETING: Basic Principles and Applications
What Else to Know to Better Understand
the Agricultural Marketing Process and System
Government policies and programs affecting food production,
pricing behavior, and distribution system. Examples are the
Department of Agriculture’s various production programs;
government’s price regulation policies and changes; Import and
export policies.
Large members, spatial distribution and conflicting objectives of the
different marketing participants, buyers and sellers, distance from
each other, and the varying interests of the marketing participants
affect the marketing of a commodity.
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

11. AGRICULTURAL MARKETING: Basic Principles and Applications
Motivations, strategies, reactions, and survival tactics of
marketing participants in response to changes in infrastructure,
organization, institution, management, and technology.
COMPETITION is the engine of markets. However, it should
always be taken as a challenge for product or service
improvement. A good business competitor is one that stays in the
field for a long period of time.
Geographic dispersion of production. Demand areas are usually
located afar from producing areas.
Problems and constraints of those marketing participants
actually involved in producing, processing, distributing and
consuming.
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

12. AGRICULTURAL MARKETING: Basic Principles and Applications
GUIDING PRINCIPLES OF
AGRICULTURAL MARKETING
1. Know who the customers are.
Could be identified as hotels, restaurants, wholesalers,
exporters, retailers, cooperatives, processors.
2. Know the customers needs/wants before planning to make
it.
Commodity, form, frequency of need, price, volume required
per unit of time, etc
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

13. AGRICULTURAL MARKETING: Basic Principles and Applications
3. Determine how much to produce.
Based on principle no. 2, determine the extent of product
volume that should be provided given the existing resources
4. Produce the product(s) that the customer wants to buy, not
products which the producer finds convenient to produce.
5. Organize a distribution system.
The delivery or distribution system should match the customers’
habits, rather than just correspond to any convenient time that the
producer can offer.
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

14. AGRICULTURAL MARKETING: Basic Principles and Applications
6. Feedback mechanism. Make production (or collection) and distribution
(or dissemination) decision based on feedback from customers.
Timely, adequate and appropriate feedback system can be attained
through maintenance of records, regular monitoring, and
surveillance/spot checking.
The feedbacks will tell the producer whether changes that need to be
introduced.
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

15. AGRICULTURAL MARKETING: Basic Principles and Applications
SOME PROBLEMS AFFECTING
AGRICULTURAL MARKETING
1. Characteristics of the product
a) Perishability
Delayed disposal of agricultural products would mean quality
deterioration, weight loss, and eventually reduced price. The
role of marketing system then is to get products to the
consumers before the above actions take place.
b) Seasonality
When product is in season, price is low, and vice versa. Thus
consumers usually pay high prices during scarcity of supply and
low prices when the product is in season. Marketing certainly
becomes simpler if desired products are available in the market
centers with the right volume, quality, form and time.
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

16. AGRICULTURAL MARKETING: Basic Principles and Applications
c) Bulkiness
Small farmers usually have no choice but to sell their produce
to, and accept whatever price is dictated by, traditional or
village traders. This is generally true due to small volume of
production. In marketing, the greater the volume of produce,
the stronger the bargaining power of a farmer/producer.
d) Non-homogeneity
When farmers sell a number of different products at small
volumes, it will take time for the assemblers/traders before
they can collect enough to transport. Also, they may require
different marketing procedures like different buyers/outlets,
different packaging, different transport requirements, different
pricing procedures, and different services. These factors surely
add up to their costs, which eventually cause them to lower
their prices.
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

17. AGRICULTURAL MARKETING: Basic Principles and Applications
2. Number of Producers.
Large and scattered number of producers create
problem for assemblers/traders to efficiently collect,
store and transport agricultural products.
3. Characteristics of consumers.
It is difficult to move with the changing demands of
consumers. They usually differ in demand due to
differences in income, age, taste/preferences,
occupation, place of residence, religion, weather, habit
because of cultural influence, change in price of
substitutes, and the like.
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

18. AGRICULTURAL MARKETING: Basic Principles and Applications
Related Problems ON, and OF, FARMERS:
1. Production-oriented
2. Dependence on traditional traders due to small
marketable surplus
3. Limited credit availability
4. Ineffective rural assembly
5. Lack of credit-marketing tie-up
6. Lack of marketing information
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

19. AGRICULTURAL MARKETING: Basic Principles and Applications
7. Inefficient marketing and postharvest practices
8. Lack of specialization
9. Lack of group action due to lack of trust and unity
10. Lack of knowledge and expertise on marketing
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

20. AGRICULTURAL MARKETING: Basic Principles and Applications
CONSIDERATIONS IN SELECTING PRIORITY
PRODUCTS (NEW OR FOR EXPANSION)
1) Is there a demand?
- whose demand and where
- excess of local demand vs. supply
- products brought in from outside; import
substitution
- suitability to local and neighboring markets
- financially viable
- answers needs/preferences of consumers
2) Agro-climatic condition
3) Soil/geology
4) Slope
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

21. AGRICULTURAL MARKETING: Basic Principles and Applications
5) Other physical factors:
- flooding hazard; drainage; land capability; present vegetation
6) Elevation
7) Economic benefits
8) Availability of production technology
9) Availability of postharvest technology and other support facilities (if
necessary)
10) Socio-cultural acceptability
11) Comparative advantage
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

22. AGRICULTURAL MARKETING: Basic Principles and Applications
12) Knowledge, skills, experience, and production equipment of
local producers.
13) Availability and sufficiency of planting materials and raw materials
14) Availability of technical support to assist production
15) Potential farmers’ organizations and cooperatives
16) Synergy with existing products and ecological requirements
17) Adequacy of transport facilities for product distribution
18) Operational or proposed community development plans to intensify
activities and provide support
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira

23. AGRICULTURAL MARKETING: Basic Principles and Applications
Melba D. Davis - Mussagy 14 June 2007 IITA – Ibadan, Nigeira