Agriculture Marketing System

1. Agriculture Marketing System • Understanding agriculture marketing system • Key players involved in agriculture marketing system • Interest of these key players? • How to reconcile the conflicting interests? • “Perform stakeholder analysis”

2. Agriculture Marketing System • Production sub-system: - farmers • Distribution sub-system: - traders, wholesalers, retailers, transporters, processors (middlemen) • Consumption sub-system: - consumers • Regulatory sub-system: - Govt. organizations

3. What is stakeholder analysis? • It is an approach for understanding a system by identifying the key actors or stakeholders in the system, and assessing their respective interests in, or influence on, that system. • Stakeholder analysis is useful for assisting in decision-making situations where various stakeholders have competing interests and stakeholder needs must be appropriately balanced.

4. When to Use it • Stakeholder analysis may be used at a variety of levels and purposes: • Institution or business - to examine the health of an organization and plan changes • Project or program – to design, steer and monitor a project • Particular decision – to predict the consequences of a decision, and plan to deal with them

5. Who are Stakeholders • Stakeholders are those who have rights or interests in a system. • Stakeholders are any group or individual who can affect, or is affected by the achievement of the organisation’s purpose. • It includes interested parties as well as affected parties.

6. Stakeholders • Stakeholders can be individuals, communities, social groups, or organisations. • For example, stakeholders in agriculture marketing policy might include farmers, traders, agri-business firms, processors, support service providers, consumers, and Government agencies

7. Stakeholder Analysis – Approach • Develop purpose of analysis and initial understanding of the system • Identify key stakeholders • Investigate stakeholders’ interests, characteristics and circumstances • Identify patterns and contexts of interaction between stakeholders • Assess stakeholders’ power and potential roles • Assess options and use the findings to make progress

8. Characteristics of Stakeholders • Location - rural/urban dwellers • Ownership - landowners/landless, managers, staff, trade unions • Function - producers/consumers, traders/suppliers/competitors, regulators, policy makers, activists, opinion-formers • Scale – small-scale/large-scale, local/international communities • Time - past, present, future generations

9. Four R in Stakeholder Analysis • Role of each stakeholder in the system • Rights, Responsibility, Revenue (Benefit) and Relationship

10. Assess Stakeholder Power and Potential • Different degrees of power to control decisions • Different degrees of ‘potential’ to contribute, or ‘importance’, to achieving a particular objective in the system

11. Power • Stakeholder power can be understood as the extent to which stakeholders are able to persuade or coerce others into making decisions, and following certain courses of action. • Power may derive from the nature of a stakeholder's organization, or their position in relation to other stakeholders.

12. Potential • Potential to affect, or to be affected by, policies and institutions resides in particular characteristics specific to context and location – such as knowledge and rights. • These stakeholders’ problems, needs and interests are likely to be the most ‘important’ for many initiatives to improve policies and institutions processes.

13. Stakeholders and their Interests • Farmers: Highest possible returns from the sale of their produce - Maximum price, unlimited quality irrespective of quality • Consumers: Highest food value at the lowest possible price - Low price, limited quantity of high quality

14. Stakeholders and their Interests • Middlemen: Earn the greatest profit - low purchase price, high quality, high selling price, low cost of operation, reliable supply • Government:Consistent to macro-economic policies - Equitable distribution, food security, natural resource conservation, low pollution, employment, foreign exchange earning • How to reconcile these conflicting interests? – One of the primary task of agriculture marketing system.

15. Stakeholders and their Interests • Each players think in its own interest having short run perspective • But in the long run, no player can survive without others • Evolve a long run relationship among the players allowing each group to take care of its interest – Is it possible? • Probably yes! Recent strategic partnership models between farmers, government, corporate houses can provide high hopes in Indian context.

16. Recent Initiatives • Direct purchase from farmers by trading or processing companies (avoiding mandis) • Market Information system • Backward integration of firms • Promoting Farmers Interest Groups • Conducive policy environment by govt. • Partnership between input, output and credit delivery systems • Agriculture exports

17. Laws and Govt. Policies Domestic and Global Economy Science and Technology Customs and Values • The Food Marketing System : • Firms, organizations • Product flows, distribution channels • Management and Marketing Activities Competition Consumer Tastes and Preferences Infrastructure (transport, communication, education etc.)