Rural
Marketing
Marketing of Agri-Produce
Regulated Market
Cooperative marketing and
processing societies
Rural Industry

Agriculture Produce
 Agriculture sector contributes 18.1% GDP in India
as on 2011.
 India is ranked second worldwide in farm output.
 India is the largest producer of many fresh fruits,
vegetables, milk, fibrous plants.
 India is second largest producer of rice and
wheat.
 India is third largest producer of dry fruits.
 World five largest producer of 80% agri. produce.
 World five largest producer of livestock with fastest
growth rate as on 2011.

Marketing of Agriculture Produce
 The peculiar characteristic of agriculture produce
result in a very complicated marketing system and
in the process rural produce are exploited. The
rural credit survey conducted by RBI in 1951
described marketing system of agriculture
produce as “Inefficient and Exploitative”
 Income of rural consumer depend upon the
efficiency of marketing of agricultural produce
irrespective of the technology adopted in
production. Any technology Innovation should go
hand in hand with efficient marketing.

Agri-Marketing
 Around 700 million people or 70% of India’s
population live in 6,38,000 villages in rural areas.
 90% of the rural population is concentrated in
villages with population of less than 2000. Rural
marketing is as old as the civilization.
 Surplus of agro products are exchanged in earlier
days in the barter system. The introduction of
currency, transport and communication has
increased the scope of rural market.

Agri-Marketing
 The demand for products an services has
increased a lot in rural areas.
 Green Revolution in North and White Revolution in
west has brought about a new prosperity in the
lives of rural people. Government emphasis on
rural development has caused significant changes
in the rural scenario.
 Moreover the special attention given for
infrastructure development through the successive
Five-Year plans has improved the buying and
consumption pattern of rural people.

Marketing of Agriculture
Produce
 The Rural Agro – Products
 The Peculiar Characteristic of Agriculture
Produce are :
 Bulkiness
 Perishability
 Wide Varietal Differences
 Dispersed Production
 Processing need for consumption
 Seasonality
 Comparative Advantage

Market them according to
needs
 There are three marketing functions while
selling of agri-product
 Assembling
 Preparation for consumption
 Distribution
 Selling of agriculture product depends
upon
 Demand of product
 Availability of storage

Selling strategies
 The products can be sold directly or stored.
 It can be sold as gathered from the filed or it
can be cleaned, graded and processed.
 Distribution system needs to match supply
with the demand by whole selling and
retailing in various points of different markets.
 Most of the time the product is sold to
moneylenders where farmers are indebted.
 It can be sold weekly in village or at irregular
intervals in mandi.

Government Institutions
 Commission of agriculture cost and prices.
 Food Cooperation of India.
 Cotton Cooperation of India.
 Jute Cooperation of India.
 Specialized market for rubber, tea,
coffee, tobacco, spices and vegetables.
 Agriculture Produce Act of 1937.

Marketing of Agriculture
Produce

Approximate Consumption Value
of Major Agriculture Equipment

Conclusion
 Rural marketing depends on agricultural produce, the
production is seasonal and the consumption is spread out
equalization of demand and supply has to be done.
 In addition, the raw agricultural produce as marketed by
farmers has to be processed by many middlemen This
include collection and assembling, financing, grading and
standardization, storage, transportation, wholesaling and
retailing these functions performed by village merchants,
commission agents, wholesalers, processors etc.
 These people seek returns commensurations with their
investments of capital, time and labor. As a result, the
middlemen get more share of the price than the
producers.

Cooperative Marketing
 A major improvement for rural producers is
the formation of cooperative societies.
Farmer’s common interest helped to increase
the incomes of the farmers and avoid
exploitation by the middlemen.
 There are about 5 lac cooperatives working
but very few cooperative societies in selected
areas like Dairy, sugar, oilseeds, Maha-grape
in Maharashtra, tomato growers in Punjab
etc. succeeded in cooperative processing
industry.

Cooperative Society
 Historically Cooperative society in India
started with enactment of the Cooperative
society Act 1904. Although in Bengal and
Bihar some preexisted.
 The purpose of cooperative societies before
independence was to provide relief to farmer
from moneylenders.
 After independence they became a powerful
instrument of economic development.

New objectives of Cooperative
societies became
A group of people should not exploit
others.
 Voluntary participation of planning and
implementation plan for economic
development.
 To avoid concentration of economic
powers.
 This is how the democratic India was
planned to emerge after independence.

Merits of Cooperative societies
 They are association of persons with
common needs.
 They join hands for self protection.
 Promote social cohesion.
 Encourage individual initiative through
collaborative actions.
 They have ideological base, economic
objectives and social approach.

Roles of Cooperative Societies
 Increase returns to the farmers
 Helpful in creating marketing infrastructure.
 Associated with other aspects of agriculture.
 Providing inputs and consumer goods.
 Others
 Finances farmer from the sale of their produce.
 Bulk purchasing so farmer has to pay less.
 Provide quantity seeds, pesticides and fertilizers.
 Arrange availability of requisite inputs and
ensure distribution.

Regulated Markets
 A regulated market or controlled market, is
the provision of goods or services that is
regulated by a government appointed body.
The regulation may cover the terms and
conditions of supplying the goods and
services and in particular the price allowed to
be charged and/or to whom they are
distributed. It is common for a regulated
market to control natural monopolies such as
aspects of telecommunications, water, gas
and electricity supply.

Regulated market
 The produce had many defects and the royal
commission in 1928 studied this. The royal commission
suggested commencing with the regulated markets
and accordingly various market committees were
incorporated. The three basic functions of this
committee were
 To meet the demand of the Increase in population and
industrial advancement.
 To increase the quality of agriculture produce.
 To fetch an appropriate price for the farmers

Objectives of Regulated Market
 To ensure reasonable gain to the farmers by creating
environment in markets for fair play of supply and
demand forces.
 To regulate market practices and attain
transparency in transactions.
 Aimed at providing proper method of sale, correct
weighing, prompt payment and various marketing
related services.
 Democratic set up to control and manage markets.

Conclusion
 There are more than 5000 primary and secondary
agriculture produce whose assembling markets
functioning in the country. These markets are
meant for farmer to take their produce for sale.
 These markets facilitates farmers, immediate cash
payments. The directorate of state Agricultural
Marketing Board or Registrar of cooperative
marketing societies is controlling these markets.
 The market is run by an elected committee
comprising of members from the farmers
community, commission agent/whole sealers and
some government nominees from Directorate of
state agriculture / cooperative societies.

Rural Industry
 Marketing of Rural/Cottage,
Industry/Artisan Product
 Rural and Cottage Industries and rural
artisan are very significant to rural
economy. They have proved to be the
source of employment and income
generation for landless population who
possess certain skills and talent acquired
over generations.

Significance
 Provide a subsidiary occupation to rural
population.
 Enable the rural population to supplement
their slender income.
 Provide employment during off season,
drought and famines.
 Develop the rural talents, help uphold our
culture.
 Reduce evil of urban Industrialization.
 Suits a country like India very well.

Classification of Rural/Cottage
Industries

Rural Industry
 There is tremendous scope for developing such rural, village and
cottage industries to augment the employment and income of
people in rural areas.
 To help such rural/cottage industries and rural artisans produce and
market their production, a number of central and state level
organization have been established.
 The first and the foremost among them are KVIC (Khadi and Village
Industry Comission) of Central Government and KVIB (Khadi and
Village Industry Board) of different state government. These
organization help rural folk in:
 Technology Up gradation
 Getting the artisan organized
 Getting credit from Institutions
 Procurement and supply of R/M
 Domestic Marketing through Retail outlet
 Export Marketing wherever possible

Conclusion
 If the rural market has to expand and grow, it
is not enough to just concentrate on
marketing of manufactured goods, but it is
also necessary to pay adequate attention to
the marketing aspect of the rural product
namely, agriculture produce of rural/cottage
industries and rural artisan.
 Such an approach will help rural population in
generating adequate disposable income for
purchase of manufactured goods.

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