KING JEHU II QUIRINO RADAZA, MBA

Department of Agribusiness Management

College of Agriculture
CENTRAL MINDANAO UNIVERSITY

Master of Management Certificate

College of Economics and Management
University of the Philippines Los Baños
Los Baños, Laguna Philippines

MBA, International Management

School of Management
ASIAN INSTITUTE OF TECHNOLOGY
Bangkok, Thailand
KING JEHU II QUIRINO RADAZA
AM
Department of Agribusiness Management
GRICULTURAL
ARKETING
College of Agriculture
CENTRAL MINDANAO UNIVERSITY
What is Agricultural Marketing?

Marketing is one of the most important

aspects of an agricultural business. It is
considered important since it is rational to
think of the market first before producing any
kind of agricultural product.

In agriculture sector, marketing begins when

the farmers first think of crops and livestock to
be produced to earn a profit and at the
same time to satisfy the need of the market.
Marketing provides the important key in the growth of the
agricultural sector. This is closely associated with efforts in
increasing productivity which increases products
available for local consumption and exports. Unlike in
manufacturing, farmers usually encounter marketing
problems because they have to deal the peculiarities of
the production process and the product produced. For
the past decades many programs and projects have
been implemented and almost all of them were
production programs. Little attention has been given to
agricultural marketing and it seems this area has been
neglected. Thus, in most agricultural programs, marketing
has always been identified as one with many problems.
TOPICS TO COVER
Basic concept of Agricultural Marketing

Approaches in Studying Agricultural

Marketing
Market Analysis in Agricultural Products

Marketing Channels

Marketing Cost and Margins

Marketing Programs

Marketing Plans
BASIC CONCEPT AM

Marketing – series of services (activities,

functions) involved in moving a farm
product from the point of production to
the point of consumption.
There are three terms in the definition that
need emphasis
A. Services B. Point of Production
C. Point of Consumption
BASIC CONCEPT AM
A. SERVICES
These are any function or activity performed on or for
the product that alters its form, time, place and
possession characteristics.
They add value to the product and someone has to
pay for the services rendered.
These activities or functions are categorized into:
a)Transactional – which include finding buyers,
buying and selling and risk taking
b)Logistical – which include grading, assembling,
packaging, storage, transportation and
presentation of customers and
c)Facilitating functions- which include
dissemination of marketing information,
marketing research and financing.
BASIC CONCEPT AM
A. POINT OF PRODUCTION
The point of usual first sale by the farmer at
the farm or at the farmer’s home. At this
point, transaction occurs and a farm price is
established

B. POINT OF CONSUMPTION
The point where marketing ends or the
point of last sale where the goods are in the
possession of the final consumer, a
transaction occurs and a price is
established.
BASIC CONCEPT AM

Why Marketing is Productive?

It is productive because it creates utility, the
process of making useful goods and services.
It is the want satisfying power of an object or
service.

a. Form Utility b. Time Utility

c. Place Utility d. Possession Utility
BASIC CONCEPT AM

A. Form utility is created if goods possess the

required properties. They change the form of raw
materials and create something new.

B. Time utility is created when products are made

available at the time when they most wanted

C. Place utility is created when products are made

available to the place where they are most wanted.

D. Possession utility is created when goods are

transferred or are placed under the control of the
persons who desire to use them.
BASIC CONCEPT AM

Market has three elements: buyers, sellers

and trading facilities.

It refers to a group of buyers and sellers with

facilities with one another. It is a place
where buyers and sellers meet to exchange
goods and services
BASIC CONCEPT AM

Agricultural Marketing System

for agricultural products is a complex
system within the various subsystem that
interact with one another and with different
marketing environment. It has the following
characteristics:
BASIC CONCEPT AM
Agricultural Marketing System
1. It has goals or objectives to attain
2. It has components or participants to
perform certain functions and all
necessary job between the decision to
produce and the final consumption of
the product.
3. It needs institutional arrangements
4. It needs planning and management
decision structure which control and
coordinate the forces at work
5. It has spatial and temporal dimension
and most often commodity specific.
BASIC CONCEPT AM

The marketing system has six

subsystems:
A. Producer Subsystem
B. Channel Subsystem
C. Flow Subsystem
D. Functional Subsystem
E. Consumer Subsystem
F. Environmental Subsystem
BASIC CONCEPT AM

A. Producer subsystem – consists of the

initiators of production who produced
goods and brought to consumers via
channel subsystem
BASIC CONCEPT AM

B. Channel subsystem – consists of market

participants who are directly responsible for
making farmer’s products available to the
user at the right place, time and form. They
are considered “actors’ in the system who
perform vital functions but sometimes they
get ire of the producers, consumers and the
government.
BASIC CONCEPT AM

C. Flow subsystem – facilitates product

financial information flows such as product
trends, grading, standardization and prices.

D. Functional subsystem – consists of

marketing functions or services related to
the creation of place, time and form
utilities that involve assembly,
concentration and dispersion.
BASIC CONCEPT AM

E. Consumer subsystem – the final

repository of products produced by
farmers.

F. Environmental subsystem- facilitates

market performance encompasses four
other areas or factors that affect the
working of the entire marketing system:
climatic/physical, socio-cultural,
economic/technological and
legal/political factors.
BASIC CONCEPT AM
Knowledge of marketing and its problems will help
farmers make important decisions on the following
aspects:
1. What to produce and how to prepare it for
sale?
2. When and where to sell ?
3. How much of the marketing job should be
done by the farmer himself either as
individual or as a member of the group?
4. What can be done to expand markets?
5. Which of the many different marketing
arrangement are desirable?
6. How to secure changes necessary to
correct undesirable practices be served ?
BASIC CONCEPT AM
On the part of middlemen and consumers
the marketing system performs the following
functions:
1. Provide an outlet for intermediaries of
agricultural products
2. Distribute goods and services to
consumers in the desired forms and
conditions and delivers them at prices
consumers are willing and able to pay.
3. Provides employment for middlemen
and producers
BASIC CONCEPT AM

Characteristics and Problems of Agricultural

Marketing
1. Dependence on middlemen can be
explained by small farm size, poor cash
position of the farmers and unavailable
marketing facilities
2. Inadequate market information
3. Inadequate marketing support services
4. Unique features of agricultural products
(seasonality, perishability, handling reqt.)
5. Number of producers
6. Characteristics of consumers
BASIC CONCEPT AM

Entry Points in Agricultural Marketing

1. Organization of Small Farm Businesses
2. Corporate and Small Grower
Arrangement
3. Establishment of Trading Posts
4. Setting up of Grading Standards for
Agricultural Products
5. Building of Marketing Infrastructures
and Communication facilities
6. Market Research in Agricultural Product
BASIC CONCEPT AM

Traditional Agricultural Marketing Practices

Agricultural marketing in the Philippines
revolves around the “suki system.”

Suki refers to regulars or special exchange

partners. Under this system there is a special
arrangement between the sellers and the
suki and this was found to affect the seller’s
pricing, distribution and promotion
strategies.
BASIC CONCEPT AM
1. Tawad - a practice in which the buyer asks for
reduction in price or an additional unit of a
commodity.
2. Price by piece or tingi - a practice of selling bits
and pieces rather than the whole standard size
(economy packaging).
3. Por kilo- another economy packaging activity
wherein instead of selling the whole piece, the
meat is chopped into pieces and packed by the
sellers.
4. Buena mano – a term used to describe the first sale
buyer for the day. The first buyer is given special
treatment because the seller believes that if the
first sale is good, then all the others will also be
good.