Page 149 - DMGT509_RURAL MARKETING

Rural Marketing

Notes Agricultural Goods

Marketing functions: In modern marketing the agricultural produce has to undergo a series of
transfers or exchanges from one hand to another before it finally reaches the consumer. This is
achieved through three marketing functions (a) assembling, (b) preparation for consumption
and (c) distribution. Concentration pertains to the operations concerned with the assembly and
transport from the field to a common assembly field or market. The produce may be taken direct
to the market or it may be stored on the farm or in the village for varying periods before its
transport. It may be sold as obtained from the field or may be cleaned, graded, processed and
packed either by the farmer or village merchant before it is taken to the market. Some of the
processing is done not because consumers desire it, but because it is necessary for the conservation
of quality. At the market the produce may be sold by the farmer direct to the consumer or more
usually through a commission agent or a broker. It may also be purchased by traders, wholesalers
or retailers. The transactions may be carried out by direct negotiation or through middlemen,
by barter or cash, by open or under cover auction, on the spot or in future markets. The transactions
take place at one or more levels in the primary, secondary or terminal markets or all three.
Distribution (dispersion ) involves the operations of wholesaling and retailing at various points.
By a series of indispensable adjustments and equalising functions, it is the task of the distribution
system to match the available supplies with the existing demand.

8.5 Product Decisions and Strategies

Product related decisions form one of the 4Ps of marketing mix. These decisions include
introduction of new products, Improvement of existing products, planned elimination of obsolete
products and, packaging and branding. In this unit, we will discuss the framework within which
these decisions are taken. Starting with identifying various types of products, we will introduce
new terms like product line and mix. Most product decisions are taken in the context of the
overall strategy of an organisation. This strategy may also include important areas of
diversification. We will discuss Some of the important alternatives for diversification.

Types of Products

Let us now analyse the different types of products we come across. Generally products are
classified into two types, namely.
1. Consumer Products and
2. Industrial Products.

Consumer Products or Goods

Consumer goods are those which are used by ultimate consumers or households and in such
form that they can be used without further commercial processing. Consumer goods can be
divided into:
1. Convenience Goods;

2. Shopping Goods,
3. Durables or Durable Goods, and
4. Non-durables or Non-durable Goods.
1. Convenience Goods: These are goods which consumers generally purchase frequently
without making an effort or as a habit. The purchase is almost spontaneous and the person

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