Agricultural marketing involves in its simplest form the buying and selling of agricultural produce. In olden days when the village economy was more or less self-sufficient the marketing of agricultural produce presented no difficulty as the farmer sold his produce to the consumer on a cash or barter basis.
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.
MARKETING FUNCTIONARIES (AGENCIES)
The transfer of produce or goods takes place through a chain of middlemen or agencies. In the primary market the main functionaries are the producer, the village or itinerary merchant, pre-harvest contractors, commission agents, transport agents etc. In the secondary market the processing and manufacturing agents are the additional functionaries. Financing agents such as shroffs, banks and co-operatives may also take part. In the terminal or export market the commercial analyst and shipping agent also gets involved in the transfer of goods.
The functionaries have their own set up. They may be individuals, partners or co-operatives who may buy and sell on ready and future basis at a price determined by forces of supply and demand. Each functionary renders some service in the process of marketing and also earns a varying margin of profit for himself. This procedure makes marketing rather complicated and inflates the price of the produce. The nature of some of the agricultural products for eg. their bulk form and perishability and their seasonal availability further add to the complexity of agricultural marketing.