SwanCape Farms & Retail Store Lekki Ajah In vegetable business; possession of an outstanding production technique is great but can ...
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| SwanCape Farms & Retail Store Lekki Ajah |
In vegetable business; possession of an outstanding production technique is great but can an arrow pierce without the sharply pointed arrow head? The arrow head in vegetable production business is strong marketing strategies. In Part 1 of this article, we have highlighted Steps involve in developing marketing strategies which are
- Decide on target market
- Produce decision and timing
- Price intelligence
- Understand and the use of human psychology: Psychology of First impression
We have also looked at some likely target markets in Part 1; let us now look at the remaining likely target markets for vegetable growers.
Local or state Farmers’ market: Due to challenges experiences in sales, local farmers over time have come up with an initiative to choose locations mostly within rural areas close to farming communities where they come together on every pre-determined day to sell their produces. In the South-West Nigeria, it is called “Oja Oko” or local market days on every 4 to 5 days or specific day of the week every week in some other locations. In these markets, all growers irrespective of the type of produce bring their produce for sales mostly at wholesale prices.
You may want to read: Team Production strategies in vegetable production
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| Central major Market |
Central Daily veggies market: The difference between local or state farmers markets and central daily veggies market is that the later operates every day while the former operates only on certain pre-determined date. For every state for example in Nigeria, there is a major central veggies market while other small markets too also exist in other locations within the state but the transacting volume at the major central market is very large comparatively. A major grower growing on acres of land may want to target only central major markets where all her produce can be sold within a short time however, pockets of smaller markets scatter around the state have low trading volume on daily basis, hence, is only suitable for small growers or small produce. In this market, dealer’s fee is paid for every produce sold. Some notable major central fresh veggies markets in Nigeria are Dei-Dei market in Abuja, Mile 12 in Lagos, SaSa market in Ibadan, Sabo market in Akure etc. You may want to read: Team Production strategies in vegetable production
Local, regional and National Groceries and big retail stores: Across the country, there are numerous grocery stores, retail outlets and chain-store type of supermarket. The later such as Spa, Shoprite, Foodco, Ace food among others usually have central purchasing department responsible for supplying their outlets. Policy may exist to buying only specific varieties and quality of produce. Mostly they go for grade produce and have preference for breaker instead of already ripped produce in case of fruits. You may want to check with their local stores produce manager to see if they do local purchase and find out their need before you decide if this need can be met.
Many of these outlets also prefer growers which can assure them of consistent quality supply of produce. More often than not, their demand volume may be far below what a grower’s output offers therefore grower may need to look at other media to sell her produce. They often do not pay instantly therefore the grower may need to allow some reasonable time before payment is made.
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| Cooperative Produce from Iseyin farms heading to Mile 12 |
Farmers’ Cooperatives: This involves pulling together of produce by farmers in the same cooperative to be sold jointly to larger markets. It saves the farmers the huge cost of transportation they could have incurred individually to transport to larger markets. Some big cooperatives provide a variety of services to their members that include but not limited to packing, cooling, selling, collective bulk purchase of supplies and labour arrangement. All these enable them to have greater bargaining power. The ease of selling through cooperative would be assured if planting and harvesting are also synchronize provided it is plan ahead of time.
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PRODUCE/PRODUCT DECISION AND TIMING
Decision on which specific crop to produce and the time of the year to produce comes with certain degree of complexity; therefore it is essential the farmers gather enough information from other growers, dealers, even consumers beforehand. It takes a lot of time before valuable experience is built towards this direction. The following guides would help:
Deciding on the target market: Sell before you produce! How do I mean by this? You need to visit the target market(s) first to look at its modus operandi, the varieties or appearance of produce they buy, the average quantity per time, the packaging structures, the sales method employ, the payment method etc. It is often good to also relate first hand with some of the growers who have been used to the markets for some time in order to share out of their wealth of experience. Always remember that market is un-kind as everyone is out there to take advantage of novice growers. You may also want to find out about produce market trend from the dealers to understand the surplus/glut or dip/scarce period of the year. This is specific to every crop. Establishing good relationship with produce dealers at the markets is essential even during off season.
Also do note that in produce industry especially in general markets, it is not usually possible to create genuine commitment with buyer to buy your crop before it is grown. However, it is more likely to develop marketing strategy that will improve chances of finding a profitable market for the crop. Always answer that question of where would it be sold before cultivating. Do not base the sales of your produce on assumption, it does not mostly work. The market decision often guide you through the choice of crops, varieties and even when to grow. While any general market can take any grade of produce and find retailers for it, chain of supermarkets or direct market sales would not take anything short of grade A.
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Decide on Return on Investment: In addition to the choice of target markets, there is a need to decide on profitability of the engagement. You may need to run a simple analysis of what it would cost to produce this crop ranging from the cost of inputs to labour, transportation and even too fixed cost. With this information, a range of likely net return on investment can be estimated at various likely selling price per unit. Please always use the lowest reasonable price per unit possible in order to be on the safer side. Look at all these analysis outcomes if it is in-line with your long term and short term objectives of your interest in crop farming business.
Calculate risk involve in production: Every business has it risk but risk in crop farming business is a bit high. Find out about what you need to do to reduce production and marketing risk such as irrigation, pest control, timely planting, and price fluctuation among others. Lastly, developing good post-harvest handling is essential in vegetable business being that it is highly perishable. Buyers would only pay for the quality of what they see and would avoid poor quality produce.
Understand market trend of produce: Every crop has it surplus time as its scarcity during the course of the year. Ensure you understand this so that you don’t produce at a time when you don’t have competitive advantage or demand/price is very poor.
I trust you have also gained one or two marketing weapons in this article which you can add to your marketing strategy armory. You would do well to read the Part 3 (Click to read Part 3) of this chain of articles where I would talk about last part of what it takes to develop full potent marketing strategy that would place you at vantage point in this vegetable business.
You may reach out to me at the instance of any question, comment and critic. Like us on FB and Follow us on IG. Cheers.
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