Access to Market Information
& Enterprise Development
Does it work, is it important, what
can be done?
ARD Workshop on Using ICTs to Support Rural
Livelihoods: Evidence, Strategies, & Tools.
June 5, 2007
Grahame Dixie,
Agribusiness & Marketing
Specialist
South Asia Agriculture & Rural
Development
Farmers incomes extremely sensitive to marketing issues
i.e. price, quantity sold or switching to more profitable
enterprises
Net Return as impacted by Yield, Price, % marketed &
Alternative Enterprise
70000
Net Return
60000
Marketing Costs
15400
+ 10%
18000
+ 29 %
23000
+ 64%
Production costs
50000
14000
5000
- 64 %
40000
30000
20000
10000
0
base
+ 10% yield
+ 10% price
- 30% sold
Alt Enterprise
Money = Happiness, at least at the lower levels of income
Access to Market Information
Market Information: Instant
Message
Uses
Medium
Issues
Case
Studies
Enterprise Development
Market IQ: Strategic; Longer Term
Market & product Knowledge
Identification of Support Services
Business Oriented Market IQ
Market Mobilizers – Top Down/ Bottom Up
Sales Platforms
MIS & Project Design
Combined Package of Mkt Info, IQ & sales
Lessons Learned
Discuss of Needs & Next Steps
No consensus on the real impact of Agricultural Market
Information Systems on producers, meanwhile the technology
changes apace
Believers
Radio/Newspapers
Land Lines
Government
Technology
Internet
User Groups
Cell Phones
Sales Platforms
SMS
Operators
Non- Believers
PPP/ Private Sector
What Market Information do producers need ?
In Uttah Pradesh farmers priorities from
information technology were:
• market prices, (on phones+ internet),
• transport arrangements (on phones),
• selling details (on phones),
• weather forecasts, (internet),
• technical queries (internet),
• And, input supply. (on phones),
A good starting point is to ask
The Marketing Information
The Message
• Prices - typical range
• Volumes – supply/demand
• Locations –experience shows just few majors Mkts needed
• Timely – frequency product dependent
The Lessons
•
•
•
•
•
Accuracy – frequent criticisms of system
Simple & relevant
Local languages
Less perishable crops - Initially most useful
Comparable products - can be an issue in terms of weights, qualities
and grades
Information is not on its own enough – verified by
farmers
Radio the most effective means for disseminating simple
Market information
Uganda: Local language
stations effective. > US 2
cents/ household. 50% +
impact. When 2 store, mainly
non-perishable crops. Where 2
sell. Improved bargaining . Mkt
education Planting
decisions & PH/VA activities.–
Issues: Difficult interaction with
radio stations. Costs can be v
high (50% MIS budget) distorted
by Aid , one way flow of
information.
Sponsored Mkts info broadcasts
Great Interest around Internet and Web based information
Indian : ITC ‘E choupal’. Costly $
4-6 K, Mkt info, weather info plus
selling interface. Info channeled
few thru gatekeepers. Two way
communication. Distance to
collect info. Moving into inputs
sales.
Issue: Dissemination 2
producers. Skeptical about
effectiveness of web based Mkt
info. More relevant for
accessing Mkt IQ & Agri-Biz
The Cell phone the most powerful marketing tool. SMS
Market Information is taking off
Potential to deliver Mkt Info, weather forecast &
limited Mkt IQ & act as a sales platform in the
field – through either subscriptions or pay by
use. Provides income stream – potential 4
sustainability & incentive for info provider 2 B
accurate. Low unit cost $ 20 -40/ handsets
Issues: around literacy,
new texting skills,
vernacular scripts,
coding costs &
sustainability.
Text messages cost a fraction of US 1 cents @, industry standard
50:50 split between phone & content provider. Phone company’s
key driver is revenue – manager discretion whether to forgo short
term SMS income for long term talk time. Regulator v. important
Phone Co 5 cents,
Content provider 2.5
cents, MIS service
2.5 cents
MNET, US1 cent
TNS/Tradenet
Subsidy
US 3 cents
50:50 Split
Phone &
MIS
Case Study : REUTERS – SMS in India, v positive test
marketing results, now rolling out 5 States, seen as Social
Investment
Service
5 SMS/day in local languages, across all phone networks
1. Mkt Prices & supply – 4 Markets nearest handset High, Low
and Average price + impression of price – initially for range of
field crops (legumes) x 2 day
2. Weather forecast
3. Market Overview
Issues
Cost s – circa $ 1/month, or US cents 2.5 @
Financial Sustainability indication need to be millions of
subscribers
Info gathered by paid, knowledgeable local observers who phone
in daily
Issue is limited availability of vernacular handsets (3%), and
handsets 7% of landowners, 2% of landless.
Farmers liked the REUTERS SMS service
because:
•
•
•
•
SMS perceived as an enhancing livelihood product
the farmers feel empowered – greater control
receiving the message in the field in local languages
Weather info for crop activity planning, better yields &
harvest timing
• Mkt info for decisions of when to store/sell & where to
sell
• 90% of the farmers are willing to buy, No differences
between crop & land holding size
• concern on authenticity of source/data – called Mkt to
verify
REUTERS aim to prove they can supply info to ‘Master
of the Universe’ Traders in NY/London as well as to
Small scale Farmers in India
CASE STUDIES
Cell phones the most powerful marketing tool: two
way information, SMS, real time market price/supply/demand info,
phone market research, logistics co-ordination.etc.
Backyard Chickens, critical mass to improve sales price
because of Grameen cell phone connection
9 Chickens = Tk 14 each
50 chickens = Tk 20 each
Cell Phone = emergence of large
Cell Phone = Nigerian Catfish
scale primary wholesale markets in
Assam
Market Queen running + $ 1.85
million business by phone
Cell Phone = Delhi wholesalers
selling trucks to other traders on
the road & diverting to end market
Cell Phones = Georgian Winter
salad growers collect price in
Moscow – so that they can take
informed negotiating positions
Case Study: Elegant analysis of the impact of the Cell phone on
Fish Marketing in Kerala, South Western India by Jenson
Phoning in from off
shore
Mobile phones coverage rolled out in three phases
With cell phone calls possible ‘off shore’ - fishermen call different
beach auctions to decide the best market on that day. Result 1/3
of fishermen take fish to more distant auctions. Rapidly learned to
the equation of transport cost viz. likely additional sales price.
Wastage down from
5-8% to 0%
Result was that fishermen and consumer were winners, as the
market become more efficient and rational.
Price volatility down
dramatically
Fishermen prices up
by 8%, profits
improved
Consumer prices
down by 5%,
Access to Market Information
Market Information: Instant
Medium
Uses
Message
Issues
Case
Studies
Enterprise Development
Market IQ: Strategic; Longer Term
Market & product Knowledge
Identification of Support Services
Business Oriented Market IQ
Market Mobilizers – Top Down/ Bottom Up
Sales Platforms
MIS & Project Design
Combined Package of Mkt Info, IQ & sales
Lessons Learned
Discuss of Needs & Next Steps
Market Intelligence: Strategic Information,
Longer Terms Decisions
Medium
• Internet – down load
Message (s)
• Market Overview
• publications
• Product Mkt. requirement
• combined with cell
• Standards, specifications
Uses
• Mkt orientation
• Mkt research
• Mkt knowledge
• Business Linkages
• Enterprise mix &
Diversification
• Business Contacts
Issues
• Whose job?
• Dissemination
• Language/Literacy
• Technology
ICT can only be part of the package for lifting rural
incomes
Listing of contacts
• Traders
• Input suppliers
• Transporters
• Agribusinesses
• Service Providers
• Trader/ Agri Biz Associations
Unit Costs Information/ Benchmarks
• Inputs – seeds, fertilizers, packaging
• Transport costs
E.g. South Africa: India under the ATMA concept in Bihar
Enabling Enterprise Development
Market Intelligence
Top Down
• Longer term market knowledge
• Business Linkages, marriage
broking
• Early dispute resolution
• Standards, specifications
• Buyer – seller meets
• Major products/opportunities
(80:20)
• Businesses, service providers
• Trader Associations
Bottom Up–
Business Mobilizers
• Agribusiness Business advisers
• Marketing Extension
• NGOs
• Skills trainers
Experiential Market learning
• Groups, Associations CIG
• Resource audit – product
options
• Basic economics
• Own market research
• Visit working examples
• Plan program
• Draw down required TA/SP
Tradenet – development phases
Phase 1
Phase 2
Central Govt
Input on Info
But: no accuracy,
timeliness, insight,
language
Private Traders &
observers
Groups &
Associations
v. variable
Phase 3
Phase 4
Central Govt
Groups &
Associations
Peer 2 Peer
Peer 2 Peer
Sales platform
Slow to take off Trade Agent
Testing now
Internet Based Software Platform – broad cast SMSSales Platform
License fee
Free Basic
$ 5000 pa
License fee for
add services
Sponsorship Transaction fees
e.g. Banks
Insurance
SMS - phone
companies
Cell Phone Based
Phone Calls
Producers,
Associations etc
Traders &
Agribusiness
SMS sales platform
Broadcast
SMS
Extension/
NGO - internet
Line Dept Web Site
Market IQ
Govt Sector, Line
Depts.
Broadcast
SMS
Web Based Platform
Trader Ass Web Site
Market
Information
Private Sector
Info gatherers
Public Sector
PPP
Private Sector
Best Practices
Phone Regulator Role
Management of MIS
Sector Studies
Phone Operators
Generation & Update Mkt IQ
SMS Broadcast
Mkt Policy Framework
Standards, Specifications
? Cost subsidy SMS
Trading Activities
Producer Mkt Info Needs Assessment
Pump Priming Activities
Gathering Mkt Info
Service provider Contract
Mkt Ext / Biz Mobilizers
Grouping/ Common Interest
ICT Equipment & Initial contracts
Auctions
Commodity Exchanges
Warehouse receipts
Access to Market Information
Market Information: Instant
Medium
Uses
Message
Issues
Case
Studies
Enterprise Development
Market IQ: Strategic; Longer Term
Market & product Knowledge
Identification of Support Services
Business Oriented Market IQ
Market Mobilizers – Top Down/ Bottom Up
Sales Platforms
MIS & Project Design
Combined Package of Mkt Info, IQ & sales
Lessons Learned
Discuss of Needs & Next Steps
And if you have been . . .
Thanks, for listening
Now is the time for
talking
Cell Phone Based
Phone Calls
Producers,
Associations etc
Traders &
Agribusiness
SMS sales platform
Broadcast
SMS
Extension/
NGO - internet
Line Dept Web Site
Market IQ
Govt Sector, Line
Depts.
Broadcast
SMS
Web Based Platform
Trader Ass Web Site
Market
Information
Private Sector
Info gatherers
Marketing Extension
Marketing Education
Co-ordinating
Business Linkages
Creating a better
understanding of the
process, the market & its
demand's - terms of
products and service
Mobilising groups,
Organising events,
getting things
started, hand
holding, injecting
energy
Making introductions,
between buyers &
sellers. Facilitating
the start up process of
new trading
relationships
It Does Not Mean
Deciding for farmers what they should do or what products to sell
Any active participating in distribution, marketing & sales
The ME course is a 6 step process, designed
to empower villagers to identify market
opportunities & plan how to exploit them.
FO - all
Step 1
Resource audit –what produced, embedded skills, resources
& equipment, existing marketing arrangements & knowledge
Task Force
Step 2
Step 3
Step 4
FO - all
Selection of target products, detailed costings, analysis of
alternative markets, selection of location for markets research
Market research task force holds discussions with traders on
potential products in terms of prices, quantities, quality &
market opportunity
Analysis of Market Research findings & potential
profitability of alternative products
Step 5
Strategic choice of products for marketing development
Step 6
Action plan, activities, responsibilities, timings for the
selected products
The ME course increased marketing knowledge
amongst CBOs (i.e. 3x) and continued to improve
with practice
CBOs measurement of their marketing skills levels
90
80
M.E.
Course
70
60
50
%
40
30
20
10
0
Before
After
Now
Average AVA per CBOM involved
The average additional cash income per group was in
mainly in the range $ 2000 - $ 7000 and per involved CBO
member is $ 200, but ranges from about $ 70 to $ 325.
350
Sinduri A
Rakhalgachi A
300
Chalkaladi B
250
Shafalgasi A
Uzirpukur C
200
Mollikpur A
150
Nagar Kusumbi A
Parbatta Samity
100
Sandhani
Samobay A
Merrirhat Samaj A
50
Tripti Mohila A
0
Nizpara Purush A
0
5
10
Months since ME Training
15
Namapara S. B
Vandarpara A
The ME process has generated a diversity of businesses,
the most important of which in terms of numbers involved
are listed below
Mini garments
Tooth Pick
Cap sewing
Paposh preparation
Male
Goat rearing
Ground nut processing
Female
Hand fan preparation
Tailoring
Egg
Jujubee marketing
Vegetable selling
Health Product marketing
Ice cream Stick
Bee cultivation
Homeo bottle preparation
Nackshikatha/ katha sewing
Pond fish culture
Bamboo products making
0
100
200
300
400
500
600
ICT can only be part of the package
Business Development Services
Listing of contacts
Enabling Enterprise Development
Market Intelligence
• Traders
• Major products/opportunities (80:20)
• Input suppliers
• Longer term market knowledge
• Transporters
• standards, specs
• Agribusinesses
• Service Providers
• traders/ Agri Biz
Associations
Business Mobilizers
• Marketing Extension
• Skills trainers
• Buyer – seller meets
• Business advisers
• Trader Associations
Top Down
• Business Linkages, marriage broking
• Early dispute resolution
Bottom Up Processes – Experiential
Market learning
• Groups, Common Interest Groups
• Resource audit – product options
• Basic economics
• Own market research
• Visit working examples
• Plan program
• Draw down required TA
Believers
Market Information: Instant
Medium
Non- Believers
Access to Market Information
Message
Market IQ: Strategic; Longer Term
Medium
Message
• Radio 
• Price - accurate
•Internet 
• Market Overview
• Internet ?
• Supply- timely
•publications
• Product Mkt. Specs
• SMS ?
• Weather
• Standards
• cell 
• Overview
• combined
with cell
Uses
• Store or sell
• Place to sell
• Negotiation
Issues
• Relevance
• Govt vs Private/NGO
• Dissemination
Uses
• Mkt orientation
• Mkt research
• Mkt knowledge
Issues
• Whose job?
• Dissemination
• Educate
• Language
• Cost vs.Sustainability
• Accuracy – Incentive
• Technology
• Diversification
• Ent mix.
• Technology
• Contacts (BDS)
• Language
WB Team Leaders
MIS & other instruments developed sequentially
• policy framework, - specific sector studies - farmer organizations,
• market information, market IQ - grades & standards, databases
• Positive approaches to empower producers (groups) to engage
with market
• legal trading framework, financing for traders,
• support for private sectors trade organizations,
• warehouse receipts, commodity exchanges, advocacy
Key technology – Radio – Mkt Info, SMS, Web for Mkt IQ & cell phone for
everything else. PPP for sustainability,
•Service provider contract to provide integrated web & SMS market information
& market intelligence data
•Provision of cell phones with limited time contract to farmer groups, with
closed user group access to project, technical services
•Subsidy on SMS costs, PPP between phone companies, content providers
Using the ICT information to promote enterprises & Livelihoods
Mkt IQ - base information, Mkt Info – on going. Business Mobilizers,
linkages support, Marketing Extension
Harilai – Rurally based Farmers supermarket, with Internet access
& technical support
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