WHY MARKET SURVEY AND MARKETING IS IMPORTANT
BY AFOLABI BUKOLA
Many enthusiastic agro-preneurs, as we call ourselves, lack basic skills and technical know-how on how to manage a business most especially in the area of locating or finding markets for our produce. All we are after is to start the business and hopefully make money in 3-4months based on what we read online. The major problem we are faced with is that, we do not look for markets before planting, rather we plant, and afterward, we look for who will buy, and in case of perishables, we end up selling at a rather low price and most of us don’t even make our capital not to talk of profits.
I tell people before you venture into any form of agribusiness, do your market survey, look for price trends. There are institutions or companies, like SENCE Agric, that collate market prices and you can ask for price trends of the commodities you intend to grow, to serve as a guide. From the trends, you can deduce when your produce will be at its cheapest and when it’s likely going to reach its highest price.
After getting this information, the next thing is to find your buyers. Do not make the mistake of producing and hoping that someone from somewhere will come and buy, you will end up selling below your cost price out of desperation. When you find buyers make sure you reach an agreement preferably by a written contract specifying quantity and price an indication to your potential customers that you are serious. If you have an excess of produce, you can now take it to the open market. The following is a personal story of how I thought I had the perfect business plan but failed to find buyers for my produce and ended up paying the price.
I remember going online looking for blogs or websites where I can learn how to start any form of agriculture that will fetch good returns in 3-4months max. A little while later I settled on catfish rearing. I called up a friend who has been in the business for quite some time, to put me through. We did cost and projections, he introduced me to some of his colleagues who helped with the construction of my concrete ponds which was located at the back of my house. I bought my stock, my feed and some boosters that I was encouraged to buy and that began my journey into becoming a catfish farmer.
At first, I found it quite engaging and fun, I visited daily to look at my fishes growing and thriving, I felt so proud of myself. Then 4 months later and the fishes were ready for sale. It then dawned on me that I did not know who I was going to sell to.
I wasn’t sure whom to go to but I remembered in one of the blogs during my research, that they had mentioned that, fish farming have ready-made buyers like bars, hotels, and eateries. I decided to visit some of these places around my area and I was told that they already had suppliers, I was ready to sell at a rate cheaper than their suppliers, but found that the suppliers’ prices were even lower than what I was offering them.
I called another friend who told me to go to Makoko market, where the women buy fish in large quantities. I went there and true to his words, the women did buy fish in large quantity but buy from 700mm and below. Luckily I was able to reach an agreement and they came to pick the fishes that met their requirement; by then they had stayed an additional 3weeks, meaning more spending on feed. After disposing of my small-sized fishes, I had the table sizes left which I literally begged people to buy because I was spending too much on feed. By the time I sold all the stock, I didn’t come close to making my capital talk less of profits. I learnt my lesson the hard way which I made sure didn’t happen when I took my second stock.
HOW AND WHERE TO SELL
- There are different ways of selling your produce especially if you are into large scale production, the first thing is to join cooperatives, in cooperatives, they link you up with different off-takers who are target customers, most of these off-takers even support the farmers so it will be a good idea to always form or join cooperatives in order to reach buyers and make larger sales.
- Meeting the off-takers directly is another way of selling your produce. You approach the company and both parties come to a mutual agreement, but you get a better deal when cooperatives are formed.
- Another way is for you to locate merchants or middle-men as they are called, most of these middle-men will buy almost everything you have. but bear in mind that their prices are not usually fair.
- Open markets are another way of selling your produce, at this level you can either sell in large or small quantities. Most farmers who grow grains prefer this mode of selling, as they can decide how many bags they want to sell and save the rest for a later day.
- Storing and selling at offseason is another way of making more profits on your produce. You can consider renting a warehouse or a temporary storage area to keep your produce and sell when they are offseason. But you have to ensure proper storage to avoid pests and any contamination of the stored goods. This form of selling is what the merchants are known for, they buy from farmers at harvest at a relatively cheap price, they store in warehouses and sell at offseasons to different companies who need them
- Processing of your produce is another way of making huge money. Processed goods can give twice or thrice the number of their raw products. So, you can also consider transforming your raw products into finished products in order to make more profits. In addition, finished products have longer shelf life compared to its raw state as it would have gone through different stages of production thereby eliminating all microbial activities that could lead to spoilage.
Leaves can be dried and packaged into different fancy bags, tomatoes can be dried, frozen, made into a paste or in some cases skin removed and canned, cassava can be dried into chips or made into garri to increase shelf life. There are different ways of processing agricultural produce in order to increase their shelf lives. Just make sure you do your research first before venturing into any form of production.
- Word of mouth helps you sell, tell people around you what you produce and you never can tell who might need it. The new way of selling now is through social media (Facebook, Instagram, websites) here you can reach many people in one location with little expenses. We also have classified advertising sites (Olx, Jiji) where you post what you have to sell in most cases for free and people from all parts of the country can buy.
Marketing is an important part of a business that shouldn’t be taken for granted, most new farmers are only concerned with the farming itself and not how to sell their produce. Their main purpose of going into farming is for profits making yet they fail to take the money-making part seriously.
According to Michael Hyatt “Marketing is really just about sharing your passion”, so if you don’t share your passion or love for something, how will people know you have passion in the first place? Same for agribusiness, show and tell people what you sell or produce and make your money.