Articles
THE ROLE OF THE LEAD FIRM IN LINKING FARMERS TO MARKETS: A PNG CASE STUDY
Article number
895_21
Pages
167 – 175
Language
English
Abstract
There are a number of ways in which farmers can be linked to markets and much effort has been directed at interventions that can assist this process.
Linking farmers to markets via private sector mechanisms is one such method.
In order to better understand how such linkages can impact on farmers and their livelihoods, focussing on the strategies that may be employed by marketers in their endeavour to become, and remain, viable business entities, would be useful.
This paper reports on the results of an in-depth case study of a small domestic marketer in the Highlands of Papua New Guinea, who specialised in the marketing of a high-value perishable crop and linked farmers to markets without any intervention or assistance.
The marketer was the lead firm in this chain and his strategy was analysed from this perspective.
He employed a very sophisticated marketing strategy based on market segmentation and risk mitigation, and margins along the chain were finely balanced.
He operated in different market segments that required different product attributes, relating primarily to quality, quantity, timing and continuity of supply.
His relationships with the buyers in the different segments were associated with slightly different levels of commitment.
He had three sources of supply and his level of commitment to each of these supply sources also varied.
This focus on the marketer as the lead firm and then analysing relationships with farmer suppliers from this perspective allowed some interesting insights to emerge that can add to the debate on linking farmers to markets through private sector mechanisms.
Linking farmers to markets via private sector mechanisms is one such method.
In order to better understand how such linkages can impact on farmers and their livelihoods, focussing on the strategies that may be employed by marketers in their endeavour to become, and remain, viable business entities, would be useful.
This paper reports on the results of an in-depth case study of a small domestic marketer in the Highlands of Papua New Guinea, who specialised in the marketing of a high-value perishable crop and linked farmers to markets without any intervention or assistance.
The marketer was the lead firm in this chain and his strategy was analysed from this perspective.
He employed a very sophisticated marketing strategy based on market segmentation and risk mitigation, and margins along the chain were finely balanced.
He operated in different market segments that required different product attributes, relating primarily to quality, quantity, timing and continuity of supply.
His relationships with the buyers in the different segments were associated with slightly different levels of commitment.
He had three sources of supply and his level of commitment to each of these supply sources also varied.
This focus on the marketer as the lead firm and then analysing relationships with farmer suppliers from this perspective allowed some interesting insights to emerge that can add to the debate on linking farmers to markets through private sector mechanisms.
Publication
Authors
S. Martin, A. Jagadish
Keywords
linking farmers to markets, lead firm marketers, agribusiness supply chains, vegetable chains, Papua New Guinea
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