Co-Operative Marketing Ppt

Presented by:-Talha Akbar Kamal

Dept. of Agricultural Economics And Business Management

Aligarh Muslim University (UP)

Co-operative Marketing

Process of marketing through a co-operative association formed to perform one or more of the marketing functions in respect of the produce of its members.

It is voluntary business organization

established by its members to marketing farm products collectively for their direct benefits.

Co-operative Marketing

In the words of Margaret Digby, an F.A.O. expert, “co-operative marketing is the system by which a group of farmers or market gardeners join to carry on some or all the processes involved in bringing goods from the producers to the consumers”

According to the R.B.I. , “ a marketing society can be considered as a co-operative association of cultivators formed primarily for the purpose of helping the members to market their produce more profitably than is possible through the private trade”

Importance of co-operative marketing was stated as early as 1928 by the royal commission on agriculture as :A group of sellers are more powerful than an

individual seller.Educating the cultivator about:

Market demand Market pricesGrading of product

Bring producers into direct touch with the export market.

Role of co-operative marketing

Marketing sub-committee of the policy committee on agriculture, forestry and fisheries of the reconstruction committee of council in 1944 also stated , as:

Co-operative marketing is necessary for attainment of maximum efficiency.

Improve economic condition of farmers.Strengthening the bargaining power of farmers.

The U.N. also stated in one of their report, as “marketing associations are next in importance for rural prosperity to those providing and administrating credit”.

Cont….

The broad aims of co-operative marketing societies are:Rationalize the whole marketing systemStrengthen the bargaining capacity of the

cultivatorsTo eliminate the superfluous middlemenTo provide finance to needy membersTo persuade the members to grow better

quality of productsStabilize price by an orderly and judicious

supply of commodities in market

Aims and objectives

Main aims and objective in brief given by the committee, are :To strengthen the bargaining capacity of the cultivatorBetter price to producerEliminate superfluous middlemanProvide finance to membersPersuade farmer to grow better quality produceStabilize priceDevelop fair trade practicesProvide facilities of grading and transportationTo act as an agent of government

Dantwala committee on co-operative

To promote the economic interest of its member

To act as a distributive center for agricultural requisites

To help in the expansion of co-operative credit programme by linking marketing with credit.

Cont…

Economy in cost of marketingBetter priceSafeguard against price ringsCredit facilitiesSupply of quality goods to consumersHelps in growing better cropDivision of surplusEducative value

Advantages of co-operative marketing

The need for co-operative marketing in India arises from a variety of factors, those are:Defects and malpractices in the existing system of

agricultural marketingMiddlemen's charges are excessive, numerous and

variable.Excessive pressure of landlords(money lenders)Ignorance and lack of resourcesSmall holdings and scanty outputDifference in the price spread between the

producer and the consumerFluctuating prices

Need for co-operative marketing

Begin in India in 1915 in the former Bombay province at Hubli.

The second society was formed at Gadag in 1917 in the same province

Both these societies were formed by the Agriculture Department

The main objective behind setting these societies was to encourage the cultivators to grow improved quality cotton and sell them collectively.

History & growth of co-operative marketing in India

From 31 societies in 1920-21 the number moves to 142 in 1942-43 in Bombay province

In Madras, the no. moved from 2 in 1920-21 to 181 in 1943-44

In Uttar Pradesh, there were 116 marketing union

In Punjab, 37 sales societies were present in 1943-44

Co-operative marketing were also started in some other areas also, such as, Baroda , Mysore, Bengal……..etc

Growth of co-operatives

In 1945, the Co-operative Planning Committee, set up roughly one ‘mandi” for 200 villages for selling about 25% of there marketable surplus in next 10 years.

The committee also emphasize the need for an effective link between co-operative credit and marketing

Government subsidies were also be required for to minimise the managerial cost

Cont…

In 1951, the All India Rural Credit Survey committee, found the position of these societies very unsatisfactory

Although, it was satisfactory in number but contribute very less only 1% of the total sales

Cont…

1st five year plan:-No scientific targets were made‘Considered as neglected field’ by Dantwala committeeNo measures were taken to strengthen the movement.The total value of agr. Produce marketed by co-operatives was Rs 53

crore in 1955-56 as against Rs 47 crore in 1950-512nd five year plan:-

Pay emphasis on development of co-operative marketingPlan expected the organisation of 1800 primary marketing societies

and an apex marketing society in each state as a central organisation.Financial assistance from government is also given in the form of,

1. State participation in share capital2. Subsidy towards the cost of managerial staff in initial stages

Progress during various 5 years plans

1869 PMS were organised and apex marketing societies were set up in each state except J&K

A NACMF was also set up popularly known as NAFEDCo-operatives handled agr. Produce worth Rs. 174 crore at the end of 5

yr planBut nearly 50% comes from sugarcane which is legally compledBy and large co-operative marketing failed to made any substantial

impact 3rd five year plan:-

Special importance were given to integrated rural creditMain task is to strengthen the marketing structure and cover the areas

which were left in 2nd planTarget of setting up 544 new marketing societies and marketing agr.

Produce worth Rs. 360 crore in the last year

Cont…

452 additional primary societies were organised and 900 marketing societies were also set up out side the planned programme

4th five year plan:-Aims at strengthen the existing marketing societies

at primary level.Grading and pooling techniques were introducedFirst time the target of handling agr. Produce was

crossed from 900 cr. To 111o cr.Expected to increase storage capacity from 2.6

million tonnes to 4.6 million tonnesInter state disparities were continue.

Cont…

5th five year plan:-Consolidation and strengthening of existing

societiesAbout 100 new PMS were to be organised It was expected that , during last year of 5th plan

value of agr. Produced amounted to Rs. 1900 cr.Inter state trade by co-operatives expected to Rs.

80 cr. AnnuallyIn the field of exports, it was expected to come

close to Rs. 15 cr. Storage capacity would be raised to 6.8 million

tonnesUp to 1975-76 the total output market were Rs.

1128 cr. , il alone goes to Rs. 1073 cr in 1976-77& Rs. 1797 cr in 1978-79

6th five year plan:-Amount of arg. Produce marketed by co-operatives goes to

Rs. 3032 cr.Development of agr. Co-operative market is unevenAt the end of the 6th plan the number of societies were 4130The value of food grains handled by co-operatives was Rs.

900 cr.7th five year plan:-

Aim at strengthen the PMS and there activities.Proposed the effective links between marketing co-

operatives and public sector commodity co-operatives such as FCI, CCI & JCI

Close co-ordination with consumer co-operatives, civil supply co-operatives and public distribution system

It was expected that at the end of the plan co-operatives would under take the retail sale of fertilizer to the extent of 8.3 million tonnes

The value of agr. Produce marketed by co-operatives is expected to increase to 5000 cr.

8th five year plan:-76000 fertilizer retailer outlets distributing 40

lakhs tonnes of fertilizersPrice support operation were taken for oilseed,

pulses, potatoes etc360220 tonnes of onion was exportedStorage facility had to be increased to 141 lakhs

tonnes

9th five year plan:-Infrastructure has not kept pace with the

accelerated growth of productionPanchayats were proposed to take active role in

development of thisSchemes were introduce for low cost technologies

adoptionEducating the rural youth to adopt change

10th five year plan:-Strengthening of marketing with value addition

infra-structureSpecial training to farmers

11th five year plan(present scenario):-States disparitiesCrop insurance scheme was implementedLack of credit facilitiesOnly one forth of the market have proper facilitiesCold storage are requiredInformation and communication technology(ICT) is

implemented for better market information.

1. Result of official initiative2. Target hunting3. Unplanned set up4. No integration of tiers5. Weak organizational links6. Competition from credit society7. Bias towards individual member8. Poor management9. Malpractices10. Un regulated market11. Lack of supervision

Causes of poor performance

Societies should be located in the mandi centers Efforts should be made to forge an effective link

between credit and marketing Mirdha Committee on co-operatives

recommended that producer-cum-trader should not be allowed to become a member of society

Requirement of trained supervisory staff RBI should allow SBI to borrow additional fund

at bank rate for co-operatives Societies should sale their member’s produce

after grading and peocessing

Suggestions

Societies should have their own godown and govt. should provide finance for this.

Societies should have directors and managers and role of each member is specified

Societies should have bye-laws specifing do’s and don'ts of co-operatives

Special course in co-operative marketing conducted by the Committee for Co-operative Training should be more job-oriented

Cont…

Co-operation in India, by Dr. B.S.MathurNew Dimensions Of Co-operative

Management, by G.S.KamatPrinciples Problems &Practice of Co-

operation by T.N.Hajelawww.google.comwww.wikipedia.comwww.planningcommission.inwww.nafed-india.edu

Reference

Thank you

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