The fresh produce market as a channel offers producers several options and opportunities. These benefits drastically decrease, however, in the absence of careful planning.
- This article was written by Prof. A. Leonard and Dr. J. Range.
Planning around marketing options realise a higher level of success, provided it’s done in good time and not when the product is ready to go to market. Here follow a few guidelines producers should consider when planning their marketing.
There are a series of national markets that function around the same regulatory principles. When a producer sends any product to a fresh produce market, the delivery, sales and payment processes are the same, regardless of the agent or sales person it’s delivered to. The same counts for general procedures, information and rules. This provides producers with uniform, predictable and convenient marketing options across the whole of South Africa.
All producers deliver products to commissioned agents enjoy the same protection under Law 12 (Agricultural Produce Agents Act, 12 of 1992) as regulated by the Agricultural Producers Agent’s Council (APAC). This protection applies regardless the size producer’s size, or the amount of product delivered during the season.
South Africa has some of the most progressive legislation when it comes to the protection of the producer’s interests within commission-based business models. The registrar’s mandate as contained in Law 12 is executed actively and effectively on a daily basis.
Producers are encouraged to familiarise themselves with Law 12 and associated rules and regulations. Visit https://www.apacweb.org.za or contact the registrar directly on 011 894 3680 or Francois@apacouncil.co.za.
Market information is transparent and available to producers free of charge. This information includes detailed transactional and payment information (volumes, price, cancellations, gradings) on all consignments delivered by a specific producer. The producer also has access to daily average prices and volumes traded on markets. The producer can request this information directly from the market authority and/or the relevant agent. There are also various online options where information can be found.
Sales persons marketing products for commission on behalf of producers must have a valid APAC certificate, and must be registered by the market authority (if this person physically trades at a market). The agency he or she is employed by must also hold APAC registration. Producers are encouraged to ask for proof of said certificates prior to deliveries.
Knowledge on specific markets and local buyers is extremely important when making marketing decisions. Whether the agent’s knowledge on local sales trends are core to the sales service delivered, it’s advisable for producers to, on occasion, visit these markets themselves. Interaction with large and small buyers offer a valuable opportunity to change perceptions about the producer’s trademark first-hand.
South African producers are privileged to have a variety of competitive options available to them from the farm gate. By ensuring that the producer isn’t trapped in one channel, the development and management of different alternative marketing channels is important. This includes export agents, direct trade, local retail, and, of course, national markets. South Africa is one of a few countries where the producer can market as much as 100% of his or her products via different, sophisticated and competitive marketing channels, each with their own dynamics.
The above-mentioned represents a few of the aspects of the complex marketing process by fresh produce markets. The fresh produce channel’s diversity and competitive nature are characteristics that offer success to producers that invest the necessary time, and that grab the available opportunities.