Finding a market
Markets are important because they help farmers sell and earn money for their business.
As a farmer, you must establish how you will sell your produce before you begin to plant or grow anything.
There are 4 important things to consider when finding markets. These are the 4 P’s:
This is what you decide to sell after studying the market. When planning what commodity you want to produce, think about the following:
- What are others producing?
- Is there a demand for your product?
- What does the market want? What quality expectations are there in the market place?
- What costs are associated with marketing your product?
- What legal requirements are to be met? For instance, you cannot hawk milk without a permit.
It is important for you to plan production, establish the level of investment needed throughout the season, build the necessary crop/animal husbandry, identify the inputs required and know the estimates of income you will get in order to be efficient and have a successful business.
You need to figure out what price you are going to charge.
- Will you charge the same price for everyone?
- What will you do if a competitor comes along?
- Does it cover your production costs and leave me a profit?
- Are there different prices for different grades?
- Can you make a profit? Remember, you can make more if you sell a lot at a lower price than if you sell a little at a high price.
Find out what the quality expectations by the market are to minimize produce rejection or price changes as well as the costs associated with selling and the logistics involved in delivering goods to market.
You need to plan on where you will sell your product as well as how you will deliver your product to your customers.
There are 2 main marketing channels for farmers like yourself to sell your products:
These are the easiest forms of markets to access. They include farm gate and road side sales, village markets, rural aggregation points and sale in urban areas wholesale and retail markets for instance ‘mama mbogas’, schools, small hotels and eateries.
These are more structured and are suited for commercially oriented farmers to large commercial buyers usually on contracts.
Smallholder farmers can link to a consistent source of income, market information and support services. Such markets include contract farming for export, aggregators, supermarkets, high end green grocers, hotels, processors etc.
Brokers, middlemen and aggregators do play a role in aggregating for formal markets. They tend to know what the market wants and are keen on quality.
Other forms of formal markets include government strategic reserves like National Cereal and Produce Board.
Formal markets demand that farmers comply with strict quality standards, regular volume requirements and fluctuating prices.
Lastly, if no one knows about your product, you can’t expect to sell anything.
You need to think about how you are going to tell people about the benefits of your product or service.
One way of creating awareness about my produce is using social media to advertise. It won’t cost you much or nothing at all.
Online services such as OLX Kenya, Mkulima Young, Farm Soko and SokoPepe are good platforms to advertise your produce.
You can also talk to brokers and visit potential buyers you have identified.
Some farmers also rely on word of mouth. This is when people tell others about your product or service. This is a good way to promote because people trust the information they get from friends.