Importance of middlemen for your business

“We can eliminate middleman but we cannot eliminate the tasks of the middleman.”

This is frequently possible to eliminate the middlemen. But we can’t avoid the functions of the middlemen. In a general sense, eliminating middlemen means the transfer of marketing activities to someone else who can perform the tasks as like middlemen. Let’s see an example –

Suppose, you are a farmer and you have no middlemen for selling your goods. In that case, you have to manage storage, transportation, financing and selling your goods directly to the customers. Here an important should be noticed that there are no middlemen for selling your goods, you sold it directly by managing transportation, storage, and many other marketing costs. These activities are done by the middlemen. But here you alone do this. So, it proved that you can’t eliminate the tasks of middlemen.

Besides, food consumers can eliminate retailers by purchasing goods from producers or wholesale food outlets directly.  But doing so, the consumers have to do some retailing function like storage, standardization and transportation and the producers or wholesale outlet will provide fewer services. So the most important thing is that the cost of marketing function can be reduced but the marketing functions can’t be eliminated from the marketing process.

These marketing function can be done by everyone from anywhere in the world. Alternatively, all marketing function can be done by a single firm. It means that they have total control of the food from farm to fork.

On the other hand, there are some specialized industries that are willing to perform some specific marketing function like transportation, grain brokers, and speculators. Crops and grains are shipped to the market direct from the farm or it may store for the later season. There exist some traditional combinations, placement, and timing of the food marketing functions. The food producer performs some tasks like storage, processing, and transportation; these are an integral part of farming.

There are two major key issues that are-

  • Whether the necessary number of functions is being performed or
  • Whether these functions are being performed in the most efficient manner.

This is because every function of marketing adds value as well as the cost to food products. Truly saying minimizing the marketing functions is not our ultimate goal. From a different point of view, the additional functions and services should be performed until the cost exceeds the values of the functions. The marketing decision making is also very important because a good decision helps to reduce cost. For that, some specialized and multifunction firms are always ready to help us through their most efficient performance.

Traditionally, the farmers are worked more they gain little. This happens because of having too many middlemen between producer to customer. So the greatest shares of the profits are gone to the middlemen. As a result, the farmers are the ultimate sufferer.

At present, the farmers have the opportunity to eliminate middlemen. But still, they have a lack of enough knowledge about it. If they get proper guideline or training, they can enjoy much.

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