If you want to find out the answer to this question, “Why competition is so important in food and agricultural markets” then at first you have to know what is competition?
Competition means “do something better or new than your competitors”. Besides, competition plays important roles in our life as well as the market economy. It also helps our economic progress. Competition in the food and agricultural market is ignored because of a lack of awareness of food security. Now there are lots of producers and consumers who are aware of their health and they want better and nutritious food which raises competition in food and agricultural markets. The lack of competition impacts the effectiveness of food and agricultural markets. However, enhance yourself by learning market leader strategies.
Sometimes, competition answer some basic question-
- What to produce?
- Taking a decision on How to produce?
- How much to produce?
- It is a matter of concern on How to distribute?
Having a competition, buyers and sellers enjoy a set of prices that influenced their buying behavior. At present, food and agricultural markets are perfectly competitive because there are so many homogeneous products to produce. There are also many sellers and buyers existing in this market both are well informed about the quality and price. The food and agricultural markets are getting popularity because it opens for all. Everybody can freely enter and exit in this market. Existing so many sellers, large firms does not exercise its power in this market in demand and supply. That is the major characteristic of these markets. In these markets, market prices can change because of supply and demand. Explore – Consumer interpretations of price.
However, Agricultural products like –
- feed grains,
- soya beans,
- and oil
All are collected from agricultural brokers. These brokers supply agricultural goods all over the country. Farmers bring their crops to the brokers. Besides, they receive a little amount of payment from brokers. Brokers sell at a high price in the market. But the worldwide market set the price for the respective goods. Our government also interferes in case of price setting. Learn more about – price-quality relationships.
Cattle and animals are marketed in a different way. Here, suppliers or brokers collect these cattle from farmers, and then they come into the market for selling. Sometimes, many companies or restaurant owners collect this from farmers directly. Large animals are sold in auctions. Sometimes, different types of fair arrange for this market. They aggressively marketing this like – listing of cattle, prices list, click a good picture, give a name or create a brand for this. The higher price giver will win these auctions. So, gathering knowledge on – Price is a part of the marketing mix.
In the food and agricultural markets, both the buyers and sellers enjoy freedom. This is the center of these competitive food markets. These freedoms are –
- Consumers freely choose whatever they want to eat
- Freedom to choose the seller
- New firms can easily enter into this market
- Farmers make the decision whatever they want to produce
- Both buyers and sellers have bargain power
- Mutually exchange of goods
After knowing the fact related to this food and agricultural markets, you can easily learn why competition is so important in food and agricultural markets. Let’s explore – marketing strategy.