To Market, To Market – Episode 4 : Marketing: Calculating your Costs

Marketing and market information

Notes to broadcasters

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This is part four of a five-part series about understanding and using market information. With accurate market information farmers can decide what crops to grow, and where and when to sell in order to get the best prices.

Ideally these programs should be run as a series, for example, once a day for five days or once a week for five weeks. The cast of five characters continues throughout the series, although not every character appears in each scene.

In this episode, listeners learn the importance of considering costs when they are deciding how to market their crops. High marketing costs will reduce a farmer’s profit. It is even possible that a farmer will lose money if marketing costs are too high. Possible marketing costs include: packaging and handling, transportation, crop losses, money spent on meals while marketing, and any fees, commissions and unofficial payments that are required in the process.

Script

Characters:

Bakari:
Farmer (aged early 30s)
Isoke:
Farmer, Bakari’s wife (aged early 20s)
INTRO

THEME MUSIC AND HOLD UNDER ANNOUNCER (5 SECS). FADE OUT.

Host
-Today you’re going to hear Part 4 of “To Market, To Market,” the series about understanding and using market information. Today, farmer Bakari and his wife, Isoke, try selling their produce at the urban retail market, hoping to get a higher price than the trader is offering. The results are not what they expect.

FADE OUT THEME MUSIC.

Bakari
-(tired) Isoke, we’re finally home. Travelling to the city market was more difficult than I expected.

Isoke
-Yes, lifting those heavy baskets made my back ache.

Bakari
-The problem with selling at the city market is that people buy such small amounts. We didn’t sell all our grain. In fact, I don’t know whether we made more than we would have by selling to Tabansi.

Isoke
-What? But we received a much better price for our produce.

Bakari
-True. But don’t forget it cost us a lot of money to travel to the city. Two bus fares. And the cost of lunch at the bus terminal.

Isoke
-But our profit must be high, all the same. The selling price was quite high and we were working for ourselves and not giving any profit to Tabansi.

Bakari
-Let’s not worry about it yet. First we should go inside and make the calculations.

MUSICAL BREAK (5 seconds).

SOUND OF COINS DROPPING INTO A CAN.

Isoke
-(counting money) Thirty-four, thirty-seven… Oh no! Bakari, you were right. We made less than Tabansi was offering us.

Bakari
-(calmly) Well let’s try to stay calm and think about why we lost money.

Isoke
-I just don’t understand it. We got such a high price at the city market. And we didn’t have to pay any trader.

Bakari
-Yes, but we had a lot of expenses when we travelled to the city. First we had to pay two bus fares – yours and mine.

Isoke
-Yes, you said that before. And our lunch.

Bakari
-And we paid for our bags to go on top of the bus and a fee for the market stall. Also we had to buy plastic bags for the customers to carry their produce in. All these expenses add up. And, we have also lost a day’s work here at home.

Isoke
-I thought we would make a profit because we would get a higher price at the city market. But really we should have checked all the possible expenses before we decided to go there.

Bakari
-Well, we still have some grain to sell. Next time we must remember that there are many costs to calculate before we decide how to sell it. If we pay too much for handling and transportation, then we lose money. Next time we will consider all the costs of marketing before selling.

EXTRO

Host
-You’ve been listening to the serial drama called “To Market, To Market” (Insert name of performer) was Bakari and ________________ was Isoke. Bakari and Isoke learned that there are many costs to consider when marketing produce. Sometimes expenses are higher than earnings. As a farmer, try to remember all costs such as transportation, supplies, and extra fees before you decide how to market your produce.

Acknowledgements

Contributed by Christine Davet, Toronto, Canada.

Reviewed by Andrew Shepherd, Agricultural Support Systems Division, Food and Agriculture Organization (FAO), Rome.

Information sources

Understanding and using market information, by Andrew W. Shepherd, 2000. Agricultural Support Systems Division, Food and Agriculture Organization, Viale delle Terme de Caracalla, 00100 Rome, Italy. E-mail:AGS-Registry@fao.org.