Local Marketing of Organic Products in Developing Countries

This checklist is meant for everybody who is interested in increasing sales of organic products in the local market. These may be farmers, farmers´ organisations, processors, NGOs, official bodies, or any party in the market chain.

As a result the objectives in increasng sales of organic products may be various and different - also the means to be applied, and consequently the questions which correspond to the individual situation. Some may be of importance, some not for a particular case. For each person or organisation concerned, each question should be answered in relation to their own situation and objectives.

1. Basic questions to be answered:

First of all, before marketing organic products, you must have a clear understanding of the concept of organic agriculture, and the rules and regulations you want to comply with. There may be generally agreed standards of production and processing, there may be “standards” in your village or defined by yourself. In any case, you have to be clear about your definitions of organic production and processing. Secondly, if you are in a group that wants to start marketing, everyone must have a common understanding:

• What does organic agriculture mean for me?

• Do we have a common understanding of organic agriculture in our group?

• Which are my/our rules or standards for organic agriculture?

2. What do I want with local marketing?

If you have some clarity about what you want to achieve with your local marketing efforts, it will be much easier for you to find the right approach and to take the steps needed to achieve your goals. Do you want to...

• Create income alternatives for producers and their families?

• Strengthen the local economy?

• Improve food security of the region?

• Become less dependent on global market fluctuations?

• Save local varieties?

3. Which products are to be marketed?

The basic question is whether you want to offer a broad assortment of different products or whether you are going to specialize on one or a few products and process them further, e.g. tomatoes, tomato-salsa, dried tomatoes, tomato concentrate, tomato juice etc. You should start your marketing initiative with something you are really good at and which you already have.

• What products do we have?

• What are my/our strengths, where are we really good at?

• Is it easier for us to offer a broad range of products or to focus on one

• product or product line?

4. How can I define the quantity to be sold?

Do you have enough product left to sell after nourishing your families and feeding the livestock? Self-supply should be assured before you sell anything.

How much do you produce?

How much of it will your family need?

How much do you need for your livestock?

Can the relations be changed?

So how much do you have left for selling?

• Total quantity produced

• How much for personal consumption

• How much for feeding of animals

• How much for others

• Quantity for sales

• Which quantity do I have for sale now to start with?

5. Which aspects of product quality have to be considered?

Quality should take into consideration consumers´ expectations which may vary.

For example, for processing, the demand may be very different than for direct consumption. Quality is a key factor of success in marketing initiatives.

• Do exterior characteristics like size, shape, color, weight match clients’ expectations?

• Hygiene?

• How fresh are the products when they reach the place of sales?

• How can I keep them fresh during sale?

• What is the nutritional value of my products?

• How do they taste?

• Are they contaminated with agrochemicals?

• Are they produced and processed according to organic rules, regulations or standards?

6. Can I ensure supply throughout the year?

Reliable delivery is an important aspect to bear in mind if we want to strengthen our relationship with our customers. Especially for fresh product this means continuous supply for as long as possible during the season. First you should get an overview of your actual production:

• What are you producing right now?

• When will you harvest?

• How much will you harvest?

You will get an inventory of your products throughout the year allowing you to see in which months you might experience shortcomings. You may be able to influence supply by means such as production planning, alternate production, prolongation of the productive season or storage.

• Period of harvest?

• Period of sales?

• Do you have storage facilities?

• How high are losses during storage?

7. Are there legal provisions whch must be respected?

Existing legal regulations have to be observed, even more, if the product is sold in more formal structures e.g. supermarkets, or for further processing. Regulations on specific hygiene rules for food, especially of animal origin must be considered, and in most countries you will need permission from the public health authority.

• Are there legal regulations regarding the product?

• Is marketing itself regulated (e.g. do product taxes apply)?

8. How can organic quality be certified?

Certifications are a confirmation for clients and consumers, that the product has been produced according to certain rules or standards. Consequently they are marketing instruments, but do not necessarily influence the intrinsic value of the product.

Although organic production has to follow carefully the stipulated rules, official certifications do not always exist. Even if they do exist, formal certification may not be necessary for all markets. In many cases there are other ways to ensure the organic character of the product.

An international IFOAM-Certification is quite expensive for farmers and only necessary if you are going to address foreign markets. In many countries there are national certification systems using internal control systems. Find out what exists in your country and try to affiliate your group if you want a certification. Too many different regulations and organic labels will confuse the customer.

• Do I need a certification of my products?

• Do I need an international certification?

• Are there national certification systems in my country?

9. How can I attract attention to my product (presentation)?

A good presentation helps to attract the comsumers´ attention and interest. If the product looks good and interesting or attractive, clients, namely consumers, will be more easily ready to try it. Nevertheless different clients and consumers may have different expectations or reactions to a certain type of presentation. Hence the presentation should be elaborated taking in consideration the client aimed at. In certain cases it may be even better to elaborate packing and label together with the owner of the point of sales, who is in direct contact with the consumer.

Packaging again is depending on the product and the market. It has to obey technical needs and serves at the same time to attract the attention of the buyer, especially in case of final consumers.

A good label is a strong eye catcher and will help consumers to remember and identify your products. Normally there are strong legal regulations to be obeyed before applying for a label.

• Which is the target-market of my product?

• Is it end consumers, supermarkets, processing industry or wholesaler?

• What presentation will be attractive for the client?

• What packaging would be attractive / desired by the client?

• Do you have a label for the products?

• Are there legal regulations / formalities to be considered for a label?

10. Transport

Transport facilities are of utmost importance for the decision on a market-place or -marketing channel. Sales are only viable if you can deliver a good quality product within an adequate time, and at a reasonable cost. Transport facilities can be very variable, depending on the distance to market, the value of the product, the quantity to be moved and roads available. When starting marketing activities, existing transport should be used. Only later on and if you have stable and profitable sales,should special transport facilities be acquired. Often, individual transport costs may be lowered by partnerships or co-operation agreements.

• What transport facilities exist?

• How much is the cost of transport?

• Can I reduce costs by sharing transport with others?

11. Diversification of products

Diversification is the key to successful organic agriculture and helps to reduce risks for farmers. If you have a diversified production, losses due to pests, diseases or climatic factors will not affect the whole production and price fluctuations on the market will certainly not affect all products. Have a look at the varieties you are producing. Frequently farmers produce some heirloom varieties in their backyards for themselves and use new varieties for marketing. But consumers often yearn for those old varieties. These varieties are usually very well adapted to your climatic and edaphic (soil) conditions and resistant to many pests and diseases. This applies to your livestock, as well. Maybe the big white chickens grow faster, but what about the cost for medicine and special food? And how do they the taste compared to the chickens your grandmother used to raise?

• Which crops am I producing?

• Can I improve diversity by introducing other crops?

• Which varieties do I use?

• Do I have heirloom varieties?

12. How can I find the right price

Setting the right price for a product is very important for sales. It may be difficult and complicated to determine it, but it is simply unavoidable for sustainable market activity. Most important is that you know your production costs, i.e. how much does the product cost you from seeding to the point of sales. Obviously, if you sell cheaper than that you are loosing money. Have a look at the market. You need to know how much is being paid currently and if the prices have been volatile in the past. You must know your competitors and their prices. There are different methods for pricing:

• Based on the market

• Competitive

• Introductory

• According to quantity

• According to region

• According to costs of production and trade

• What are my production and marketing costs?

• What is the market price of my products?

• How do prices change over the year?

• What influences the price on the market?

• How many competitors do I have?

13. Processing and product development

Product development and processing are very important factors both in diversifying your product range and in meeting evolving consumer demand. On one hand, a farmer can add value to the product by processing it on his own farm. On the other hand, commercial/industrial processing is opening the door to the purchase of bigger volumes of the unprocessed product. Co-operation is a crucial factor in both ways of product development,and at all levels. Especially for organic products processing at the farm level fits with the image of "near to nature". Yet you must be certain that all processing facilities and procedures are fully hygienic and free of any health risk for the consumer! In evolving markets for organic products sales to a processor are possible mainly in a type of cooperation, when the processor is willing to promote his products as organic. Often, to begin with, the processing of organic products will pass through a period of conventional sales, until conditions allow for an organic declaration.

Product development means both developing new products, or varying and improving existing ones. To start with, this is possible by very cheap and simple means, but may become very knowledge and cost intensive at a higher technological level. It is best to begin with what you know and what you are really good at and then you might start experimenting with small batches of modified/improved products.

• Do I want to process the products myself?

• Do I have the facilities for processing?

• Are there sanitary regulations to be considered?

• Do I want to deliver to a processor?

• Is the processor willing to promote the organic origin of the processed good?

• Can I guarantee delivery of the required volumes?

14. The placement of products

Different market channels offer different opportunities, but make different demands, too. It is not possible here to give individual or specific guiding questions for varying outlets. What we offer is a general orientation as to which factors deserve special attention. Sometimes, less sophisticated sales points, at or near by the farm may be easier to arrange. The crucial point is where a certain product or range of products fits best to the chosen sales channel.

• Where can I sell my products?

• Does a market place exist in my surroundings?

• Should I promote (with my organisation) an organic farmers’ market?

• Is there a store or supermarket nearby?

• Is there a processor or factory within reach where I can sell my product?

• Which advantages has my product in the chosen market compared to competing products?

• What are the advantages for me of my preferred sales channel in comparison to others?

• What are the problems?

• Can I ensure delivery of the required quality ?

• Can I ensure delivery of the required quantity during the whole period of demand?

• Can I ensure transport of the product?

15. Promotion of products

Promotion should be done depending on the clients you want to address. In case of sales in your own surroundings, the promotion should be as personal and direct as possible. The further the distance to the sales place, the more technical will be the means of promotion. Organic products carry an additional social value, which should be promoted in the public to raise consumers’ awareness. There are many different ways and media which can be used for the promotion of your products:

>Radio: Place advertisements in popular channels, offer to give interviews about your initiative, the organisation, organic farming, social effects etc.

>Leaflets/Flyers: distribute flyers with information about your products and/or market

>Posters: put advertising posters in strategic places, where many people will see them, maybe the bulletin board of the municipality, medical clinics, schools, pharmacies

>Direct marketing: if you organize a farmers’ market show the farmers how to deal with people, how to answer questions about organic farming, how to pro-mote the products

>Field days: organize field visits for your customers, so they can see where the products come from

>Samples: offer samples to taste – slices from an apple, a cup of yogurt, some bread with home-made marmalades

>Fairs: participate in food fairs, this will help you contact other organisations, get an overview of the market, get in touch with purchasers of supermarkets or processing industries

• Who do I want to address?

• How can I reach them, using which media?

• What do I want to tell my clients?

• What do my clients want to know?

• How can I reach their hearts?

• Is the content of my information true?

• Is the content of my information understandable?

• Is the presentation attractive?

• Will the clients recognize my product?

• How can they recognize it?

• How can I convince them about the organic quality of my product?

• Do I need an external proof (organic seal or certification)?

• For which clients do I need a certification?

• How can my clients try my product?

• Is there existing consciousness already about organic production and organic products?

• How can I relate to the existing knowledge about the value of organic products?

• Can I gain co-operation in increasing public awareness?

• With whom can I cooperate in educating consumers about organics?

• Are there regulations regarding public advertisement?

• Does my client have special regulations for creating and designing of information for transmission?

• How long do I plan to engage in promotion?

• How much will it cost?

• How much work do I have to invest?

• Is there anyone to help me?

• Can I afford professional help?

• Can I get someone else to pay for publication?

16. Co-operation with other producers

In an emerging market - as the market of organic products - co-operation is an important tool to gain a market share, but also to overcome the shortages of the beginning. Later on co-operation gives additional possibilities and areas of action for further growth and development. Co-operation can help to succeed on all levels of the market chain.

In the majority of cases an individual small producer is not able to respond to the needs of commercialization. Quantity of product to be sold, information and orientation to be collected and used, logistics of warehousing and transport, confection and distribution of promotion materials, finally money to afford the costs, especially in the beginning - in nearly all areas a strong co-operation and organisation is of help. Even small farmers organisations may need to cooperate in order to have more possibilities to act in the market. Front of this background, each of the above mentioned aspects should be examined under the question whether the farmer or group is strong enough to respond, or should look for cooperation. Thus the following questions are not meant to identify areas of cooperation, but to foster the co-operation especially of producers.

• In which subject do I need co-operation with others?

• What exactly do I want to achieve with the cooperation?

• How many people should act together or participate in order to reach the

• objective?

• How shall we organize the group?

• Who will take over which responsibility?

• What is the common objective?

• What is the contribution of each member?

• What are the expected outcomes?

17. Co-operation with trade

To reach efficient sales a good co-operation between producers and distributors is necessary. Producers need the security for the sales of their products, distributors - shop owners, supermarket managers, processors - need the reliable provision with goods. Sustainable development of the market needs fair trade relations.

• Can we meet the quality demands?

• Can we guarantee continuity in product supply?

• Is the price fair to producer and buyer?

• Is delivery in time secured?

• Is payment in time secured?

18. Culture and gender are important aspects of marketing -

which have to be considered in particular?

Organic agriculture as a sustainable production method is widely related to traditional production, and thus to the culture of the population. However, in many cases women are the ones who produce and market organic products, especially, if these are coming from horticulture or keeping of small animals, but also in case of home processed products.

• How do women participate in the process?

• Who is in charge of the additional workload?

• Which effect does it have on household income?

• What is the additional income used for?

19. Integration of other stakeholders

Further development of the local market for organic products needs the co-operation of as many stake holders as possible.

Co-operation on different levels and with actors who have different points of view can help to gain more attention in the public and to develop new concepts for marketing. It also helps to join knowledge and forces and to reduce cost.

Identify possible stakeholders who might support your activities. What might be their interest in the process?

• Traders: are they interested in a new product line for diversification and to increase sales?

• Processors: are they looking for reliable sources of high quality ingredients of their products?

• NGOs: are they looking for good projects to support?

• Science and investigation: they might want to do research on the social or health effects of your initiative – this would add to your publicity

• Banks and financing agencies: do they offer small funding opportunities?

• Press: ask them to grant you a column, page or section where you can report on your initiative, organic products, healthy nutrition

• Political decision makers: their support for your initiative can raise public aware-ness