Research Reports
A Study on Success Factors of Farmers' Marketing Organizations
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AuthorGouk, Seungyong
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Publication Date2008.11.01
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Original
The purpose of this study is to find out success factors of farmers' marketing organizations such as agricultural cooperative and "agricultural firm" which means a firm managed by farmer, and to suggest development strategies for farmers' marketing organization. There are 1,196 agricultural cooperatives and 624 marketing agricultural firms in Korea, but large numbers of them are lossmaker. Korean government has designated some superior organization to "specialized marketing organization" and intensively supported them. By 2006, 289 agricultural cooperatives and 94 agricultural firms are designated to specialized marketing organization. And government annually evaluates their management performance.
To find out success factors of farmers' marketing organization, government's evaluation data are used. First, we divided those data into agricultural cooperatives and firms, and conducted cluster analysis to distinguish successful marketing organization from each data sets. And then logit regression analysis was conducted against whether certain organization is classified to successful organization or not.
In case of agricultural cooperatives, it was found that possibility of success is tends to be higher when it deals specific item such as apple, mandarine, and share of fruits is increase. In case of agricultural firms, it was found that possibility of success is tend to grow when is has more asset, the buying - not on consignment - portion of agricultural product from farmers is increase. Additional survey of 234 organizations and visit interview of 10 successful organizations show that quality control, research and development, human resource, and support of local government are also important factors of farmers' marketing organization.
As a result, we could find that success factors vary with the type of organization such as cooperative and firm. So targets, strategies, approaches, and support policies will be varied according to their type of organization. And when a marketing organization focus on special item, it can get competitive advantages more effectively. To correspond with price volatility of agricultural product, marketing organizations have to diversify their collection system, such as pooling practice, forward contract, and so on.
Researchers: Gouk Seung-Yong, Choi Byung-Ok
E-mail address: gouksy@krei.re.kr, bochoi@krei.re.kr
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