Study of mango marketing system in selected districts

of Sindh province, Pakistan

M.I. Kumbhar, M. Joyo, M. Memon, A.A. Khooharo and A.S. Kumbhar
Sindh Agriculture University (SAU), Tandojam, Sindh, Pakistan.

Abstract
The present study was conducted to examine the marketing systems and
margins earned by mango growers in selected districts of Sindh Province by using
primary data. The data were collected from 100 randomly selected farmers and 50
randomly selected traders. Out of 50 traders, 10 were contractors, 20 were
middlemen and 20 were retailers. Data were collected during June 2014. A
comprehensive set of questions was prepared and pre-tested before interviewing the
selected respondents. Question subjects included marketing mango and production,
marketing cost incurred by various agencies, price of mango paid and received by
various middlemen in the system, flow of information technology, services provision
and problems faced by mango growers/producers. The study also considered mango
markets, farmers facing problems in processing of fresh fruits and getting market
information, and extension services ability to advise producers on changing needs of
markets. The results revealed that the maximum average gross income (Rs. 850,500)
acre-1 was recorded from Tando Allahyar district, which is based on Rs. 582,534 acre-1
average cost with an input-output ratio of 1:1.046. Mango contractors’ seasonal
margins were abnormally high (53%) compared with those of producers (25%). Sixty
percent of mango growers were unaware of fruit quality standards required for
export. Unstable price of mango was the highest ranked problem followed by lack of
education in marketing systems in the study area. The study recommended that
public and private extension should concentrate on training regarding the marketing
value chain. Establishment of processing and cold-storage plants in the intensive
mango growing areas to support and ensure fair prices to the farming community of
Sindh province of Pakistan was also recommended.

Keywords: marketing channels, trader, retailer, wholesaler, consumer, contractor

INTRODUCTION
Mango (Mangifera indica L.) is one of the important fruits of Pakistan and is the
second most frequent fruit grown after citrus in Pakistan. It occupies 14% of the total area
(734.6 thousand hectares) under all fruit cultivation (GOP, 2013). Of a total area of 103.1
thousand hectares under mango cultivation in the country, 52.66% is in Punjab, where
Multan and Bahawalpur Divisions are the predominant mango-growing districts. The area
under mango cultivation in Sindh is 45.68% of the total area of mango cultivation in the
country (GOP, 2013).
Mango ‘King of fruits’ is one of the two most delicious and admired tropical fruits in
the world along with pineapple and it is also considered a major fruit crop of various
countries such as Philippines, Mexico, India, Brazil, Pakistan, China and Thailand. A number
of fruit varieties are produced and exported by Pakistan but among these fruits, mangoes
have central position due to their taste, color, area, production and export (Shafaqat and
Zahid, 2004). Mango is a highly nutritious and healthy fruit containing rich quantities of
prebiotic fiber, vitamins A and C along with smaller quantities of Vitamin B, proteins and
minerals. Pakistan is the 6th largest producer of mangoes. In Pakistan, ‘Chaunsa’ and ‘Sindhri’
are the two important mango cultivars used for making pulp. The total annual production of
mango in Pakistan is around 1.6-1.8 million tons, out of which 0.6-0.7 million tons of
mangoes come from Sindh (40%). The average export price of mangoes from Sindh is over

Acta Hortic. 1183. ISHS 2017. DOI 10.17660/ActaHortic.2017.1183.56 395

Proc. XI International Mango Symposium
Eds.: I. Bally et al.
around $360 ton-1, while carefully processed and packaged mangoes from other countries
conveniently fetch more than $1000 ton-1 (SEDF, 2014). Mangoes should be transported
within 12 h to cold storage or a processing plant in order to prolong shelf life and preserve
quality (SEDF, 2014).
Although there is a lot of potential for exporting mango from Pakistan, only a nominal
amount is being exported (Khan et al., 2008). Mango export in Pakistan is only 6% compared
with other top mango-producing countries like Brazil and Mexico exporting 12% and 14% of
their total production, respectively (FAO, 2007). The mango export system in Pakistan is not
efficient or systematic to an extent where the full potential of the mango economy can be
utilized (Ghafoor et al., 2010). Most of the efforts to export mango are by private individuals
who do not greatly use centrally organized platforms. These progressive exporters, having
large financial resources, personal contacts with importers, enhanced supply source,
informative knowledge and better export management practices, are in a position to exploit
the opportunities in the international mango market but most exporters suffer due to the
poorly organized mango export system. The majority of the established exporters have their
setup in Karachi and purchase fruit from Punjab and Sindh before preparing it for export in
their processing centers. They use their own brand name and packaging material. In the
absence of an established common platform, some of the seasonal traders have also entered
into this business. Dreaming of high profits in a short duration, they often use some
unethical means in their export businesses, which gives a bad name and reputation to
Pakistani exports.
Marketing plays an important role not only in stimulating production but also in
accelerating the pace of economic development (Ghafoor et al., 2013). An efficient marketing
system usually ensures a greater producer’s share in the form of money or fruit yield,
reducing the number of middlemen and restricting the marketing charges and malpractices
during marketing of farm products (Matin et al., 2008). It is, therefore, essential to explore
efficient marketing channels and to advise producers of the best channels for obtaining
optimum prices for their farm produce. So far, research related to mango marketing in
Pakistan is scanty. This study was, therefore, undertaken to analyze the mango marketing
system and constraints faced by the farmers regarding mango marketing in selected districts
of Sindh, Pakistan, with the following objectives:
• To find out the socio-economic factors and demographic characteristics of the
mango farmers, contractors, middlemen and retailers.
• To examine different channels related to the mango marketing system.
• To make recommendations for deducing the constraints/obstacles faced by the
mango growers.
• To come up with appropriate measures to improve the existing marketing system
for mangoes.

RESEARCH METHODOLOGY
The present study was conducted in Mirpurkhas, Tando Allahyar, Hyderabad and
Matiari districts of Sindh province of Pakistan (Figure 1). The districts were selected
purposively on the basis of maximum area under mango cultivation in Sindh province.

Selection of sample and sampling technique

Sampling is the most important part of survey research. A sample of
farmers/producers and traders from different stages of mango marketing was considered as
the population of the study. A total of 100 farmers and 50 intermediaries/traders were
selected for the sample.

1. Selection of farmers.
Twenty-five farmers were selected randomly from each district, namely Mirpurkhas,
Tando Allahyar, Hyderabad and Matiari, making a total of 100 farmers. However, more small-
scale producers/farmers were sampled during the survey due to the fact that the majority of
the mango producers are small-scale farmers.

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Figure 1. Map of Sindh province showing study area.

2. Selection of intermediaries/traders.
A total of 50 intermediaries were purposively selected for study purpose. During the
sampling, a list of all major markets in the selected districts was obtained and the sample
selection was done regardless of area of the province. Five major markets (Mirpurkhas,
Tando Allahyar, Matiari and Hyderabad) were selected across the province. Within the
selected markets, a sample of 10 contractors, 20 middlemen and 20 retailers were randomly
selected with a total sample size of 50 vendors.

Data collection
Both structured and un-structured interviews were used to collect data on both
qualitative and quantitative information. The structured interviews were carried out with
the help of two questionnaires: producers/farmers and traders/intermediaries. The
questionnaire for producers was administered to both small- and large-scale producers to
obtain information on the socio-economic characteristics of the farmers, marketing system
and constraints. The questionnaire for the mango traders/intermediaries was administered
to contractors, middleman and retailers to obtain information on market outlet and
distribution channels of mangoes.

Data analysis
Data collected from the field were verified to avoid errors by checking consistency and
correct data tabulation methods suitable for data analyses. A list of tables was prepared in
accordance with the objectives of the study. Means and percentages were the major
statistical tools employed to show the results in a comprehensive manner. Costs and margins
of the intermediaries were calculated and presented in the form of tables.

RESULTS AND DISCUSSION

The data (Table 1) show that about 35% of the small-scale farmers and traders were
youth, having an age between 26 and 35 years, while 28% of the respondents were in the

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age group of less than 25 years. The finding also showed that 57% of the respondents were
married; a large percentage (40%) maintained a range of small farms having land holding of
between 6 and 12 acres. The level of education of the respondents showed that 45% of them
had their primary education, while 28% had secondary school education. In addition, the
findings showed that 47% of the respondents had experience of between 6 and 10 years;
however, 31% farmers had experience of more than 11 years.

Table 1. Distribution of personal and socio-economic characteristics of the farmers.

Number of respondents Total
Socio-demographic Producer Contractor Middleman Retailer
characteristic n=100 n=10 n=20 n=20 n %
F1 (%) F1 (%) F1 (%) F1 (%)
Age group (years)
Young (<35 years) 30 30 2 20 9 45 12 60 53 35.33
Middle age (36-50 years) 60 60 3 30 7 35 4 20 74 49.33
Old (>50 years) 10 10 5 50 4 20 4 20 23 15.33
Level of education
Illiterate 35 35 2 20 3 15 3 15 43 28.67
Primary education 40 40 5 50 6 30 12 60 63 42.00
Secondary school 25 25 3 30 11 55 5 25 44 29.33
education
Experience
Less than 5 years 15 15 2 20 12 60 11 55 40 26.67
6 to 10 years 55 55 3 30 3 15 5 25 66 44.00
More than 11 years 30 30 5 50 5 25 4 20 44 29.33
1Frequency.

Mango marketing channels

Mango trade is a seasonal business. A large number of seasonal and small traders
operate in the trade. The typical model of mango marketing channel observed in the study
area is shown in Figure 2. The mango marketing channels start from the producers. The
producers, sellers and various intermediaries form linkages in the channels. Mango
producers sold the largest portion of their mangoes, i.e., 50%, to commission agents
followed by 30%, 15% and 5% to exclusive retail outlets, entrepreneurs and exporters/SMG,
respectively, in national and international markets. In reality, marketing channels are the
optional routes by which products flow from producers to consumers (Kohls and Uhl, 1980).
In a study of mango marketing systems in some areas of Bangladesh, efficient marketing was
accomplished by the farmer-retailer followed by the consumer (Matin et al., 2008).

Absolute cash margin

The absolute cash margin indicates that contractors received the largest margin
(53.8%) (Table 2). This may be because they bear the highest costs and most risk among all
marketing agencies. Contractors lease the mango orchards at the time of flowering. This is
exactly in line with the studies carried out by Khushk and Smith (1996). They also reported
the highest cash margin of 43% by contractors. If we consider the risk factors such as high
product variation, bad weather, insect attack and disease incidence, high transport costs and
output spoilage during transportation, then this margin may be high. The second
intermediary earning the highest profit (30% of the purchase price) was the retailer. The
retailer normally buys a quantity easily disposed of in one day. The investment is relatively
low but there is a risk that it may be impossible to sell the whole quantity. In a study on
marketing structure of mango in the Philippines (Agricultural Marketing Statistics Analysis
Division, 2002), only farmers and traders involved in producing/trading mangoes were
interviewed. The marketing margins achieved in three respective mango areas (i.e.,

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Pangasinan, Guimaras and Iloilo) were higher by traders (62.80, 47.68 and 59.83%) than by
farmers (37.20, 52.32 and 40.17%).

Figure 2. Model of mango marketing channels.

Table 2. Absolute cash margin of producer and market intermediaries.

Early season Mid-season Late season Whole season
Market agency
(Rs. kg-1) (%) (Rs. kg-1) (%) (Rs. kg-1) (%) (Rs. kg-1) (%)
Producer 4.15 4.15 4.15 4.15
Contractor 5.54 (33.5) 4.46 (7.5) 9.15 (20.5) 6.38 (53.8)
Commission agent 1.08 (11.1) 0.92 (10.7) 1.46 (11.0) 1.15 (10.9)
Wholesaler 1.54 (14.3) 1.23 (12.9) 2.31 (15.7) 1.69 (14.5)
Retailer 3.85 (31.3) 3.08 (28.6) 5.23 (30.6) 4.08 (30.5)
Retail price 16.16 13.84 22.30 17.45

Marketing margin of intermediaries

The marketing margin of an intermediary is considered the difference between the
purchasing price and the selling price. In this study, the marketing margin of each
intermediary was estimated by deducting the purchase price of mango from the sale price
while the profit component was estimated by deducting the marketing costs from his share
of the marketing margin. Marketing margins of the intermediaries under the following
channel were estimated.
The data in Table 3 show an average producer's production cost of Rs. 655 40 kg-1 and
an average sale price of Rs. 3200 40 kg-1 of different varieties. The gross marketing margin of
the producer was Rs. 810 and the total marketing cost was Rs. 209;, therefore, their net
marketing margin was Rs. 601 40 kg-1 of mango. The percentage margin of the producer was
41%. The wholesalers purchased mango at Rs. 2800 40 kg-1 and sold the same amount at Rs.
2000. The gross marketing margin for wholesalers was Rs. 978 40 kg-1. The total marketing
cost incurred by wholesalers was 345 40 k-1g and, therefore, the net marketing margin for
wholesalers was Rs. 633. The percentage of marketing margin of the wholesaler was 19.94%.
The retailers purchased mango at Rs. 2931 40 kg-1 and sold the same at Rs. 3200. The gross
marketing margins for retailers were Rs. 3200 40 kg-1. As they incurred a marketing cost of
Rs. 380 40 kg-1, they earned a net marketing margin of Rs. 689 40 kg-1. The percentage
margin of the retailer was 17.22%. Pakistani mangoes are generally sent to the EU and the
Middle East, which are considered as high-price markets. Nonetheless, among mango export
countries, Pakistan fetches the very lowest returns (0.30 USD kg-1) for its mango (Collins et
al., 2006).

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Table 3. Marketing margin of intermediaries.
Average sale price Average production cost Percentage of
Respondent
(Rs. 40 kg-1) (Rs. 40 kg-1) margin
Retailer 3200 655 41.00
Wholesaler 2800 495 19.94
Producers 2100 1031 17.22

The constraints faced by farmers and traders are presented in Table 4. The problems
were categorized on the basis of priority ranking. The 12 problems identified by farmers
included lack of knowledge of how to produce export-quality and first-grade fruit, followed
by lack of extension services and lack of accurate marketing information. Traders found
unstable price was their highest ranked problem, followed by the lack of market information
and electric load shedding for processing. Pakistani mango should be given a top priority for
marketing. Among different marketing attributes, the most important ones relate to the cost
of mango and retailer cleanliness (Badar et al., 2015).

Table 4. Constraints faced by the respondents while marketing mangoes.

Problem Percentage Rank
Farmers (n=100)
Lack of knowledge to produce quality fruit for export 60 I
Lack of extension services 50 II
Lack of accurate marketing information 48 III
Lack of processing units for fresh fruit 45 IV
Lack of appropriate marketing 40 V
Lack of storage facilities 40 VI
Lack of knowledge on packaging 40 VI
Lack of postharvest management practices 35 VII
Lack of knowledge on best agriculture practices 30 VIII
Lack of technical know-how on grading 30 VIII
Strike/political unrest 30 VIII
Inadequate transport facilities 25 IX
Traders (n=50)
Unstable price 80 I
Lack of market information 85 II
Electric load shedding for processing 75 III
Lack of appropriate market place 70 IV
High transport cost 50 V
Lack of capital 40 VI

CONCLUSIONS
On the basis of results of the study, we concluded that the farmers were facing plenty
of problems in the procurement-related processing practices of fresh mangoes and getting
market information. The lack of extension services relaying accurate and timely information
on the changing needs of markets to producers was perceived as a problem. The results
showed that the maximum average profit (Rs. 850,500) acre-1 was recorded from Tando
Allahyar district, which is based on Rs. 582,534 acre-1 average cost. Contractors earned the
highest margins (53%) in the whole season with 25% going to producers. The majority
(60%) of mango growers were unaware of the fruit quality standards required for export.
Unstable price of mango was the first rank and lack of education in marketing systems was
the second rank problem in the study area.

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RECOMMENDATIONS
Based on the above conclusions, recommendations for an efficient marketing system
of mangoes are as follows:
1. Public and private extension must impart marketing value chain training to farmers.
2. Mango processing and cold-storage plants should be established in the intensive
mango-growing areas to support and ensure fair prices to the farmers of Sindh.
3. Encourage entrepreneurs to establish processing plants adjacent to mango growing
areas by providing loans through the nationalized bank for establishing processing
mills in rural areas.
4. Timely market information should be provided to the farmers regularly. Timely
market information feedback on their product allows them to match their produce
with near and distant markets and their prices.
5. Develop cooperatives comprising farmers from local areas. The cooperative
movement as a process brings producers one-step closer to the final user of their
product. Producers also acquire a stronger bargaining power for their products
over the powerful middlemen that manipulate and control the price of mango in
the marketing system.

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