Tuesday, January 19, 2010

Basic purpose of market development

The Basic Purpose of the Market Development
It would seem self evident that the basic purpose of a project should be clearly defined. This is frequently not the case and the approach adopted is either over-ambitious in what it wants the marketing infrastructure to achieve or has identified the problem properly but not the correct solution. For example, surplus agricultural production is often seen as marketing “problem” (or even worse as a processing problem), which could be solved by market construction. The solution is likely to be found in making production more responsive to market demand rather than in constructing markets.
The first step in reviewing a project, therefore, is to go back to the policy context in which it will operate. Inevitably, there will be two aspects to this:
· Policies directly under the control of an implementing agency which can be modified if it is found that they are not practical; and
· Policies, which are controlled by external agencies.
With the latter, it will be necessary to ask whether the development’s policies will fit in with those of other bodies, including the private sector. Their priorities, policies and programs need to be quite clearly understood in order to avoid any conflicts. The “marketing forum” discussed above could play a critical role in resolving these issues.
In both cases it will be necessary to determine what would be the development’s relationship to and impact on related projects and development programs such as:
· Agricultural development programs (e.g. extension and crop production);
· Public health improvement programs;
· Environmental damage mitigation programs;
· Neighborhoods and village improvement programs;
· Service upgrading programs (particularly solid-waste management); and
· Rural and urban road improvement programs, including urban traffic-calming measures.
The Main Elements or Functions to be Included
The main elements or functions to be included in a market project should be self-evident. However, it is very easy to include too much in a program without realizing the consequences of this. It is necessary, therefore, too:
· Identify the demand for the project facilities and their relationship to existing infrastructure. This may need special surveys to quantify in broad terms the level of demand
· Identify what standards are required to be adopted; and
· Identify who the likely participants are and how will they be involved? Thus, the main actors in the market development and their particular requirements will need to be defined. This may necessitate establishing a market committee and (in some cases) entering into agreements on future actions (through memoranda of understanding). These could cover the setting of payment amounts at levels related to the financial commitment of the market’s owners or in exchange for the market users taking over greater management responsibilities.
Available Financial Resources and Expertise
Cost will normally be a major determinant of whether a project is viable, as the improvements will need to be economically sustainable (and profitable). This will necessitate a pre-feasibility study. Factors influencing the viability of a market development might include whether there are any:
· Defined capital and operating cost limits, such as fixed norms for construction of new buildings or long-term rental agreements with the market’s tenants?
· Time limits for vacating a site or completing the development?