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BUSNIESS OPPORTUNITIES IN THE AGRO-FOOD INDUSTRY BASED ON THE CONSUMER BEHAVIOR ON FRESH PRODUCE

BUSNIESS OPPORTUNITIES IN THE AGRO-FOOD INDUSTRY BASED ON THE CONSUMER BEHAVIOR ON FRESH PRODUCE. Siti Rahayu Hussin Fakulti Ekonomi & Pengurusan Universiti Putra Malaysia 22 nd August 2008 MAHA Walk-in Seminar. RESEARCH FINDINGS Product choice Product attributes Retail outlet choice

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BUSNIESS OPPORTUNITIES IN THE AGRO-FOOD INDUSTRY BASED ON THE CONSUMER BEHAVIOR ON FRESH PRODUCE

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  1. BUSNIESS OPPORTUNITIES IN THE AGRO-FOOD INDUSTRY BASED ON THE CONSUMER BEHAVIOR ON FRESH PRODUCE Siti Rahayu Hussin Fakulti Ekonomi & Pengurusan Universiti Putra Malaysia 22nd August 2008 MAHA Walk-in Seminar

  2. RESEARCH FINDINGS Product choice Product attributes Retail outlet choice OPPROTUNITIES Consumptions Retailing RECOMMENDATIONS - Planters/producers Retailers Government agencies Consumer education PRESENTATION OUTLINE

  3. To investigate consumers’ patronage behaviour in terms of purchasing of fresh produce in Semenanjung Malaysia, Sabah and Sarawak. The research

  4. Fresh produce – vegetables (leafy and non-leafy) and fruits. Retail outlets – mobile outlets (pasar tani, pasar malam, etc), hypermarket, supermarket, department store, sundry shop. Sample – urban areas, adult shoppers The research

  5. Product choice Product attributes Retail outlet choice RESEARCH FINDINGS

  6. RESEARCH FINDINGS 1. Product choice

  7. Respondents’ choice of fruits

  8. Respondents’ choice of leafy vegetables

  9. Respondents’ choice of non leafy vegetables

  10. Expenses on Fruits and Vegetables in a Month

  11. RESEARCH FINDINGS 2. Product attributes

  12. (1) quality, (2) value-added, (3) country of origin and (4) price Quality: absence of defect, absence of blemishes, ripeness, freshness, absence of pesticides, absence of preservatives, nutritional value, and cleanliness. Value-added: pre-cut, ready to eat and ready to cook are not considered as important as cleaned, labelled and organically grown to many respondents. Country of origin: are also considered important by the respondents. Locally grown produce is an important attribute. Price: Reasonable price, availability of promotion and price bargaining as very important. Product attributes

  13. Product attribute & demography

  14. Cleaned and age

  15. Cleaned and household income

  16. Cleaned and race

  17. Organically grown and age

  18. Organically grown and household income

  19. Labeling and age

  20. Labeling and household income

  21. Pre-cut and age

  22. Pre-cut and household income

  23. Ready to cook and age

  24. Ready to cook and household income

  25. Ready to eat and age

  26. Ready to eat and household income

  27. Price factor and demographics

  28. Price bargaining

  29. Reasonable price

  30. Availability of promotion and age

  31. Availability of promotion and household income

  32. Origin factor and demographics

  33. Country of origin and household income

  34. Locally grown and age

  35. RESEARCH FINDINGS 3. Retail outlet choice

  36. % consumers shopped at this outlet in past 2 months: Wet market (16.9) Mobile market (16.7) Hypermarket (15.4) Department store (13.1) Street sales (12.4) Sundry shop (13.6) Supermarket (11.9) Store patronage behavior (fruits)

  37. % consumers shopped at this outlet in past 2 months: Wet market (20) Mobile market (18.6) Hypermarket (17.3) Sundry shop (16.7) Department store (14.1) Supermarket (13.3) Store patronage behavior (vegetables)

  38. Retail Patronage Behaviour (Fruits) By Overall Respondents

  39. continued Retail Patronage Behaviour (Fruits) on type of outlet

  40. Retail Patronage Behaviour (Vegetables) By Overall Respondents

  41. continued

  42. Store Patronage Behaviour (Fruits) by State

  43. Store Patronage Behaviour (Vegetables) by State

  44. CONSUMPTIONS/ PURCHASE BEHAVIOR There is indication of moderate to high consumption of fresh produce (RM30 per month) Persuade consumers to increase consumption: gift giving, health purpose, etc. Product attributes such as quality, value-added, country of origin and price are all considered important for fresh produce shoppers in Malaysia. There seems to be a preference for local produce. Consumers aged 40 and above say that price bargaining are unimportant. People with household income more than RM10,000 say that price bargaining is unimportant. OPPROTUNITIES

  45. Capitalise on these attributes: absence of defect, absence of blemishes, ripeness, freshness, absence of pesticides, absence of preservatives, nutritional value, cleanliness and reasonable price. Growers may need to perform more functions such as: Cleaning Cutting Peeling Value-added may be the in-thing in the future (ready-to-cook, ready-to-eat, etc) OPPROTUNITIES

  46. RETAILING Consumers prefer to purchase fruits and vegetables from mobile outlet, wet market, hypermarket and department store. Innovative retailing to increase exposure and frequency of consumption: e.g. van bergerak, fruit stall, etc. For more frequent purchase, consumers tend to prefer more traditional retailers such as mobile outlets and wet market. For a less-frequent purchase, consumers are reported to prefer bigger retailers such as hypermarkets and department stores. Certain type of consumers still prefer to purchase fresh produce from sundry shop, especially for daily purchase of fruits and vegetables. OPPROTUNITIES

  47. Product display Product supply Product price Free sampling Recipes Cooking instructions Benefits information Packaging – loose, wrapped, basket, box, etc. Retailing

  48. Planters/producers - Improve production/supply and quality of produce - Efficient packaging Better presentation of local fruits Retailers - Identify which segment of the market and for what purpose consumers seek those retailers that suit their needs and wants. - Positioning strategies require the identification of target customers and strategies that cater to the needs of that particular target market. Government agencies Grading system for selected fruits Labelling requirement (nutritional fact, country of origin, date of harvest, etc.) Quality control certification services Government’s role in improving mobile outlets should be continued Consumer education - Educate public about local fruits - Consumer education starts at school and home - Health campaign RECOMMENDATIONS

  49. Be customer-oriented Use marketing strategy/marketing orientation Start with customers Pull strategy : consumer education, mobile outlet, organic fruits, gift giving/hamper Push strategy : value-added – ready to cook, ready to eat, food away from home Relationship marketing a way forward Grab the opportunity! (slipper e.g) RECOMMENDATIONS

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