Intermediaries in the fish marketing process and

Price Differences in Gopalganj

Reza Shahbaz HadiRoll: 150; Section: B; 12th Batch

Department of Marketing; University of Dhaka

Abstract:

This study is based on the role and influence of the intermediaries in the overall fish

marketing process. It also focuses on the price differences caused by those intermediaries.

Some suggestions on how to eliminate these intermediaries are also recommended. With the

help of this report, the farmers will be able to get higher wages and the consumers will be

able to pay fair prices for the fishes they purchase.

Keywords: Fish marketing process, Intermediaries.

1. Introduction:

With the age old tradition, the fishery sector is providing almost one-eighth [12.05%] of the

entire population of Bangladesh with the opportunity to earn their livelihood (Journal of

social sciences, 2006). Thus the importance of fishery sector is apparent in the economic

development of the country. Throughout the year, various types of fishes are being cultivated

by the fishermen. The availability of fish at the right time at the right place is at the heart of

the success in fish marketing. Fishermen are hardly involved in process. Their responsibility

is confined to catching fishes only.

In the fish market, fishermen are not getting proper benefit due to the intervention of

intermediaries. Fishermen hardly have storage facility and due to the perishable nature of

fish, they are bound to sell fish at lower price. On the other hand, the consumers have to pay

higher prices for the fishes at local markets.

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1.1 Purpose of this study

The study was conducted with the main objective of tracking “The Intermediaries in

Fish Marketing and their influence on price difference”. Other than this, the study will also

focus on:

The functions of the intermediaries

The profit margins consumed by the intermediaries

1.2 Prior study

Fish trading is always considered an important sector and thus many studies have

been conducted before. But marketing and trading practices of fish is quite inadequately

studied. Some prior studies related to this study are given as follows:

The salient feature of fish marketing system and three fish marketing areas,

urban, suburban and rural fish market and the pond fish marketing system of

Bangladesh have been studied in Comilla. [Chowdhury M.H. 2004].

The Transactional, logistical, and facilitating functions and various advantages

and disadvantages of using intermediaries in fish marketing have been studied on

a theoretical view point. [Sharma S. S.]

The reasons for price difference between fishermen and consumers, i.e,

transportation, personal expenses, aratder’s commission, market tolls, and

wastages and many other sectors are described from a study in Chuadanga (2002).

The fish marketing systems, based on existing marketing systems, economic

features of marketing activities and inefficiencies are described from study in

Gazipur. [Ahmed N. and Rahman M. M., 2005]

By taking the insights of these studies, this study was conducted on the specific roles

of the intermediaries, their functions in the market place, the ways of and reasons for price

rise, and price differences in fish marketing channel of Gopalganj district.

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2. Materials and Methods

2.1 Field Study

This paper is prepared stemming from a root level. The field study was done in

Gopalganj district. The study was conducted at Kashiani, Gohata Thana, Paruliya Village,

Bonni-r Bawor, Chander Bill, Chaptar Bazar, and Ramadiya Bazar. The time frame of this

total field work was from June 23rd to 27th, 2010.

A rigorous attempt was undertaken to mine the true fact from dawn to dusk. The

fieldwork started in the morning when the fishes were brought to market and were sold to

other intermediaries either in a bidding process or through bargaining. In the market, all the

intermediaries were available and this is why maximum time was spent there. In Gopalganj

district, there is a government operated fisheries in Gohata Thana. The manager of fisheries

and Local pond owners were interviewed according to their leisure. The end consumers were

interviewed while they were either entering or leaving the marketplace.

2.2 Sample

To conduct the study, a total of 50 samples are taken. Out of these, 10 retailers were

interviewed, as they have direct contact with the consumers. To check the validity and

reliability of the information, 10 consumers were interviewed. Retailers purchase fishes

mostly from the Aratdar [fish businessman]. Thus 5 Aratdars were also interviewed. Many

small retailers collect fishes either from Foriyas [those who catch fish in others’ ponds] or

directly from the fishermen. Thus, 10 fishermen and 5 foriyas were interrogated. The foriyas

used to get fishes from local pond owners. This is why, 8 pond owners were also visited.

2.3 Sampling method

Not all the parties involved in the fish marketing process are equally knowledgeable.

So, probability sampling may not result in an effective sampling frame. The fieldwork was

done in accompany with a local young boy, Md. Rafiqul Islam, and a businessman, Md.

Didar Hossain, who knew the people well. Non probability sampling technique was used in

this study as the selection of sample was based on judgment rather than chance. Judgmental

sampling was used to prepare the sampling frame.

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2.4 Data type

The paper is mainly focusing the fish marketing process in Gopalganj district. No

such study is conducted there previously. All the data collected from the field is primary in

nature. As there is no secondary data available in this topic about this region, web search and

literatures of other regions are studied.

2.5 Data collection method

The overall data collection process was done using a questionnaire [see Appendix].

The questionnaire was prepared before going to the field. And the data were collected in

depth interview method. The notion behind the decision of using this method was that the fish

marketing process is conventional and rarely is it possible for any sort of new concept. So,

what is necessary is to talk with a person who has deep knowledge in this sector. And this is

why depth interview is seemed to be the most effective method.

3. Results and Discussion:

3.1 Name of fishes under study

The people of Gopalganj are very much fond of eating fishes. So, a huge variety of

fishes are seen in the market. Taking into account all the fishes is almost impossible. Fishes

are selected based on the consumer preference, profitability, size, availability, and of course

cultivability. Following are some of the fishes –

Ruhi

Puthy

Miner-carp

Silver-carp

Katol

Mrigel

Vata

Grass-carp

Hilsa

Pangash

Nol

3.2 Channel Members

3.2.1 Fishermen

The first member of the overall fish marketing process is the fishermen. There main

job responsibility is catching and selling fishes. How they catch and sell fishes is different.

Some fishermen have nets and boats in their own, whereas some borrow from others or go for

partnership. After catching fishes, they sell in MON {40 kg}. They have 3 alternative ways to

sell the fishes. They usually sell to FORIYAs who bring the fishes to the market. Or the

fishermen can sell the fishes to the retailers who sell directly to the consumer. They most

often sell to rural ARATDAR when the amount of fishes is very large.

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3.2.2 Fishery

Gopalganj has a government owned fishery at Gohata Thana. The fishery contains 10

ponds in which almost all types of fishes, related to this study, are being cultivated. The

fishery is responsible for the reproduction of fishes. The fishery has 2 ponds, one for big

fishes and another for small fishes, where the mother fishes are kept to lay eggs. These eggs

are then hatched in another pond. When the fishes are born, usually called RENU or PONA,

these are sold, in thousands, to ARATDAR, who then cultivates the fish.

3.2.3 Local Pond Owner

There are many pond owners in Gopalganj. Almost every household has its own

pond. Not all pond owners cultivate fish. They get fishes in their ponds naturally and thus

they consume the fish. In the season, when there are plenty of fishes, they used to call Foriyas

to catch fishes in a 50—50 basis.

3.2.4 Intermediaries

There is a small number of intermediary operating in the fish marketing process in

Gopalganj. But their impact is very much crucial.

i. Foriya

Foriya is a local term of Gopalganj. It generally indicates small group of

people used to earn their living by catching fishes in others’ ponds. They then bring

the fishes to local market. They sell the fishes either directly to the consumers or to

the retailers. They usually sell the fishes in a measure of every pot basis {HARI}.

ii. Retailer

Retailers exist at the last corner of the marketing process. They sell directly to

the consumers. They collect fishes either from the foriyas or from the aratdars. They

purchase small and mixed {PANCH MISHALI} fishes from the foriyas in a

measurement of every pot {HARI}. They collect big fishes from aratdar in a bidding

process. The retailer who bids highest takes title to the fish to sell in the market. More

discussion on the bidding process is given later. One exception from these two is that,

sometimes retailers are seen to be selling sea-fishes, tortoises, and crabs. They collect

these from the fishermen.

iii. Rural Aratdar

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The scope and activity of rural aratdar is simply astonishing. They are

responsible for bridging the gap between the fishermen and the retailers. They

organize a bidding environment. At the same time, many of them purchase RENU

from fisheries and cultivate fish. Many of them send fishes to urban aratdars. These

rural aratdars do not sell directly to the consumer. They work as intermediaries. They

receive a commission [usually 3% of the bidding price] for their job.

iv. Urban Aratdar

Here, urban aratdar refers to those in divisional cities or any other of country.

Some rural aratdar sells fishes to these parties. This study is based only on Gopalganj.

So, the role of urban aratdar was not taken into consideration. But as a general

process, they must use an intermediary to reach the consumer. And retailers are best

in this purpose.

3.3 Marketing channel

A mixed nature of marketing channel, though not very complex, is found in the fish

marketing process. The number of intermediaries is small. But the way in which fishes reach

to ultimate consumer is rather diverse. Each of them tries to grab the whole margin. Some can

make their own way, whereas some depend on others. Following are the marketing channels

found in Gopalganj –

Channel 1: Fishermen Retailer Consumer

Channel 2: Fishermen Foriya Retailer Consumer

Channel 3: Fishermen Foriya Consumer

Channel 4: Fishermen Rural Aratdar Retailer Consumer

Channel 5: Fishermen Rural Aratdar Urban Aratdar

Retailer Consumer

Channel 6: Local Pond Owner Foriya Retailer Consumer

Channel 7: Local Pond Owner Foriya Consumer

Channel 8: Fisheries Rural Aratdar Retailer Consumer

Channel 9: Fisheries Rural Aratdar Urban Aratdar

Retailer Consumer

3.4 Flow of Fishes

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3.5 Price table

This study considers fishes that are very much available. While selecting fishes,

consumer preference, profitability, size, and cultivability are taken into consideration. The

prices of the fishes in the marketplace, including the purchasing price paid by intermediaries

and the purchasing price paid by the consumers, are given below:

Name of

Fishes

Price for

Fishermen/Foriya [BDT]

Commission For

Aratdar [BDT]

Price for

Retailer [BDT]

Price for

Consumer [BDT]

Price Difference

[BDT]

Profit

Margin[%]

Ayir 400/kg

Based

on

the

Bidding

Process

750/kg 900/kg 150/kg 20

Boyal 200/kg 500/kg 600/kg 100/kg 20

Ilish [small] 160/kg 300/kg 400/kg 100/kg 33

Ilish [medium] 220/kg 400/kg 600/kg 200/kg 50

Ilish [large] 300/kg 620/kg 800/kg 180/kg 29

Katol 100/kg 200/kg 250/kg 50/kg 25

Koi [small] 120/24 pcs 200/24 pcs 300/24 pcs 100/24 pcs 50

Koi [large] 150/24 pcs 350/24 pcs 600/24 pcs 250/24 pcs 72

Minar Carp 60/kg 112.5/kg 120/kg 7.5/kg 7

Mrigel 80/kg 125/kg 150/kg 25/kg 20

Nola 80/kg 110/kg 120/kg 10/kg 9

Pangash 60/kg 87.5/kg 100/kg 12.5/kg 15

Ruhi [small] 80/kg 130/kg 150/kg 20/kg 15

Ruhi [large] 140/kg 250/kg 300/kg 50/kg 20

Silver Carp 50/kg 80/kg 90/kg 10/kg 12.5

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Fishermen

Rural Aratdar

Urban Aratdar {Divisional city/ Dhaka/ Other

part of the country}

Foriya

Ultimate Consumer

Ultimate ConsumerRetailer

Local Pond OwnerFisheries

Retailer

3.6 Price differences

From the table given, it is apparent that the fishermen are the least beneficial and the

consumers are most survivors. The profit margin set by each of the intermediaries depend

almost their own will. The price difference in each layer is described below:

In most of the cases, price difference between fishermen and consumer is almost

doubled. In some cases, it is more than this. The reasons behind this increase are

– transportation cost, storage cost, bidders’ commission, market co-operative

subscription, and the most significant the profusion and demand for the fishes.

The profit margin for Carp fishes, Nola, and Pangash are very low. The reasons

behind this are – pond owners get these fishes on their ponds, these fishes are

grow up very quickly, and are highly available.

The margin for Ayir, Boyal, and Mrigel are equal. Ayir and Boyal fishes are

very expensive and consumed by some consumers or consumed occasionally.

Thus the price is kept charging a minimum margin to encourage purchase.

The margin for Koi is highest due to its overall demand. The people of

Gopalganj need Koi fishes at their dining table twice/thrice in a week. Though

most of them get Koi fish in their own ponds, the size matters the price increase.

In case of Ilish and Rui, no specific reason is found for increased price. The

Padma River is close to the district that provides Ilish. Both own cultivated and

imported Ruhi fishes are available in the market. However, price is high. It is

nothing but due to the syndicate grouping of parties involved in the process.

The profit margin of Aratdar is not confined to the commission earned through

bidding process only. They charge their functional and operational costs also.

The profit margin of retailers is set solely by themselves. This is why not even

aratdars can get a share of this increased price.

3.7 Price Bidding Process

The bidding process is taped to see how price is set. Every morning huge collection of

fishes, loaded in trucks, arrive market. These fishes are either brought by the fishermen or

someone else who purchase from fishermen. Then aratdars take the responsibility of selling

the fishes. Aratdars usually have 2/3 people who conduct the bidding task and the aratdars

remain busy in calculation. They also own some people in disguise of retailers who bid just to

increase the price. When the highest bid is fixed, the Aratdars get a fixed commission on the

selling price. The commission rate varies from 3% to 10% based on the nature of fish.

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4. Limitations of the study

This paper is not free from limitations. A deep attention is put while preparing the

paper. So, flaws related to study may not be found. However, some limitations are there:

1) The study focuses only on the Gopalganj district.

2) The study takes into account only 10 major fishes based on judgment. The price

difference for other fishes may vary significantly.

3) There is hardly any previous study in this topic, thus it is hard to compare results.

4) As fishes are cultivated based on nature and the field work is done in the month of

June, when there is plenty of fishes available everywhere, the findings in other time

of the year may vary.

5. Conclusion and Recommendation

One of the objectives of this study is to ensure fair prices for both the fishermen and the

consumers. Some recommendations in this respect can be made:

1) The price rise is caused by the middlemen. The number of middlemen is not very

high. But their impact is very influencing. Thus, what can be done is to distribute the

marketing function to different intermediaries. Then a fixed amount can be set to

compensate those functions.

2) A fixed commission for the aratdars is a must. This may result in fair treatment of

fishermen of different fishes.

3) The involvement of syndicated group of people must be resisted in order to keep the

price stable according to what the retailers actually want to pay.

4) The willingness of the retailers to set and charge prices must be brought into a fixed

rate of profit margin based on the type, nature, availability, size, and consumer

preference of the fishes.

5) The rates set for aratdars and retailers must be informed to both the fishermen and the

consumers. The fishermen then may need not to pay high commission to the aratdars.

And the consumers will not have to pay what the retailers set.

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Reference

Ahmed N. and Rahman M. M., “A Study on Fish Marketing Systems in Gazipur,

Bangladesh”, Pakistan Journal of Biological Sciences, Karachi, Pakistan, vol-8, issue-

2, pp 287-292, 2006.

Chowdhury M H., “Fish market and marketing issues in Bangladesh”, International

Institute of Fisheries Economics & Trade, Corvallis, Oregon, (USA), 2004

“Entrepreneurship barriers of pond fish cultures in Bangladesh: A case study from

Mymansingh district”, Journal of Social Sciences 2 (3): 68-73, 2006.

“Fish marketing in some local markets of Chuadanga district of Bangladesh, 2002”

available at http://www.bdresearch.org/home/index2.php?

page=shop.product_details&flypage=flypage.tpl&product_id=359&category_id=3&o

ption=com_virtuemart&Itemid=64 electronically accessed on 21.08.2010

Sharma S. S., “Why Use Intermediaries in Marketing?” available at

http://www.marketingcrossing.com/article/220071/Why-Use-Intermediaries-in-

Marketing-/, electronically searched on 15.08.2010

Appendix

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Questionnaire for Depth Interview:

1. What do you do in fish marketing process?

2. What fishes do you cultivate?

3. What are the sources of your income in fish marketing process?

4. What are the rates in which you sell your fishes?

5. To whom do you sell your fishes?

6. Where do you sell your fishes?

7. At what time do you sell your fishes?

8. In what measurement {quantity} do you sell your fishes?

9. What are the parties involved in fish marketing process?

10. What are the problems are you facing in fish marketing?

♣ What are the problems you face regarding storage facility?

♣ Do you have any bargaining power in dealing with fish?

♣ Do you have easy market access?

♣ Do you have sufficient transportation facility?

♣ Do you get up to date market information regarding rates or demands or the like?

11. What sort of solutions do you expect for these problems?

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Course Name: Agricultural MarketingCourse No. : 421Course Teacher: Arifur Rahman

Department of MarketingUniversity of Dhaka

Reza Shahbaz HadiRoll no. – 150 Batch – 12th

Department of MarketingUniversity of Dhaka