A

SYNOPSIS
ON
“BUYING BEHAVIOUR OF CONSUMERS
TOWARDS ORGANIC PRODUCTS”

Submitted in partial fulfillment of the requirements for the degree of

Master of Business Administration
(2017-2019)

Submitted to
Department of Business Administration

Punjab College of Technical Education, Baddowal, Ludhiana.

Affiliated to
Punjab Technical University, Jalandhar.

Research Supervisor Submitted by

Name
Designation Roll No ….
 INTRODUCTION
The rise of supply and demand for organic products is clearly apparent in developed
economies, but is still in its infancy in developing economies. Although developing
countries generally have small proportions of organic production and sales compared
with the global aggregate volume of organic production, their share is expected to expand
in the future. This can be attributed to increasing incomes, greater public awareness of
health issues and trends, and increasing levels of education. In Asia, significant domestic
organic markets are developing in China, India Hong Kong, Malaysia, the Philippines,
and Thailand.

The general increase in concern with health, food safety, and growing environmental
awareness contributes to an expanding demand for organic and environmentally friendly
products in India. However, there has been limited study of the domestic organic market
in India. However, the market share for organic products is still relatively small because
there are major obstacles to increasing domestic demand. First, the market for organic
products in India is in an early stage of its development, and only a small group of
consumers purchase organic products on a regular basis. Second, organic products have
credence attributes such as superior taste, good animal welfare practices, and enhanced
health and environmental sensitivity, but these are not been widely known or understood.
Thus, consumers tend be unaware of these credence attributes when making the decision
to purchase organic products. Unless they are fully informed about the particular
attributes distinguishing organic products from conventional products, consumers’
preferences will remain the same, favouring less expensive, non-organic products, and
the substitution effect may therefore not be realised.

Behavior has a strong influence in terms of consumer purchases. They are the main
triggers in the consumer purchasing process and also influence the perception of a
product. This complicated process enables businesses to attract new consumers and adapt
their products or services according to their needs and wants or change consumers’
behavior towards their products or services. Consumers tend to reduce their impact on the
environment by their purchasing decisions. There are various factors that affect the
buying-decision process of consumers. A number of Researchers have identified many
factors as influencing this process including; environmental knowledge, perceived
product price and quality company‘s environmental reputation, environmental concerns
and credibility of environmental advertising. It has become very essential to know the
factors that create the desire of consumers to purchase a product. Hence, the present study
contributes to the field by investigating and exploring the consumers’ buying behavior
towards herbal and organic products in Ludhiana city.

Definition
There is no common definition of “organic” due to the fact that different countries have
different standard for products to be certified “organic”. In simplest words organic foods
are minimally processed to maintain the integrity of the food without artificial
ingredients, preservatives or irradiation. Organic products are obtained by processes
friendly to the environment, by cultivation techniques that consider both the attributes of
the final product and the production methods. A wide range of consumers of organic food
and non-organic food were addressed and scrutinized to obtain their observations and
visions towards organic food. All organic food consumers are not having the same
method of approach towards organic food. Subsequently the statistical process guides us
to comprehend the relation and the model of the consumer behaviour trends in organic
food in India. The Definition of the word “Organic”, an ecological management
production system that promotes and enhances biodiversity, biological cycles and soil
biological activity. It is based on the minimal use of off-farm inputs and on management
practices that restore, maintain and enhance “ecological harmony” (National Standards
Board of the US Department of Agriculture (USDA)).
 REVIEW OF LITERATURE
Jacob (2017) pointed that consumer buying behavior refers to the actions of consumers
in the market place and the underlying motives for those actions. Consumption pattern,
among Indian consumers are rapidly changing nowadays as a result of environmental
issues, concern about the nutritional value of food and health issues. Issues such as
quality and safety in food attract consumer interest and affect buying behavior towards
organic fruits and vegetables. Research on consumer preferences and demand for organic
fruits and vegetables is increasingly attracting academic interest. Although the concept of
Organic fruits and vegetables seem to be familiar, the proportion of consumers who
purchase them on a regular basis is small in number. The increased consumer’s interest in
Organic Food has been attributed among others to the growing demand for food free from
pesticides and chemical residues

Kumar and Gulati (2017) examined the customer perception towards organic products in
rural area of Haryana in India. The main aims of the study is to know that what customer
actually behave towards organic products. For the purpose of the study a sample of
110respondents was taken. The result of the study shows that a lot of problems are faced
by the rural respondents while purchasing the organic products in the markets. It is not
easy for rural consumers to go to market daily for purchasing organic products because
rural consumer buys in bulk. The finding is that these products are not easily available in
the rural area; they are available in urban areas. So, we can say that irregular availability
of organic products also affects the choice of the consumers.

Padmathy and Saraswathy (2016) investigated the relationship between variables that
affect consumers’ buying behaviour for organic products and identifies the price levels
consumers prefer to pay for organic products in the district. Convenience sampling
method was used to select 200 respondents living in the district and who make purchases
for the products. The primary data was collected from the respondents with the help of
pre-tested structured opened and closed ended questionnaires. In pursuance of the study‘s
stated objectives, the formulated hypotheses were subjected to regression and chi-square
analyzes. The findings of the study reveal that there is significant relationship between
the variables which affects consumers‘buying behaviour for organic products. Similarly,
the factors affecting the consumers‘buying behaviour have major implications on
purchasing decisions.

Sharma and Dewan (2016) focused and to determine the Awareness of Organic Food
Products & the purchase behavior, preference & factors affecting towards organic food of
the selected location. This study was based on primary survey of 100 respondents living
in the Chandigarh & Panchkula. The questionnaire was designed to record the responses
on food safety concerns, frequency of buying behavior, from where they buy the
products, awareness, attitude, factors effecting buying behavior, price effect on
purchasing, behaviors towards organic food and effectiveness of sources for organic
information. This study will help to create awareness amongst consumers about organic
food by the organic companies.

Ahmed and Rahman (2015) identified and explained the factors that influence
consumer buying behaviour of organic foods in Bangladeshi Supermarkets. The study
follows a qualitative research approach with some overlapping of quantitative research
methods, in order to establish a theoretical foundation on factors that influence consumer
behaviour and then conducting a primary research and justifying the results against the
theoretical findings. The influences of these factors are significant to alter consumer
buying behaviour and can sometimes also act as deciding factors for purchase decisions.

Leyer and Wijaya (2015) identified the influence of gender, age and monthly income on
consumers' intentions and perceptions of these products. Organic food products are
offered a niche product in Indonesia, especially in Jakarta. The research data were
collected from 223 consumers in five different areas of Jakarta using a standardized
questionnaire. Rice and vegetables were the most selected organic products. The results
show no significant correlation between sex, age and monthly income with the intention
of consumers to buy organic food. The agreement with several statements about organic
foods indicated a relatively strong knowledge and experience, but the benefits of organic
products were less recognized. Knowledge and information on organic food products
needed in Indonesia.

Mehra and Ratna (2015) identified the factors influencing the attitude and behaviour of
consumers for organic food, which is currently gaining momentum in tier 2 cities in
India. Six significant factors were found to influence the attitude towards organic food.
They were perception towards organic food, health consciousness, product information,
value for money, accessibility and trust. The demographic factors seemed to affect the
attitude towards organic food, while they did not explain the actual buying behaviour.
The paper attempted to provide evidence on the relatively under-researched area of
attitude and behaviour towards organic food in the growing cities in India.

Natvarlal (2015) measured the effect of several factors on the buying behavior of
consumers who purchase Morarka organic food products in Ahmedabad city. A sample
of 300 consumers who consume Morarka Organic Foods as well as Other Organic Foods
was selected. The findings revealed consumer behavior to be influenced by health
consciousness, perceived quality and concern over health safety, trust in organic labeling
and price premium. Organic food is generally looked upon as an alternative to
conventional food for consumers who are concerned about food safety and quality.

Yang et al., (2014) examined the factors that influence consumer attitudes toward
organic food in a growing market and how attitude affects consumers' buying intentions.
The model was tested by conducting an online survey of Chinese consumers. Specific
knowledge of health, consumer knowledge and personal standards obviously showed
their influence on the attitude of Chinese consumers and this latter hypothesis indicates
that the positive relationship between attitude and intention to buy. If two model search
hypotheses were rejected, a new model that is proposed specifically developed for the
Chinese market.

Gotschi et al., (2007) conducted a survey of high school students (between 14 and 20
years) in Vienna determines social norms and attitudes towards organic products that
 influence consumption of organic products in order to add new insights to the discourse.
Young people, who already participate in household decisions and consume organic
products, are of special interest. They may be viewed as future consumers and buyers but
have not yet been recognised sufficiently in research. Based on the Theory of Reasoned
Action, developed by Fishbein and Ajzen, a simple model of the impact of attitudes and
social norm on behaviour is tested, using a data set, which was collected in 2005 (n=340).
It is found from the study that the absence of a significant relation between knowledge on
organic products and actual behaviour (shopping organic products), and cultural
orientations being good predictors for attitudes as well as for behaviour towards organic
products.

Objectives of the study

 To study of buying behaviour of consumer towards organic products.
 To understand the preference and attitude of consumer towards organic products.
 To identify the factors affecting consumer behaviour in choice of herbal and organic
products.
 To know whether the consumer prefer to shift from chemical based products to herbal
and organic cosmetics.
 To study the impact of demographic factors on purchasing decision of Consumer towards
organic products.
 RESEARCH METHODOLOGY
Research Design : The research design will be exploratory in nature.
Data Collection:-
Data will be collected by two ways: -
Primary Data
The primary data for this study will be collected by structured questionnaire method.
Secondary Data
The secondary data for this study will be collected by books, journals and Websites etc.

Population and Sampling

Sampling
Sampling is the process of selecting sector of the population for study

Population:
It is entire group of consumer of Ludhiana City who use organic products.

Sample size:
Sample size of my study will be 150 respondents

Sample Technique:
Convenient sampling will be followed to collect sample size.

Research Tool:
Structured Questionnaire

Statistical Tool:
Percentage method, Factor Analysis, Anova and Correlation.
 REFERENCE

Ahmad, R., & Rahman, K. (2015). Understanding the Consumer Behaviour towards
Organic Food: A Study of the Bangladesh Market. IOSR Journal of Business and
Management , 17 (4), 49-64.
Gotschi, E., Vogel, S., & Lindenthal, T. (2007). High school students’ attitudes and
behaviour towards organic products: survey results from Vienna. Vienna:
University of Natural Resources and Applied Life Sciences .
Jacob, E. (2017). Perception and Buying Behaviour among Consumers in Cochin towards
Organic Fruits and Vegetables. International Journal of Engineering Science and
Computing , 7(6).
Kumar, P., & Gulati, H. (2017). Consumers Perception Towards Organic Food Products
in Rural Area of Haryana. International journal of new technology and Research ,
3 (5).
Leyer, B. F., & Wijaya, Y. (2015). Consumers intention and perception of buying organic
food products in Jakarta. Economic Science for Rural Development , 23 (24), 55-
63.
Mehra, S., & Ratna, P. A. (2015). Attitude and behaviour of consumers towards organic
food: an exploratory study in India . International Journal of Business Excellence
, 7 (6).
Natvarlal, K. B. (2015). Consumer buying behaviour towards Morarka organic food .
Ahmedabad: International Agribusiness management institute, Anand Agriculture
University.
Sharma, G., & Dewan, R. (2016). A study on awareness on organic food products among
general public in Erode City. International Journal of Science and Research , 5
(2).
Yang, M., Shhaban, S. A., & Nguyen, T. B. (2014). Consumer attitude and purchase
intention towards organic foods: A quantitive study of China. China.