Project Team:

Department of Agricultural Marketing Cooperation and Business Management

University of Agricultural Sciences, Bangalore-65

Branding and Direct Sale of Mangoes in Bangalore City

Kolar Gold Mangoes (K.G.M.)

L-R

Mr. P.V. Rame Gowda

Associate Professor

Dr. P.K. Mandanna

Professor and University Head, PI RKVY

Mr. T.N. Venkata Reddy,

Professor KSAMB Chair

Mr. Raghavendra.V.G
Research Fellow - RKVY Project

Contact Persons:

RASTRIYA KRISHI VIKASA YOJANA

Activity under:

Mr. P.V. Rame Gowda

PH: 9448544889 Email: pvramegowda@yahoo.com

Mr. T.N. Venkata Reddy

PH: 9448798402 Email: tnvenkatareddy@gmail.com

Market-Led Extension Cell

BRANDING AND DIRECT SALE OF MANGOES IN BANGALORE CITY

Table: 2 Selected District-wise Area, Production and Productivity of Mango in Karnataka (2004-2005)
(Area in ' 00 Hectare, Production in ' 00 Tonne, Yield in Kg./ha.) District Area Production Kolar 337.7 622.0 Bangalore Rural 203.0 695.2 Tumkur 110.3 174.5 Mysore 29.5 487.1 Dharwad 29.0 75.9 Mandya 25.6 73.9 Chikkamagalur 23.4 105.2 Hassan 21.3 84.4 Davanagere 19.0 168.5 Yield 1842 3425 1582 16490 2614 2889 4497 3958 8893
Source: India stat

Introduction
Agricultural sector in India contributes about 21 per cent to India's GDP. Horticultural crops constitute a significant component (accounting for 28 per cent of the GDP contributed by agriculture) of agricultural production of the country, particularly fruits. Horticultural crops cover approximately 8.5 per cent of the total cropped area (20 M.ha) with an annual production of 184.9 mt and a productivity of 9.24 tonnes per hectare during the year 2005-06. Among the horticultural crops in India, mango occupies an important place in terms of both production and productivity. Among fruits, Mango (108 lakh tonnes) stands next to banana in terms of production. India is the largest producer of mango in the world with an annual average production of 100 lakh tonnes with an area of 16 lakh hectares. Mango cultivation in the country accounts for 42 per cent of total area under fruits. Karnataka produces nearly 13 lakh tonnes of mango fruits annually. The major varieties of mango grown In Karnataka are Alphanso, Badami, Totapuri, Malgoa, Rasapuri, Sindhura, Neelam and Mallika and the peak harvesting season is from March to July.

The mango growing districts of Karnataka are Kolar, Bangalore, Tumkur, Davanagere, Dharwad, Hassan, Mandya and Mysore. The area under mango cultivation (33,770 Ha) is largest in Kolar district with a production of 62,200 tonnes, Bangalore district stands second in area and but first in production, with 20300 ha and 69520 tonnes respectively, Tumkur ranks third in mango area and production with 11030 ha and 17450 tonnes respectively. Mysore district stands first in the state in productivity of mango with 16.5 tonnes per ha. In Kolar district, mango production is concentrated in Srinivasapur taluk both in area and production as presented in table:3.

Table: 3 Area, production and productivity of mango in Kolar Disstrict (2008- 09)
Area (in Hectare) Kolar District 39090 20275 10750 5451 Production (in Tonne) 149095 81100 39775 54510 Productivity (Tonne/Hectare) 3.81 4.00 3.70 10.00

Table: 1 Area, production and productivity of mango in Karnataka (2003- 08)

Year 2003-04 2004-05 2005-06 2006-07 2007-08 Area (in Hectare) 116261 120833 121456 129092 134567 Production (in Tonne) 1111206 1189222 1292707 1368765 1223258 Productivity (Tonne/Hectare) 9.56 9.84 10.64 11.00 9.09

Srinivasapur Mulbagalu Chintamani

Source: Department of Horticulture

Source: Department of Horticulture

Existing Marketing Channel for Mango

Mango is traded in fresh form for a very short period, as its shelf life is very short. Depending on the variety harvested in different states from March to July, mango is traded between April to August. Mango is brought to Mandies either by farmers themselves or by contractors. Preharvest Contractors play a major role in mango trade. They purchase the orchard during flowering season by paying some nominal amount to the farmers. Thereafter, they will take the responsibility of watch and ward, harvesting, transporting and marketing. These pre-harvest contractors have well established contacts with traders (locally or other states) to whom they sell the produce after reaching the market. Commission agents play an important role, followed by traders, shopkeepers, hawkers in reaching the final consumers.

procedures, all these problems compel the growers to sell their produce to pre-harvest contractors to avoid the risk in watch and ward, harvesting, transportation and marketing. Under the circumstances the market intermediaries tend to grab more margins leaving a pittance to the farmer. With this background a new model of marketing, branding and direct sale of mangoes was taken up on a pilot basis in Bangalore city by farmers during the 2009 season under the initiative of Market-Led Extension Cell of RKVY project in the Department of Agricultural Marketing, Cooperation and Business Management, University of Agricultural Sciences, Bangalore. To popularize the concept of branding and direct sales, a group of farmers from Srinivasapur taluk, Kolar district were selected and a self help group of mango growers was formed. A training was organized for mango growers under Rastriya Krishi Vikasa Yojana (GOI) Project in February 2009 on production and marketing practices of mango. Scientists from University of Agricultural Sciences, Bangalore had trained the farmers in scientific production practices, harvesting and post harvest handling of mangoes.

Major marketing channels observed in mango trade are

1. Farm-------Pre-harvest-Contractor------Trader/CA-------Wholesaler------- Retailer --- Consumer 2. Farm------- Trader/Commission Agents-------Wholesaler-------Retailer---Consumer 3. Farm------- Traders -------- Retailer------consumer 4. Farm-------Retailer------consumer 5. Farm ------ Processor 6. Farm ------ Trader------- processor

Evolving of brand name and organizing direct sales

At present, there is a gap in the market for quality and convenient packaging of mangoes. By promoting branding and organizing direct sales, the branding concept can be popularized among the farming community and consumers can patronize the brand. With this background a Brand Name, 'Kolar Gold Mangoes' indicating the identity of the place (Kolar) for Gold and Mangoes, a logo (KGM) was evolved for direct sale of mangoes. To give wider publicity about direct sales of KGM brand of mangoes outdoor advertisement was done and a brochure was prepared to appeal to the consumer to patronize KGM brand and encourage the farming community. A group of six enthusiastic farmers trained under the training programme were selected for direct sales of mangoes in Bangalore city. To organize direct sales different locations in Bangalore city are selected looking into consumers' profile and density of population. To inculcate the habit of branding and direct sales and also to encourage farmers, 9600 corrugated boxes of 3kg capacity, with branding details were supplied, free of cost.

Price Spread
Farmers are ignorant of consumer's choice and quality of the fruits. Unscientific harvesting and handling of mango results in huge wastage during post harvest stages. Consumers' price in the market is influenced by the proportion of fruits wasted in the channel. A large proportion of the consumer's rupee is taken away by the intermediaries; leaving a small chunk to the farmers. Thus, the present system of marketing is far from satisfaction. There are, however, some sound reasons as to why the grower cannot easily overcome these difficulties, unscientific production practices, poor post harvest handling, distance from the market and lack of quick means of transportation, immediate need for money, lack of coordination between growers and agents in the wholesale markets, lack of awareness about markets and marketing

Selection of sale points

The sale points were selected targeting different classes of consumers in different places. The consumers targeted for direct sales at GKVK and KSAMB are office goers. At Lalbagh daily early morning sales were started targeting morning walkers. Near JP Garden in Yashavanthpur, evening walkers were targeted, as they comprise cross section of the society. The price sensitivity of consumers is closely linked to their incomes. There are

certain posh areas in the city. Bangalore cantonment east is one such area. The spot at a petrol bunk run by Venkatadri enterprises located in Banaswadi main road was chosen for direct sales. The HP dealer is known to the University scientists and hence direct sales was arranged and the farmer was advised to charge 15 percent higher price to encash high income group consumers in the area.

Table: 4 Details of farmers selected, place of sales and number of branded boxes sold
Sl.No 1 2 3 4 5 6 Name of the farmer Raja Reddy Devraja Reddy Lakshmana Reddy V.N. Narayana Swami B.N.Chandra Reddy V.R. Anand Village name Diguvapalli Pathapalli Kiruvara Venkatapura Bandapalli Varthanahalli Place of direct sale J.P graden, BEL circle H.P.Petrol bunk Banasavadi Lalbagh east gate, KSAMB GKVK, Corporation office circle Lalbagh, NES Yalahanka Lalbagh west gate Number of boxes supplied 1800 1800 1800 1800 1200 1200

The retail prices of mangoes in Bangalore city has been presented in Table: 5, from the table it is observed that the retail prices of different varieties of mango in Jayanagar and Koramanagala are slightly higher than Yelahanka and Mathikere. It was found that the price sensitivity of consumers is closely linked to income levels. Since Jayanagar and Koramanagala are inhabited by higher income groups, the retail prices over there are found to be slightly higher compared to other places in the city.

Table 6: Variety-wise retail prices of mango in different modern retail outlets in Bangalore city
Sl.No 1 2 3 4 5 Varieties Alphanso Mallika Benisha Malagoba Neelam Reliance 80 45 35 50 36 More 78 45 35 45 30 Nilgiris 75 48 35 46 35 Smart 75 45 35 45 35

Methodology
To analyze the economic benefit of branding and direct sales of mangoes to farmers, primary data was generated by recording on daily basis. Relevant secondary data on prices and arrivals of mango in wholesale markets were also collected from APMC Srinivasapur and Bangalore, retail prices of the mango in the Bangalore city were ascertained from fruit vendors and modern retail outlets across the city. Measures of central tendency were applied to analyze the data.

The retail prices of mango in the modern retail formats are presented in Table: 6. It could be observed from the table that there was no much variation in the prices among different modern retail formats. When we compare these prices with the prices of the branding and direct sale prices, the retail outlet prices are high as they incur more cost on grading, sorting, transport, storage and also the administrative costs.

Table 7: Variety-wise average wholesale market prices of mango in Byatarayanapura APMC market yard during 2009 season

Sl.No 1 2 3 4 5 6 7

Varieties Rasapuri Alphanso Totapuri Local Neelam Benisha Mallika

Price of mango per tonne 8000 18000 4600 3500 5700 7500 14000

Table 5: Variety-wise retail price of mango by push cart fruit vendors at different places in the city (Price in rupees)
Sl.No 1 2 3 4 5 Varieties Alphanso Mallika Benisha Malagoba Neelam Jayanagar 65 45 35 45 35 Yalahanka 60 42 30 40 30 Matthikere 65 45 30 40 30 Koramangala 65 45 35 45 30

From the data collected from the APMC's it is found that the average price Alphanso ( Rs 18000 per tonne ) tops with market price followed by Mallika variety was Rs. 14000 and Rasapuri, Benisha, Neelam, Totapuri and local varieties with market prices of Rs. 8000, Rs.7500, Rs.5700, Rs.4600 and Rs 3500 respectively. As price of the commodity is directly influenced by demand, from the data it is observed that wholesale market prices of Alphanso and Mallika varieties are very higher since the demand for these two varieties is higher.

Cost incurred for marketing of mango in wholesale market is presented in the table 9, it is found that the cost incurred in selling at whole sale market of mango includes Rs. 750 per tonne for harvesting and grading of mangoes, bulk transportation from gardens to the markets by using tractors costs Rs. 350 per tonne and commission collected by the commission agents from the farmers for selling of the produce was 10 per cent of the total value of the produce, irrespective of variety these costs are similar for marketing of mango in the nearby wholesale markets. The percentage of wastage varied from variety to variety amounting to about 5 per cent.

Table: 10 Cost incurred for direct sale of mangoes in Bangalore city

Sl.No 1 2 3 4 5 6 7 8 Particulars Harvesting and Grading Transportation to pack house Ripening and packing Rent of pack house Cost of corrugated boxes Transportation to sales points Labour charges and living expenses Wastage of fruits Cost incurred in Rs per tonne 750.00 800.00 250.00 350.00 3600 350.00 600.00 10 % of the total value

Table: 8 Variety-wise direct sale price of Kolar Gold Mangoes in Bangalore city.
Sl.No 1 2 3 4 5 Varieties Alphanso Mallika Benisha Malagoba Neelam Price Rs per Kg of Mangoes * 45 30 25 30 20 Price Rs per Kg of Mangoes ** 50 35 30 35 22

* Direct sale price of different varieties of mango at GKVK, JP Garden, Lalbagh east gate & west gate, KSAMB, Corporation sale points in the City ** Direct sale price of different varieties of mango at H P Petrol bunk Banasavadi Variety wise direct Sale prices of mango are presented in the table 8. It was found that the prices of mangoes sold at HP Petrol bunk Banasavadi is 10 to 15 per cent higher than the other places in the city. In spite of higher prices, there was greater demand for the fruits. Consumers turned out to be regular customers to patronize the direct sales. Around 20 per cent of the customers of the petrol bunk are also buyers of Kolar Gold mangoes.

Cost incurred for direct sales of one tonne of mango in Bangalore city
To analyze the economic benefits of direct sales of mangoes through branding the data on cost incurred was collected and analyzed. The details are presented in the table: 10. Labour charges for harvesting and grading of fruits account for Rs 750 per tonne, transportation of fruits from the garden to the ripening/packing house in the city costs Rs 800 per tonne, cost incurred for ripening and packing is Rs 250, rent paid for packing house worked out to Rs. 350 per tonne, cost of labeled corrugated boxes for selling one tonne of mangoes is Rs. 3600, transportation charges for taking fruits from packing house to sales points is Rs. 350, living expenses and labour charge for sales personnel comes to Rs. 600 and wastage accounted for 10 per cent of produce during grading, ripening and transportation. This wastage will be offset by the saving in commission charges to have been paid if sold in APMC's through commission agents.

Table: 9 Cost incurred for marketing of mango in wholesale market

Sl.No 1. 2. 3. 4. 5. Particulars Harvesting and Grading Transpiration to near by wholesale market Other miscellaneous expenses Commission collected by commission agents Wastage of fruits in marketing Cost incurred Rs per tonne 750.00 350.00 300.00 10 % of the value 5 % of the value

Table: 11 Comparison of mango prices realized by farmers in various channels

Varieties Malagoba Alphanso Neelam Benisha Mallika Wholesale market Open market Retail price (at APMC) Rs prices per kg (Rs) per Kg 13 40-45 18 60-80 6 30-35 7.5 30-35 14 35-45 Prices of KGM Mango (Rs per Kg) 30-35 45-50 20-25 25-30 30-35

Suggestions to boost direct sale of mango in future

1. Farmers' identity cards should be provided to guanine farmers, that will create trustworthiness among consumers about farmers involved in direct sales. 2. Issuing permission to sell, without harassment at different places across the city. 3. Training should be provided for farmers to improve their marketing communication skills that will in turn improve direct sales. 4. Common packing house facilities need to be provided. 5. Transportation at competitive price should be provided. 6. Formation of growers association will help farmers in collective transportation

Economic benefit of branding and direct sales of mango in Bangalore

To compare the economic benefit realized by direct sales of mangoes in Bangalore city the comparative prices of mango at different markets is presented in the table 11. With marketing of fruits at nearby APMC wholesale market, an example of Mallika variety is taken. Wholesale market price of one tonne of Mallika variety of mango is Rs. 14,000, cost incurred for harvesting transportation, wastage, commission paid to commission agent and other expenses accounts to Rs. 3,500 per tonne and the net returns realized per tonne is Rs. 10,500. For direct sale of the same variety of mango the cost incurred included Rs 750 per tonne labour charges spent for harvesting and grading, transportation from garden to the ripening/ pack house in the city costs Rs 800 per tonne, cost incurred for ripening and packing was Rs 250, rent paid for packing house worked out to be Rs 350 per tonne, Cost of labeled corrugated boxes for selling one tonne of mangoes was observed to be Rs 3600, transportation charges for taking fruits from packing house to sales points was Rs 350, living expenses and labor charge comes to Rs 600 and Percentage of wastage accounted for 10 per cent of produce during grading, ripening and transportation ( it will offset by the saving in the commission charges to have been paid if sold in APMC's through commission agents) and this amounts to Rs 6700. The price at which the fruit was sold by branding and direct sale was Rs 30 per Kg of Mallika variety of mango, i.e., Rs 30,000 per tonne. Net returns realized by the direct sale of one tonne of Mallika variety of mangoes was Rs 23,300. The additional income realized by direct sale of one tonne Mallika variety of mango was Rs 11,800 which works out to be 120 per cent higher income than that realized by the farmers by selling in wholesale markets. By direct sales of branded mangoes, consumers were also benefited in respect of good quality, naturally ripened fruits at a price 20 per cent less than the open market retail price.

Conclusion
Due to this intervention of branding, packing and direct sales of selected verities of mango has resulted in 120 per cent extra net income to the farmers compared to income realized by selling the same varieties in APMC market yard Srinivasapura. This model will be scaled up in the coming season by addressing to the minor lacunas and adding new dimensions.

Problems faced by farmers in direct sale of mangoes

Farmers who participated in direct sales complained about harassment by local businessmen and street vendors, farmers have faced communication problems at sales points, most of the farmers opined that cost of transportation from packing house to sales points was very high since they were using locally available hired vehicles.

P igl, Pg v g u sU P zAi, U.P..P., AUg-65 Eg PgAz

APz Qz gvU Ai
P GvU GvzAi a Z sj zU SAvg igl ir gv QqUwz. Pzgg a zgU gAi gwzg. F jwAi zs j , g Ai P P AidAirAi P zAiz P igl, Pg v g u sU AiVPV i t ePV PAi, VPgt ir, VPV iV, P ir, Aq g Pl, gvjAz gV PzgjU igl iq zs Ai VP V P Vz . g iglz Rj, z t j, v q w g gvjU gV vz... v Rj PlPz gvjU GvdPjAiiUz ! ! ! !

PlP Pgz gAi P P Aid CrAi DAi vlUAz vAz ve i

Pg U i (P.f.JA.)

gvjAz g igl