5.1. Conclusions
5.2. Areas for further research
Ahmed and Rustagi (1987) estimate that more than one-half of the difference in higher marketing costs between Africa and Asia is attributable to poor infrastructures - roads, transport services and wholesale and retail markets. Wholesale markets can play a major role in improving food supply and distribution to cities, especially for perishable produce but also for non-perishables. Their advantages can be seen in terms of:
Wholesale markets can be justified in town or cities with a minimum volume of trade in food produce and where farm households in the main supply zones basically aim at producing for the market rather than for subsistence. Economic growth and development contributes to this latter process but it also facilitates increased vertical integration of production and marketing, especially through supply contracts between farmers and large supermarket chains, thus reducing the relevance of wholesale markets in FSDSs.
Existing network of markets in most African cities are characterized by a number of constraints that contribute to relatively high marketing/distribution costs and deterioration in the quality of produce, and hamper both food production and consumption. These constraints need to be addressed as existing structures are adapted and improved to enhance their efficiency. Wholesale markets should not be construed as mere physical infrastructures or in isolation but rather seen as part of the marketing system as whole. Efficiency of the marketing system is affected by a number of factors including organizational and operating methods and procedures, the regulatory framework, support services and behaviour of various stakeholders. Any sustainable improvement in the efficiency of FSDSs therefore requires concerted effort on the part of all stakeholders, including, in particular, public agencies such as municipal, regional and national authorities. New wholesale markets will not automatically improve efficiency in food marketing, but they can play a major role in an overall strategy to improve the performance of urban FSDSs.
Improving the performance of urban FSDSs requires that food traders be offered technical training especially in accounting, business management and trading strategies in a competitive environment. Women in particular need to be targeted in the training programmes since they dominate food retail activities. Training could be incorporated in credit schemes that target traders. There is considerable scope for popularizing the use of standardized weights and measures in food retailing rather than the more traditional (informal) system involving the use of bags, cups and packets. Dissemination of market information also needs to be improved. The fact that wholesale and retail activities commonly occur in the same markets can severely compromise the value of market information intended for both producers and distributors and would have to be addressed.
5.2.1. Macro/micro-economic studies
5.2.2. Technical issues
5.2.3. Organizational/legal issues
Further policy research aimed at evolving plans and strategies to promote wholesale markets as an integral part of an overall programme to improve efficiency in FSDSs in Africa need to focus on three main areas, namely economic, technical and legal/organizational issues.
The main object of macro/micro economic studies should be to identify possible ways of improving the performance of FSDSs in terms of quantity and quality of produce marketed. The focus of such studies should include food production trends and socio-economic conditions in major production areas; demographic trends in the city; existing distribution networks and the specific features of distributors (wholesalers, retailers and transporters). For effective planning purposes, the studies should also provide a profile of urban consumers covering, among other things, income, household expenditure and food consumption patterns. The process of price discovery and existing formal and informal market information systems also need to be studied.
Technical studies should be concerned with issues pertaining to determination of the optimum size and location for wholesale markets, taking into account overall development plans for cities as well as the expected flow of produce to and from the market. This will, for instance, ensure that the location of wholesale markets minimizes access difficulties for both suppliers and retail market traders. Such studies can also feed into the planning process for cities and ensure the availability of required market facilities including adequate parking space, handling, storage, communication and banking facilities. The studies will also ensure that urban development plans provide for future development and expansion of markets and related infrastructure. Furthermore, the outcome of such studies will be essential inputs in the consultation process among various stakeholders to ensure a programmed development of marketing infrastructure that keeps pace with urban population growth.
The choice of the precise structure of ownership and form of management for wholesale markets is of vital importance and, as earlier stated, depends very much on prevailing political, socio-cultural and economic factors in any particular city. Studies on organizational/legal issues can provide the precise choice of ownership and management structure most conducive to the prevailing institutional environment. It would, for instance, be important in this context to clearly delineate the functional roles of various organizations (public and private) with regard to ownership, management control and regulation of wholesale markets.
To ensure that the outcome of such studies feeds into the policy and planning process, an effective interface needs to be developed between researchers and other stakeholders, including in particular political leaders and bureaucrats. It is important to ensure that reports on the studies are as comprehensive as possible so as to facilitate decision-making on design and implementation of market development projects.
