INTRODUCTION TO AGRI-BUSINESS • This sector provides 75% of the input used

in production agriculture.
• Agribusiness is one of the most challenging
• Improvements in the quality of purchased
businesses today.
inputs have been a large source of efficiency
• Agribusiness has held up a large share of business
niche. The volume of agribusiness is flourishing day- gains for the entire system.
by-day.
PRODUCTION SECTOR
• The term agribusiness coined first in 1957 by
Goldberg and Davis. • Aims at producing crops, livestock and other
• Agribusiness is not mere a business rather it is an products.
useful tool for ensuring food security throughout the
• has been the cause of much of the change
world and all sorts of basic needs as most of the basic
in agribusiness. They, in turn, have been
requirements are filled up directly or indirectly with
agro products. changed by development in other areas of
• In near future agribusiness will be the central agribusiness, particularly in technology.
metaphor of business system for not only in our
PROCESSING/ MANUFACTURING SECTOR
country but also to the whole world

AGRICULTURE- art of cultivating various categories of

crops including animal husbandry, forestry, fishery, and
other related activities.

BUSINESS- an economic unit, aims to sell goods and

services to customers, at prices that will provide an
adequate return to its owners, commercialization of any
enterprise.

AGRIBUSINESS- is the sum total of all operations involved

in the manufacture and distribution production activities
on the farm and the storage, processing and distribution of
farm commodities from them (Goldberg and Davis, 1957).
Ex. Agri chemicals companies, Veterinary Supply
Companies, Livestock Supply Companies, Biotechnology
Firms, etc.

OBJECTIVES OF AGRIBUSINESS

• Develop a competitive and sustainable private

sector led agribusiness sector.
• Increase productivity/ reduce yield gaps.
• Commercialization of agriculture
• Advance high potential sectors: horticulture,
livestock, and fisheries
• Use of modern technologies
• Reducing cost of production
• Value Addition
• Export Agriculture

THE AGRIBUSINESS SYSTEM

INPUT SECTOR

• Provides producers with the feed, seed,

credit, machinery, fuel, chemicals, they
need to operate.
TYPES OF CUSTOMERS SOLUTIONS:

CUSTOMER vs CONSUMER • Listen allow him/her to talk first

• Express your points as suggestions clearly
Customer: the one who buys the product.
• Be courteous but firm
Consumer: the one who uses the product.
• UNCERTAIN CUSTOMER
INTERNAL vs EXTERNAL CUSTOMERS
• Non demanding
Internal customers: are your employees, colleagues, and • Indecisive and Unsure
stakeholders who depend on your products, services, or • Evasive
processes.
• Seeks Assurance
External customers: are the end-users, clients, or
SOLUTIONS:
consumer who pay for your products or services.

LOYAL CUSTOMERS: They represent no more than 20 • Maintain eye contact

percent of our customer base but make up more • Break Barriers
than 50 percent of our sales. • Listen
• Ask the right questions
DISCOUNT CUSTOMERS: They shop in our stores
frequently, but make their decisions based on the • KNOWLEDGEABLE CUSTOMER
size of our markdowns. • Demanding
NEED-BASED CUSTOMERS: They have a specific • Technically sound
intention to buy a particular type of item. • Good knowledge about the product

IMPULSE CUSTOMERS: They do not have buying at SOLUTIONS:

the top of their “TO DO” list but come into the store • Satisfy his desire for detail
on a whim. They will purchase what seems good at
• No Fooling him
the time.

WANDERING CUSTOMERS: They have no specific • FRIENDLY CUSTOMER

need or desire in mind when they come into the • Talkative
store. Rather, they want a sense of experience. • Discusses a lot
• Warm & Good natured
CUSTOMERS IN TERMS OF BEHAVIOR
SOLUTIONS:
• Tough or Aggressive
• Uncertain Customer • Respond to warmth and hospitality
• Irate or Angry Customer • Keep to business
• Business like Customer
• Knowledgeable Customer
• ANGRY OR IRATE CUSTOMER
• Friendly Customer
• Impatient
• Argues
• Does not listen
CHARACTERISTICS OF THE CUSTOMERS AND
SOLUTIONS TO HANDLING THEM SOLUTIONS:

• TOUGH OR AGGRESSIVE CUSTOMER • Be assertive-in control- not angry

• Egoistic • Be polite to the point
• Impatient • Calm & Clear voive
• Harsh • Don’t give hollow promises
• Emphasize
 distributors, to access resources, share knowledge, and
• BUSINESS LIKE CUSTOMER expand your network.
• Crisp and to the point Market Research and Analysis
• Appreciation
• Avoids waste of time & Procrastination -Understanding Consumer Demands Analyze consumer
preferences, market trends, and competitor strategies to
identify lucrative market segments and tailor your products
or services accordingly.
PLANNING, ORGANIZING, AND IDENTIFYING -Commodity Analysis Study commodity prices, global
BUSINESS OPPORTUNITIES IN THE supply and demand dynamics, and trade patterns to make
AGRICULTURAL SECTOR informed decisions regarding crop selection, pricing, and
trade opportunities.
Overview of the Agricultural Sector
-Local Market Assessment Explore local markets, such as
1. Diverse and Vital farmers' markets and community-supported agriculture
(CSA) programs, to gauge consumer demand for organic and
The agricultural sector encompasses a wide range of locally sourced products.
activities, including crop production, livestock farming,
aquaculture, and more. It plays a vital role in feeding the Developing a Business Plan
population and contributes to the economy.
Setting Goals
2. Trends and Challenges
Clarify your vision, mission, and set specific, measurable,
From sustainable farming practices to technological achievable, relevant, and time-bound (SMART) goals to
advancements, the sector is constantly evolving. However, guide your business endeavors in the agricultural sector.
challenges like climate change and resource scarcity pose
significant hurdles that require innovative solutions. Market Positioning

Define your unique selling proposition (USP) and develop a

3. Economic Potential
strong brand identity to differentiate yourself from
Global demand for food and agricultural products continues competitors and attract your target audience.
to grow, presenting abundant opportunities for businesses.
Financial Projections
Understanding market dynamics and consumer preferences
is crucial for success. Create realistic financial projections, including sales
forecasts, operational costs, and potential risks, to secure
Identifying Opportunities in the Sector
funding and demonstrate the financial viability of your
1. Research & Analysis venture.

Conduct thorough market research to identify emerging Organizing Resources and Financing
trends, gaps in the market, and consumer needs. Analyze
data and gather insights to inform your decision-making 1. Acquiring Assets
process.
Identify and acquire the necessary resources and assets,
2. Technological Innovations such as land, equipment, and technology, to support your
agricultural business operations effectively.
Explore how advancements in agriculture technology, such
as precision agriculture and vertical farming, can be 2. Financial Options
leveraged to capitalize on new opportunities and improve
efficiency. Explore various financing options, including loans, grants,
and investors, and develop a comprehensive financial
3. Collaboration & Partnerships strategy to fund your agricultural venture.

Build strategic partnerships with other stakeholders in the 3. Supply Chain

agricultural sector, such as farmers, suppliers, and
Management Establish efficient supply chain partnerships, • Animal Systems Pathway
streamline logistics, and ensure prompt delivery to meet - Careers in this pathway work with large animals, small
customer demands and maintain product freshness and animals, wildlife animals, and research animals.
quality.
• Power, Structure and Technical Systems
Implementation and Monitoring - Careers in this area deal with power, structures, controls,
geospatial technology, computer systems, electronics,
1. Execution of the Plan
hydraulics, and pneumatics.
Implement your business plan by allocating resources,
coordinating activities, and monitoring progress to ensure
• Natural Resource Systems
that your agricultural venture is on track.
-Careers in this area deal with habitat conservation, forest
products, parks and recreation, fisheries, soil conservation
2. Performance Tracking and much more!
Regularly assess key performance indicators (KPIs) and
metrics to evaluate the success of your business. Adjust
• Environmental Service Systems
strategies and operations as required to optimize
- Careers in this pathway deal with pollution prevention,
performance.
water & air quality, hazardous materials, solid waste
management, and health & safety sanitation.
3. Adaptation & Improvement
Remain adaptable to evolving market conditions and
• Agribusiness Systems
consumer demands. Continuously seek opportunities for
- Careers in this area deal with sales, service, farm and
improvement and innovation to stay ahead in the
ranch management, entrepreneurship, and economics.
agricultural sector.

WHAT IS AGRIBUSINESS?
-An industry engaged in the production, operations of a
farm, he manufacture and distribution of farm equipment
➢ COURSEPACK and supplies, and the processing, storage, and distribution
of farm commodities – Mirriam-Webster Collegiate
LESSON 1. INTRODUCTION TO AGRI-BUSINESS Dictionary

A Career is……

• A chosen pursuit; a field, a profession or occupation. LESSON 2. SIZE AND LAND MANAGEMENT IN
• A career is a life-work path chosen by a person to use AGRICULTURAL
personal talent and skills, provide some service or
goods, earn money, and contribute to society. An entrepreneurial farmer has the initiative, drive, capacity
• Careers are those the particular occupation for which and ability to take advantage of opportunities.
you are trained.
• Farming Exclusively for home consumption with rarely
any surpluses produced;
In agriculture, there are different career pathways, • Farming mostly for home consumption, but with the
to mention few, these are: intention of selling surpluses on the market;
• Farming Partly for the market and partly for home
• Food Products and Processing Systems consumption; or
- The careers in this area deal with food processing and • Farming Exclusively for the market.
preserving, packaging, distribution, government
monitoring & regulation)

LAND MANAGEMENT
• Plant Systems Pathway
- deal with jobs related to agronomy, horticulture, forestry, Agricultural entrepreneurs are strategic in their
turf, viticulture, and soils. planning and implementation. They look at their farm
businesses from a broad and long-time view. They make
sure that every aspect of their farm businesses supports product through capacity expansion, replication and
the goals and objectives they set. They look at ways to modernisation.
strengthen the competitiveness of the farm business
through satisfying buyers, achieving performance targets DIFFERENTIATING THE PRODUCT. Farmers make their
and staying focused on realising the long-term goals of the produce different and better than those among their
business. competitors. The farmers works hard to create unique
perceptions about his product. To achieve this, production
Having a strategy helps a farmer make good choices. It and marketing processes should be different from those of
helps a farmer to make a sure step consistent with long- competitors in order for the product to match what buyers
term goals. It usually answers the questions: need. With this, farmers can charge a higher price.

• What do I need to do to compete, progress and INTEGRATING. There are two kinds of integration,
meet my goals? horizontal and vertical. Vertical integration is where the
• How does the decision I am about to make farm controls or is involved in one or more ‘links’ in the
contribute to my goals? value chain. The farm may integrate ‘forward’ into
processing products, or ‘backwards’ into supplying inputs.
Income increasing strategies Farmer-entrepreneurs Joining other farms to produce the same product is
can create value through different strategies, such horizontal integration.
as: diversify; lower costs; expand the size of the
business; add value to the enterprise; specialise;
differentiate the product; integrate. These strategies
LESSON 3 PLANNING, ORGANIZING AND
come in cycles.
IDENTIFYING BUSINESS OPPORTUNITIES IN THE
DIVERSIFYING. To diversify is to increase the number of AGRICULTURAL SECTOR
products being produced and sold. In this way, it increases
Farmer-entrepreneurs see their farms as a business and
the sources of income, which spreads the risk of loss.
look at them as a means of earning profit. They enjoy
Successful diversifications check on resources that were
independence and freedom.
not utilized on farms. (Farmers also need to consider the
demands of the market.) Entrepreneurs also face risks, work under pressure and are
immediately accountable for whatever outcomes made
LOWERING COSTS. Means focusing on farm produce at out of their decisions.
the lowest possible cost. It is the most common strategy
used in farming. This includes focusing on less expensive Farmer-entrepreneurs may be free and independent, but
resources and inputs but more efficiency on systems. they are not alone in running their business. They operate
Products cost less, they can be sold at lower price, thus, in a complex and dynamic environment.
more competitive prices in the market which generate
more profits. Figure 4. The world of the farmer- entrepreneur

EXPANDING THE SIZE OF THE BUSINESS. Activities Illustrated in Figure 4, are the factors that affect the
agricultural business. Presentation shows four (4) major
include increasing sales, physical and financial assets of the
aspects namely: weather, social environment, economy
farm. Physical expanding the size of the farm can be in
and political environment. Indicators include supplier
different forms like: capacity expansion, replication and
inputs, government, competitors, extension workers,
modernization. However, this works more if the farm is
already profitable and competitive. agents, markets, commercial services, finance agencies
and technology support.
ADDING VALUE TO THE ENTERPRISE. One way to
There are maybe other factors that you might consider
increase the income of the products is by adding value to
which are not listed above depending on the diversity of
existing or diversified products. Adding value normally
your farm products. To make sure their farm businesses
depends on buyer needs.
develop and adapt in response to these changes, farmer
SPECIALISING. This involves reducing the number of entrepreneurs need to:
varieties of farm produce to give full attention to the
• Stay focused on their purpose;
particular product of the farmer. When farmers specialise,
• Do their best to turn every event to their
they tend to develop the product specially to meet
advantage;
market demands. They will also expand the volume of the
• Seize every opportunity and make the best of it;
 • Make the whole system work in their favour.

When a farmer goes into farming, they should study

different stages of development that the enterprise goes
through. The skills of the farmer must also change and
develop to meet the management demands of the
enterprise.

The development of a farm enterprise as a business

occurs in five phases:

• Establishment

Farming business at this stage is quite simple. Where

challenges are more on market potential, on motivation of
the farmer, on the availability of resources and on
fundamental business skills.

• Survival

In overcoming this phase, they need to consider the

following guide questions: Can I generate enough income
to break-even in the short-run and to replace capital
equipment? • Can I generate enough income to expand or
diversify production according to market demands to
ensure long-term viability?