Elaborate the concept and measurement of Market Efficiency.

Answers

If one examines the interests of various individuals who are involved in a marketing process, one reaches the following observations:
-That sellers e.g. farmers will be interested in securing the highest possible returns from the sale of their products
- That the consumers will be concerned about obtaining their supplies at the lowest possible costs
- That there are some individuals or institutions between farmers and consumers who facilitate the flow if the product from the farmer to the consumer. They are known as the middlemen. They are interested in maximizing the profitability of their business activities.
Thus one can generally conclude that there are likely to be conflicts of interest among the various parties involved in a marketing process, therefore some trade offs may have to be made before a business operation can be consummated.

An efficient marketing system is expected to be beneficial to all the parties involved in a marketing process.
Marketing is productive and anyone who is engaged in any of the many marketing functions should be seen as a producer. Production may be defined as the creation of utility in the productive process of a marketing system. Productive processes are classified in FORM utility, PLACE utility, TIME utility and POSSESSION utility. A processor who changes the form of raw material also adds form utility. The transporter adds place utility by moving a product from the production site to the place where it is needed. The storage of a given product between the periods of relative plenty to periods of relative scarcity adds time utility.
The above discussion indicates that marketing is complex and can be fairly costly. The complex process that brings or makes goods in the form that is desired and at the right place and time is often referred to as the marketing machinery. Complex and costly marketing machinery is not necessary in situations where the volume of production is limited. On the other hand, mass production is not feasible until the marketing machinery opens up the doors to the broad mass market. Hence the development of a marketing system and the development of the production system are complementary actions. There is therefore a positive relationship between increased productivity of agricultural production and processes and the development of an adequate marketing system for agricultural products.

marto answered the question on March 15, 2019 at 07:35

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