- Email: [email protected]
Marketing of agricultural products (5th edition)
Agricultural
Adminirfrarion
8 (198&81) 401404
BOOK REVIEW
Marketing of Agricultural Products (5th edition), by R. L. Kohls and J. N. Uhl, MacMillan, 1980. Pp. 600. Price: g12.25 (hardback). 57.35 (Paperback). One problem in reviewing the fifth edition of this well known American agricultural marketing text is in saying anything new, particularly when the basic approach and objectives of the book have remained unaltered over twenty-five years. The most noticeable change since 1955 has been the expansion in size: from about 400 pages in the first edition to 600 in the new. This does not all represent additional material, since much of the increase results from changes in presentation: many coming (in this edition) in the form of chapter previews and discussion questions. As well as selected references for each chapter, we now have an annotated bibliography of works on ‘Food Marketing Research, Information and News’ at the lend] of Chapter 16, and a glossary of agricultural marketing and economics terms placed before the index. As in previous editions, this one continues the process of updating and improving those areas that appear to have changed most since the last (in this case in 1972). Both authors are Professors at Purdue University and the book is designed with the American undergraduate college student very much in mind. It is an introductory text, suitable for those with little knowledge of economics, mathematics or statistics and with a mixed approach combining descriptive, functional and analytical techniques. Part I, ‘The Framework of the Marketing Problem’, introduces the topic of food marketing (always ‘food’ rather than ‘agriculture’ in the text, despite the title) by discussing alternative definitions, the one chosen for preference being ‘all business activities involved in the flow of food products and services from producers (farmers) to consumers’. The second chapter in this section reviews various complementary approaches to the study of food marketing-functional, institutional, behavioural and analytical-and enquires into the meaning of marketing efficiency. Chapter 3 gives a description of American agricultural production and the implications for 401 Agricultur-al Administration Printed in Great Britain
(8) (1980-S
1)-o
Applied
Science
Publishers
Ltd,
England,
198 1
402
BOOK
REVIEWS
marketing food within the USA. As a whole, this section deals much more than in previous editions with the complementarity of farm and marketing activities in meeting consumer wants and in criteria for evaluating the food marketing system. ‘Food Markets and Institutions’ forms Part II of the text and begins with an analysis of consumption trends in the USA, concentrating on population and income effects-and changes in taste-leading to the increased consumption of convenience foods and to more eating out. A description of the US food processing, wholesaling and retailing sector in terms of industry structure, location and competition follows and the section ends with a new chapter on the size and importance of international trading in the US market. Part III, on ‘Prices and Marketing Costs’, introduces elementary concepts of demand, supply and prices and briefly reviews simple competition models, although employing only one diagram, on perfect competition. The level of analysis is unambitious and no substitute for an introductory economics text. A discussion of the behaviour of farm prices forms the next chapter and the section ends with a description of food marketing costs for different commodities and a discussion on marketing margins, relative to the farmer’s share of the consumer price. Since the book assumes no economics on the part of the reader, uses only the most elementary models and engages no mathematical techniques other than the simplest graphs and presentations of descriptive statistics, this section remains necessarily limited in depth of analysis, despite the revisions carried out since the last edition. The largest section in the book is Part IV ‘Functional and Organisational Issues’ which comprises a mixture of descriptive material on the changing structure of food markets dealing with specialisation, decentralisation and integration in food marketing, co-operatives, market development-including advertising-market and bargaining power in the food industry, on the one hand, and ‘functional analysis of US food markets on the other. This latter includes: market information, standardising and grading, transportation, storage, risk management and the futures market. Each topic is clearly and simply handled, with useful diagrams and illustrations by hypothetical or actual American examples. Part V is a short section entitled ‘Government and Food Marketing’, although the first of its two chapters deals almost entirely with principles of government intervention in agriculture to stabilise prices and raise incomes, and only marginally or by implication with marketing. The second is a broad review of American food marketing regulations, encompassing competition and anti-trust, internal trade, consumer protection, price controls and agricultural education and research. Again these chapters can only provide an elementary introduction for the serious student interested in government policy towards agricultural and food marketing. The final section, Part VI, reviews briefly, in just over 100 pages, the marketing of the following commodities in the USA: livestock and meat, milk and dairy products; poultry and eggs; grain; cotton and textiles; tobacco and tobacco products. Turning from a description of the contents to a review of possible competing books, two of the most immediately comparable American texts on food marketing
BOOK
REVIEWS
403
are those by Darrah’ and Shepherd et a1.6 The former book, after sensible opening chapters on demand and consumers, undertakes a very comprehensive discussion of food marketing functions, with a rather managerial style to the economics employed. Government involvement in marketing is restricted to one chapter and the marketing arrangements for particular commodities appear only as examples. The latter text aims at a more economic and statistical approach to demand, prices, marketing costs and functions, although still at a relatively elementary level, and devotes a third of its space to commodity marketing in the USA, with particular detail on meat and dairying. Neither the review book nor the two mentioned above attempt the level of price and market analysis of the excellent work by Tomek and Robinson4 the statistical analysis of Shepherd,’ or the concentrated skimming over marketing theory of Dahl and Hammond, .l but none of these texts describes the functional, institutional, or commodity marketing aspects of the subject. For market structure analysis of the US agricultural and food sector there are detailed reviews by Moore and Walsh,3 the National Commission on Food Marketing’ and USDA;’ with many regular and occasional publications on specific commodities and margins from the USDA and other bodies. The UK, by contrast, has very few general works on agricultural and food marketing. Allen9 attempts to cover policies, prices, uncertainty and margins in the marketing of UK agricultural products in general, as well as more specific details on certain commodities. The two works by Butterwick and Neville-Rolfe’1’12 devote much of their space to agricultural policies, some of which involve intervention in agricultural markets and the establishment and sanction of statutory marketing bodies. The latter book provides a very useful, if rather brief, summary of the IJK marketing systems for the main agricultural commodities. Details of the food marketing chain are perhaps best obtained from the major investigations over the past 2.5 years, chaired by Britton, lo Verdon-Smithi and Runciman,14 with helpful material on the manufacturing and distribution of specific products from reports produced by the Monopolies and Mergers Commission, the National Board for Prices and Incomes and the Price Commission. Butterwick and Neville-Rolfe” offer a readable chapter on recent changes in marketing activities resulting principally from economic growth, an issue deveioped at length by OECD.16 General developments in UK food retailing, wholesaling and manufacturing have been described by various reports from the Institute of Grocery Distribution and the Office of the Director General of Competition, Commission of European Communities. A great deal of the book under review involves descriptions of the US agricultural marketing systems. This is most obvious in the six chapters on Commodity Marketing, the sections on Government and Food Marketing, and on the Food Markets and Institutions, but it is apparent in every chapter of the book in its basic approach, examples, and virtually every reference. For the non-American reader this may be a disadvantage, especially when other American texts discuss the marketing functions more fully, for example, that of Darrah,2 or price and market
404
BOOK
REVIEWS
analysis with greater depth, for example, Tomek and Robinson;4 and these principles are less related to one country’s experience, but rather are of wide and general applicability. However, for the student with little economic background, the text by Kohls and Uhl provides a very clear, easily read and well presented introductory book on agricultural marketing, embracing a number of different but complementary approaches to the subject. There is no direct competitor by a UK author known to the reviewer; and the general marketing principles are applicable, and the US examples not completely without relevance, to the European situation. Perhaps the exclusively American orientation of the text makes it least helpful to the student who is interested in food marketing in low income countries, or in problems of international trade in agricultural commodities.
REFERENCES
USA DAHL, D. C. & HAMMOND, J. W. Market and price analysis, McGraw Hill, 1977. DARRAH, L. B., Food marketing, Ronald Press Company, 1971. MOORE, J. R. &WALSH, R. G. Market structure of the agricultural industries, Iowa State UP, 1966. TOMEK, W. G. & ROBINSON, K. L., Agricultural product prices, Cornell UP, 1972. SHEPHERD, G. S. Agricultural price analysis (6th edition). Iowa State UP, 1968. SHEPHERD, G. S., FUTRELL, G. A. &STRAIN, J. R., Marketingfarmproducts(6th edition), Iowa State UP, 1976. 7. NATIONAL COMMISSION ON FOOD MARKETING. Food from Farmer to Consumer, US Government Printing Office, 1966. 8. USDA. Market structure of the food industries, 1972. 1. 2. 3. 4. 5. 6.
UK ALLEN, G. R., Agricultural marketing policies, Blackwell, 1958. BRITTON, D. K., Cereals in the United Kingdom, Pergamon Press, 1969. BUTTERWICK, M. & NEVILLE-ROLFE, E., Foodfarming and the Common Market, Oxford UP, 1968. BUTTERWICK, M. & NEVILLE-ROLFE, E. Agricultural marketing and the EEC, Hutchinson, 1971. COMMITTEE OF INQUIRY INTO FATSTOCK AND CARCASE MEAT MARKETING AND DISTRIBUTION. HMSO 1964 (Verdon Smith Report). 14. COMMITTEE ON HORTICULTURAL MARKETING. HMSO 1957 (Runciman Report). 15. MAFF Household Food Consumption and Expenditure (Annual Report of National Food Survey Committee). 9. 10. 11. 12. 13.
General 16.
OECD,
Food
Marketing
and Economic
Growth,
OECD,
1970.
J. A.
BURNS
ERRATUM
The review of In Defence of the Irrational Peasant by Kusum Nair (The University of Chicago Press, Chicago and London, 19793, which appeared in Agricultural Administration, Vol. 8, No. 2, pp. 159-60, was by A. H. Bunting.
Adminirfrarion
8 (198&81) 401404
BOOK REVIEW
Marketing of Agricultural Products (5th edition), by R. L. Kohls and J. N. Uhl, MacMillan, 1980. Pp. 600. Price: g12.25 (hardback). 57.35 (Paperback). One problem in reviewing the fifth edition of this well known American agricultural marketing text is in saying anything new, particularly when the basic approach and objectives of the book have remained unaltered over twenty-five years. The most noticeable change since 1955 has been the expansion in size: from about 400 pages in the first edition to 600 in the new. This does not all represent additional material, since much of the increase results from changes in presentation: many coming (in this edition) in the form of chapter previews and discussion questions. As well as selected references for each chapter, we now have an annotated bibliography of works on ‘Food Marketing Research, Information and News’ at the lend] of Chapter 16, and a glossary of agricultural marketing and economics terms placed before the index. As in previous editions, this one continues the process of updating and improving those areas that appear to have changed most since the last (in this case in 1972). Both authors are Professors at Purdue University and the book is designed with the American undergraduate college student very much in mind. It is an introductory text, suitable for those with little knowledge of economics, mathematics or statistics and with a mixed approach combining descriptive, functional and analytical techniques. Part I, ‘The Framework of the Marketing Problem’, introduces the topic of food marketing (always ‘food’ rather than ‘agriculture’ in the text, despite the title) by discussing alternative definitions, the one chosen for preference being ‘all business activities involved in the flow of food products and services from producers (farmers) to consumers’. The second chapter in this section reviews various complementary approaches to the study of food marketing-functional, institutional, behavioural and analytical-and enquires into the meaning of marketing efficiency. Chapter 3 gives a description of American agricultural production and the implications for 401 Agricultur-al Administration Printed in Great Britain
(8) (1980-S
1)-o
Applied
Science
Publishers
Ltd,
England,
198 1
402
BOOK
REVIEWS
marketing food within the USA. As a whole, this section deals much more than in previous editions with the complementarity of farm and marketing activities in meeting consumer wants and in criteria for evaluating the food marketing system. ‘Food Markets and Institutions’ forms Part II of the text and begins with an analysis of consumption trends in the USA, concentrating on population and income effects-and changes in taste-leading to the increased consumption of convenience foods and to more eating out. A description of the US food processing, wholesaling and retailing sector in terms of industry structure, location and competition follows and the section ends with a new chapter on the size and importance of international trading in the US market. Part III, on ‘Prices and Marketing Costs’, introduces elementary concepts of demand, supply and prices and briefly reviews simple competition models, although employing only one diagram, on perfect competition. The level of analysis is unambitious and no substitute for an introductory economics text. A discussion of the behaviour of farm prices forms the next chapter and the section ends with a description of food marketing costs for different commodities and a discussion on marketing margins, relative to the farmer’s share of the consumer price. Since the book assumes no economics on the part of the reader, uses only the most elementary models and engages no mathematical techniques other than the simplest graphs and presentations of descriptive statistics, this section remains necessarily limited in depth of analysis, despite the revisions carried out since the last edition. The largest section in the book is Part IV ‘Functional and Organisational Issues’ which comprises a mixture of descriptive material on the changing structure of food markets dealing with specialisation, decentralisation and integration in food marketing, co-operatives, market development-including advertising-market and bargaining power in the food industry, on the one hand, and ‘functional analysis of US food markets on the other. This latter includes: market information, standardising and grading, transportation, storage, risk management and the futures market. Each topic is clearly and simply handled, with useful diagrams and illustrations by hypothetical or actual American examples. Part V is a short section entitled ‘Government and Food Marketing’, although the first of its two chapters deals almost entirely with principles of government intervention in agriculture to stabilise prices and raise incomes, and only marginally or by implication with marketing. The second is a broad review of American food marketing regulations, encompassing competition and anti-trust, internal trade, consumer protection, price controls and agricultural education and research. Again these chapters can only provide an elementary introduction for the serious student interested in government policy towards agricultural and food marketing. The final section, Part VI, reviews briefly, in just over 100 pages, the marketing of the following commodities in the USA: livestock and meat, milk and dairy products; poultry and eggs; grain; cotton and textiles; tobacco and tobacco products. Turning from a description of the contents to a review of possible competing books, two of the most immediately comparable American texts on food marketing
BOOK
REVIEWS
403
are those by Darrah’ and Shepherd et a1.6 The former book, after sensible opening chapters on demand and consumers, undertakes a very comprehensive discussion of food marketing functions, with a rather managerial style to the economics employed. Government involvement in marketing is restricted to one chapter and the marketing arrangements for particular commodities appear only as examples. The latter text aims at a more economic and statistical approach to demand, prices, marketing costs and functions, although still at a relatively elementary level, and devotes a third of its space to commodity marketing in the USA, with particular detail on meat and dairying. Neither the review book nor the two mentioned above attempt the level of price and market analysis of the excellent work by Tomek and Robinson4 the statistical analysis of Shepherd,’ or the concentrated skimming over marketing theory of Dahl and Hammond, .l but none of these texts describes the functional, institutional, or commodity marketing aspects of the subject. For market structure analysis of the US agricultural and food sector there are detailed reviews by Moore and Walsh,3 the National Commission on Food Marketing’ and USDA;’ with many regular and occasional publications on specific commodities and margins from the USDA and other bodies. The UK, by contrast, has very few general works on agricultural and food marketing. Allen9 attempts to cover policies, prices, uncertainty and margins in the marketing of UK agricultural products in general, as well as more specific details on certain commodities. The two works by Butterwick and Neville-Rolfe’1’12 devote much of their space to agricultural policies, some of which involve intervention in agricultural markets and the establishment and sanction of statutory marketing bodies. The latter book provides a very useful, if rather brief, summary of the IJK marketing systems for the main agricultural commodities. Details of the food marketing chain are perhaps best obtained from the major investigations over the past 2.5 years, chaired by Britton, lo Verdon-Smithi and Runciman,14 with helpful material on the manufacturing and distribution of specific products from reports produced by the Monopolies and Mergers Commission, the National Board for Prices and Incomes and the Price Commission. Butterwick and Neville-Rolfe” offer a readable chapter on recent changes in marketing activities resulting principally from economic growth, an issue deveioped at length by OECD.16 General developments in UK food retailing, wholesaling and manufacturing have been described by various reports from the Institute of Grocery Distribution and the Office of the Director General of Competition, Commission of European Communities. A great deal of the book under review involves descriptions of the US agricultural marketing systems. This is most obvious in the six chapters on Commodity Marketing, the sections on Government and Food Marketing, and on the Food Markets and Institutions, but it is apparent in every chapter of the book in its basic approach, examples, and virtually every reference. For the non-American reader this may be a disadvantage, especially when other American texts discuss the marketing functions more fully, for example, that of Darrah,2 or price and market
404
BOOK
REVIEWS
analysis with greater depth, for example, Tomek and Robinson;4 and these principles are less related to one country’s experience, but rather are of wide and general applicability. However, for the student with little economic background, the text by Kohls and Uhl provides a very clear, easily read and well presented introductory book on agricultural marketing, embracing a number of different but complementary approaches to the subject. There is no direct competitor by a UK author known to the reviewer; and the general marketing principles are applicable, and the US examples not completely without relevance, to the European situation. Perhaps the exclusively American orientation of the text makes it least helpful to the student who is interested in food marketing in low income countries, or in problems of international trade in agricultural commodities.
REFERENCES
USA DAHL, D. C. & HAMMOND, J. W. Market and price analysis, McGraw Hill, 1977. DARRAH, L. B., Food marketing, Ronald Press Company, 1971. MOORE, J. R. &WALSH, R. G. Market structure of the agricultural industries, Iowa State UP, 1966. TOMEK, W. G. & ROBINSON, K. L., Agricultural product prices, Cornell UP, 1972. SHEPHERD, G. S. Agricultural price analysis (6th edition). Iowa State UP, 1968. SHEPHERD, G. S., FUTRELL, G. A. &STRAIN, J. R., Marketingfarmproducts(6th edition), Iowa State UP, 1976. 7. NATIONAL COMMISSION ON FOOD MARKETING. Food from Farmer to Consumer, US Government Printing Office, 1966. 8. USDA. Market structure of the food industries, 1972. 1. 2. 3. 4. 5. 6.
UK ALLEN, G. R., Agricultural marketing policies, Blackwell, 1958. BRITTON, D. K., Cereals in the United Kingdom, Pergamon Press, 1969. BUTTERWICK, M. & NEVILLE-ROLFE, E., Foodfarming and the Common Market, Oxford UP, 1968. BUTTERWICK, M. & NEVILLE-ROLFE, E. Agricultural marketing and the EEC, Hutchinson, 1971. COMMITTEE OF INQUIRY INTO FATSTOCK AND CARCASE MEAT MARKETING AND DISTRIBUTION. HMSO 1964 (Verdon Smith Report). 14. COMMITTEE ON HORTICULTURAL MARKETING. HMSO 1957 (Runciman Report). 15. MAFF Household Food Consumption and Expenditure (Annual Report of National Food Survey Committee). 9. 10. 11. 12. 13.
General 16.
OECD,
Food
Marketing
and Economic
Growth,
OECD,
1970.
J. A.
BURNS
ERRATUM
The review of In Defence of the Irrational Peasant by Kusum Nair (The University of Chicago Press, Chicago and London, 19793, which appeared in Agricultural Administration, Vol. 8, No. 2, pp. 159-60, was by A. H. Bunting.