5 pages

ABM/FIM 100 Decision Making in the Agri-Food System

Cheney-001 Fall 2014

Assignment #1:

The Agri-Food System - Players and Functions

DUE: Tuesday, October 7, 2014

Situation: In this assignment, you will demonstrate your overall knowledge of the agri-food system, your understanding of the eight players and four marketing functions in the agri-food system (time, form, place, and possession values) and your ability to prepare a professional, formal document . To do this, pick a food product of your choice, and commodity ingredient in that food product, and write an essay describing the market channel involved in getting that commodity and food product from the farm to the consumer. The first part of the essay requires a one-page graphical presentation while the second part emphasizes your understanding of the agri-food system and marketing functions. You may choose any food product you like, but it must contain one of the following commodity ingredients:

· Beef	· Any Fruit	· Nuts (e.g., almonds, peanuts, hazelnuts, etc.)
· Poultry & Eggs	· Tomatoes	· Barely or Hops
· Soybeans	· Coffee or tea	· Sugar

If you have a specific commodity of interest that is not listed above, please see your instructor to see if it is acceptable choice for this assignment.

PART I. graphical presentation. Create a one-page diagram of the agri-food system involved in delivering your food product to the final consumer. To do this, follow the commodity ingredient found in your food product through your market channel. For instance, if your food product is Budweiser, your ingredient could be rice and you would follow the rice market channel for Budweiser from the agricultural input supplier to the consumer.

· For your market channel, provide a complete diagram, detailing the flow of the product and the players involved in getting your food product to the final consumer. Your diagram must be originally created on a computer , not hand-written, and it should be one-page only. To create this diagram, software programs such as PowerPoint and Presentations are suggested.

· Your diagram must include the following:

· At each economic stage, provide a general label for the player in the market channel (e.g., “Food Manufacturer”), from agricultural input supplier to consumer.

· Provide a real world example for each general player in your market channel (for example, Anheuser-Busch would be a real world example of a Food Manufacturer and Riceland Foods would be a real world example of an Assembler in the rice market). Bear in mind that you may not be able to determine with certainty that Anheuser-Busch actually buys milled rice from Riceland Foods. That’s okay. The point is that Riceland Foods is a plausible example of the type of firm from whom Anheuser-Busch might purchase milled rice.

· Identify all possible venues that your product will go to once it leaves the manufacturer . For instance, Budweiser beer might go straight to a large retailer, but would go to both types of wholesalers, and then on to various types of retailers (small retail food store and food service retailer).

· Indicate how the commodity/product flows through the agri-food system. For instance, use arrows in your diagram to show from whom a player buys and to whom a player sells.

Note: It is plausible that the market channel for your food product may have more or less firms than the eight players discussed in class. This will be particularly true if one firm performs at more than one economic stage, such as an assembler/processor or processor/manufacturer; or, if you are dealing with a fairly vertically integrated market channel. However, this does not mean that the economic stage should be completely eliminated. Some firm still has to perform the value-adding process, right? For some market channels, it will be okay to show the same firm operating at more than one economic stage or to combine the names of two stages (i.e., processor/manufacturer) provided this reflects the market channel and not lack of research on your part.

PART II. written document. In this section, you will discuss your food product and manufacturer, as well as provide a bit of background on the agricultural commodity. In addition, you will describe and discuss the primary marketing functions (time, form, place and possession) performed by each player in your market channel. In other words, you’ll want to explain what each player in your diagram does and which type(s) of value is added by each player. Specifically, address the following:

A. THE MANUFACTURER - what is your food product and who manufactures it? Example, if you are following the rice market channel for Budweiser beer, your food product is Budweiser beer and your manufacturer would be Anheuser-Busch. Next, research this manufacturer and provide further information regarding this company. At a minimum, address:

1) What is the history of this company? For instance, can you determine when it was established and by whom? Is it a subsidiary of a larger company?

2) Identify the firm’s geographic market - Is it a regional, national or global firm? Where is the company’s headquarters? Where are its manufacturing plants? Where does it sell product?

3) How “big” is the company? Choose three descriptive factors to address this question. For instance: number of employees, sales value/volume, number of manufacturing plants, number of product lines, etc. Make certain that you cite the source of your descriptive statistics. In addition, your descriptive statistics need to be current – data should not be older than 2010, and 2012 or 2013 is preferred.

B. THE COMMODITY – use the newly released 2012 Census of Agriculture to discuss at least two descriptive national statistics regarding your commodity. For instance, you can identify the total number of farms in the U.S., total acres harvested, total value of sales, etc. On the rare chance that your commodity is not grown in the U.S., then use FAOSTAT or another resource to identify how much is produced in the world and the top country in the world that produces the commodity. In either event, be sure to identify exactly what your descriptive statistics are, including the units involved. Below is a sample:

According to the 2012 USDA Census of Agriculture, there are approximately 5,591 rice farms identified in the U.S. Collectively, these farms had a total of $2.895 billion in sales and harvested 2.69 million acres for a total of 20 billion pounds (200,230,288 cwt.) of rice (USDA NASS, 2014). As a side note, rice is only grown in six states in the U.S., with Arkansas accounting for nearly 50% of production (USA Rice Federation 2014).

To access the 2012 Census, you can start at http://www.agcensus.usda.gov/index.php. You might find it easiest to follow the Quick Stats data search tool or open the full report if the query is too confusing. The rice information above was found in both places, but Table 37 at http://www.agcensus.usda.gov/Publications/2012/Full_Report/Volume_1,_Chapter_1_US/

was much easier for this instructor to follow.

C. THE PRIMARY MARKETING FUNCTIONS - describe the primary marketing function(s) performed by each player at each economic stage in your diagram. At each stage, address who the player is and what the player does? How are time, form, place and/or possession value-added by each player ? Below is a sample paragraph describing the primary marketing functions of Riceland Foods in the Rice Market Channel for Budweiser Beer.

At the assembly stage, a firm such as Riceland Foods buys small quantities of rice from many producers and sells large quantities of milled rice to Anheuser-Busch. The firm adds time value to the commodity by storing rice in its grain elevator so the rice can be used by another player at a later date. Riceland Foods also serves as the Initial Processor in the rice market channel because the company mills the rice and sells rice flour and milled products, thereby adding form value. Finally, Riceland Foods adds place value by transporting the milled rice to Anheuser-Busch’s manufacturing plant. Therefore, the significant marketing functions for Riceland Foods are time, form and place value.

III. YOUR REPORT IS EVALUATED BASED ON THE FOLLOWING CRITERIA:

Part I: 20 points total

· 10 points for the overall quality of the diagram (professionalism, clarity, flow, title, etc.)

· 5 points for general names of the players in your market channel (Assembler, Food Retailer, etc.)

· 5 points for specific/example names of the players in your market channel (Cullum Seeds, Anheuser-Busch, etc.)

Part II: 60 points total

· 15 points for discussion of product manufacturer

· 10 points for discussion of commodity using the 2012 Ag Census data.

· 35 points for description of functions/value-added by every player in the system. This includes a description of each player’s role and a discussion of how each player adds time, form, place, and/or possession value. Make sure to include a concluding/summary paragraph at the end of this section.

Overall Professionalism: 20 points total

· 5 points for proper use of citations

· 5 points for proper presentation and use of references, including a reference list (luckily, you can check out the handout provided by your ABM/FIM 100 instructor since there is a required citation and reference style for the assignment)

· 10 points for overall quality: this includes such things as a cover page, title, page numbers, proofreading, general organization, and overall impression.

FINAL COMMENTS:

· This assignment may be done individually or with a partner. See “Contract for Partnership: Assignment #1” if you plan to do this assignment with a partner.

· Use only your PID and your seat ROW/SEAT NUMBER on your assignment. Please DO NOT include your name on your paper.

· This assignment must be typed. Use double spacing, 12-point font, and 1-inch margins.

· The page requirement is 4-6 pages; this includes the reference page and graphic. So that basically means 2-4 pages of written text. Your cover page/title page does not count as part of the page requirement.

· This assignment is due at the start of class on Tuesday, October 7, 2014. Late papers will be penalized under the rules explained in the syllabus and will not be accepted after 5:00 pm on Friday, October 10, 2014.

· In addition to the required hard copy, you will need to submit a back-up copy via the drop box in D2L. Failure to turn in a back-up copy on D2L will result in a 5-point penalty.

· This assignment is based on 100 points and accounts for 15% of your course grade.

· You will need to use the internet for information regarding your product. A paper that demonstrates no research effort will not receive a passing grade. Wikipedia and YahooAnwers are NOT acceptable resource.

· Don’t hesitate to ask your instructor for advice or assistance – that’s what I’m here for! Feel free to send an e-mail, call, or stop by my office.

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