Retail distribution of fruits is a critical area in the marketing channel. Despite understanding the changes, retail fruit marketing is not properly organized. It is reported that fresh fruit retailers generally get more profit than their share in terms of investment and labour. The margin in many cases is as high as 50-60 per cent.

Retailers buy and sell according to the demand of the area, and make transactions in conformity to quality and quantity. Quite a few occupy shops in main fruit markets or in towns, while majority are hawkers, selling from barrows. They move from street to street. Moreover, a number of retailers can be found standing at railway station, bus stand, vicinity of courts, schools and hospitals. There is a high degree of competition among retailers as they buy fruit from wholesalers on credit, and repay the amount the next day. They do not require a license, but experience is more important,and business can be done with small capital. A new entrant has to provide one guarantor to lift the produce on credit, and need to maintain contact with local people.

To measure cost and return at retail level is difficult, only the variable such as loading, unloading, transport charges, storages etc., can be calculated. As retailers deal in different commodities, therefore to allocate cost proportionally is not possible.

The costs included in the analysis are variable costs on per crate basis, and were collected from different towns. The net profit of retailers in these markets is shown in table 1. Table 1: Profit margin of fresh fruit retailers in assembly and wholesale markets.

Results of the analysis indicate that in an assembly market a retailer bears less cost than in the wholesale market. These reflect difference in transportation and labour costs. The return on capital invested has been found attractive due to low capital requirements and operating costs, as a retailer does not employ labour. The costs are fixed like the market tax, and the rent of shop/barrow, which are low. There are some variable costs too, like transportation from market to their local area. The retailers maintain contact for three months, therefore his net profit ranges between Rs4,000 and Rs11,000 per month. The return may appear high but it should be remembered that retail business is time consuming and a full-time occupation. Retailers perform grading and presentation while selling the produce. This is a competitive trade and it is unlikely to continue generating high profits.

An attempt has been made to calculate the net profit margins of growers and other marketing agencies. Table 2: Net profit margin obtained by growers and other market agencies in fresh fruits marketing .

In fresh-fruit marketing, the consumer’s interest is least safeguarded. Although, an efficient marketing system is described to be equally beneficial to both the producer and the consumer, but little has been done in regard to the latter.

The use of grading and packing as an effective merchandising device has started developing, along with the advancement in self-service selling techniques. Questions loom large on the role of a consumer in the radically transformed situation of retail food marketing in future. Are products better or are they simply different from the previous ones. Will multiple size grading and packaging help a consumer to select appropriate items, or it is a technique to confuse about the real cost.

The marketing system has often been viewed as a neutral element providing an important link between the farmer and the consumer. But in fact it is not neutral but has tremendous potential to affect the operation and the welfare of both the farmer and the consumer.