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1. Lack of Organization:
There is lack of organization among producers. Producers are small and scattered. They have no collective organization of their own to protect their interests.
2. Forced Sales:
The formers are forced to sell their products due to:
i. poverty and prior indebtedness.
ii. Lack of storage facilities.
iii. Time factor, particularly with regard to perishable goods.
3. Existence of Large Number of Middlemen:
There are a large number of intermediaries or middlemen between the producers and the consumers. These middlemen sell the produce to the consumers at a higher price and give lower returns to the producers.
Approximately 50% of the price paid by the consumer goes to middlemen.
4. Multiplicity of Market Charges:
The producers pay numerous and various marketing charges. They are more than 20% of the income of the produce. They pay market charges at different levels such as – commission to the dalal, weigh men charges, brokerage, charges of labourers who help in unloading the cart, etc., apart from the deduction for impurities in the produce by the wholesaler.
5. Multiplicity of Weights and Measures:
There is lack of standard weights and measures. Weights made of sticks, stones, bits of old iron are commonly used in the villages and markets.
The multiplicity of weights and measures employed has many defects:
i. It makes supervision very difficult.
ii. It gives opportunity to cheat the producers.
6. Adulteration:
Due to adulteration, the quality of the produce is reduced. Even the good produces are subjected to customary inclusion of impurities. The adulterants, such as – papaya seeds, are mixed with pepper; chilly powder is mixed with red brick powder supari with sawdust; ghee with vanaspathi; and tea dust with sawdust. Medicines are also adulterated.
7. Inadequate Storage Facility:
Storage facility is far below the requirements in rural and urban areas. The loss due to inadequate storage has been estimated to be 5-15% in weight and quality. Grains lose weights due to the change of weather. Crops like jowar, pulses and maize are found to be infested with insects even before harvest.