Development of a better distribution network

Oct 13, 2025 by magicalceylontours.com 57 views

Introduction

The integration of the onion market is a crucial aspect of the economy, particularly in regions where onions are a staple crop. The study aims to examine the cohesiveness or market integration and changes in the price of shallots in the Tuntung Main Market and their relationship with prices in the retailer market. This study uses the price transmission elasticity analysis method with the help of Ms. software, Excel, and Market Connection Index Method (IMC) which is processed through SPSS. The research location was determined purposively, using secondary data obtained from the Medan City Market Regional Company and the Laucih Main Market Market Market Company located in Medan Tuntung District.

Methodology

The study employed a quantitative approach, using secondary data obtained from the Medan City Market Regional Company and the Laucih Main Market Market Market Company. The data was analyzed using the price transmission elasticity analysis method, which measures the responsiveness of prices in the retailer market to changes in prices in the Tuntung Main Market. The study also used the Market Connection Index Method (IMC) to examine the level of market integration between the Tuntung Main Market and the retailer market.

Results

The results of the study showed that changes in the price of shallots in the Tuntung Main Market related to retailers are inelastic, with the value of price transmission elasticity (ET) of 0.57. This value indicates that price changes in the Main Market do not have a significant impact on prices at the retail level. This means that the increase in the price of shallots in the wholesale market is not matched by the same price increase among retailers, so consumers do not experience a surge in prices that are too large when buying shallots.

Further analysis using the IMC method produces a value of 0.454. This value also shows the integration of the market between the main market and retailers in the short term tends to be low, because the value is less than one. This indicates that there is a gap in the regulation and distribution of prices at different market levels.

Discussion

The findings of the study suggest that although there is a relationship between the price of shallots in the Tuntung Main Market and the price in the retailer market, the relationship is still quite weak. This low integration can be caused by various factors, including differences in distribution costs, traders' treatment, or fluctuations in demand and supply in both markets.

Conclusion

This study provides important insights for policy makers and business people, especially in an effort to improve the efficiency of the onion market. To increase market integration, the recommended strategies include the development of a better distribution network, training for traders in setting competitive prices, as well as efforts to increase price information transparency at all market levels.

Recommendations

Based on the findings of the study, the following recommendations are made:

Development of a better distribution network: The study suggests that the development of a better distribution network can help to increase market integration and reduce the gap in prices between the Tuntung Main Market and the retailer market.
Training for traders in setting competitive prices: The study recommends that traders should be trained in setting competitive prices to increase market integration and reduce the gap in prices between the Tuntung Main Market and the retailer market.
Efforts to increase price information transparency: The study suggests that efforts should be made to increase price information transparency at all market levels to increase market integration and reduce the gap in prices between the Tuntung Main Market and the retailer market.

Limitations

The study has several limitations, including:

Limited data availability: The study was limited by the availability of data, which may not be representative of the entire market.
Methodological limitations: The study used a quantitative approach, which may not capture the complexities of the market.
Limited generalizability: The study was conducted in a specific region, which may not be generalizable to other regions.

Future Research Directions

The study suggests several future research directions, including:

Investigating the impact of market integration on consumer welfare: The study suggests that future research should investigate the impact of market integration on consumer welfare.
Examining the role of government policies in market integration: The study suggests that future research should examine the role of government policies in market integration.
Investigating the impact of market integration on small-scale farmers: The study suggests that future research should investigate the impact of market integration on small-scale farmers.

Conclusion

Q: What is the main goal of the study?

A: The main goal of the study is to examine the cohesiveness or market integration and changes in the price of shallots in the Tuntung Main Market and their relationship with prices in the retailer market.

Q: What methods were used in the study?

A: The study used the price transmission elasticity analysis method with the help of Ms. software, Excel, and Market Connection Index Method (IMC) which is processed through SPSS.

Q: What are the results of the study?

A: The results of the study showed that changes in the price of shallots in the Tuntung Main Market related to retailers are inelastic, with the value of price transmission elasticity (ET) of 0.57. This value indicates that price changes in the Main Market do not have a significant impact on prices at the retail level.

Q: What is the significance of the IMC value?

A: The IMC value of 0.454 indicates that the integration of the market between the main market and retailers in the short term tends to be low, because the value is less than one. This indicates that there is a gap in the regulation and distribution of prices at different market levels.

Q: What are the implications of the study?

A: The study provides important insights for policy makers and business people, especially in an effort to improve the efficiency of the onion market. To increase market integration, the recommended strategies include the development of a better distribution network, training for traders in setting competitive prices, as well as efforts to increase price information transparency at all market levels.

Q: What are the limitations of the study?

A: The study has several limitations, including limited data availability, methodological limitations, and limited generalizability.

Q: What are the future research directions?

A: The study suggests several future research directions, including investigating the impact of market integration on consumer welfare, examining the role of government policies in market integration, and investigating the impact of market integration on small-scale farmers.

Q: What are the recommendations for policy makers and business people?

A: The study recommends several strategies to increase market integration, including the development of a better distribution network, training for traders in setting competitive prices, and efforts to increase price information transparency at all market levels.

Q: What are the benefits of the study?

A: The study provides important insights into the integration of the onion market in Medan Tuntung District, Medan City, and suggests several strategies to increase market integration. The study is expected to provide guidelines for the development of a better onion market in Medan Tuntung District, so that it can provide benefits for all parties involved, ranging from producers, traders, to consumers.

Q: What are the potential applications of the study?

A: The study has several potential applications, including improving the efficiency of the onion market, increasing market integration, and reducing the gap in prices between the Tuntung Main Market and the retailer market.

Q: What are the potential implications of the study for the economy?

A: The study has several potential implications for the economy, including improving the efficiency of the onion market, increasing market integration, and reducing the gap in prices between the Tuntung Main Market and the retailer market.