What are the Advantages and Importance of Grading?

ADVANTAGES AND IMPORTANCE OF GRADING:

Grading in general is helpful to all the stockholders in agro-related activities: the farmers, traders, co-operative and the ultimate consumers. The advantages of grading are:

1. Production of Large Scale:

Goods are produced on a large scale, as grading of goods helps in increasing its demand. It becomes easy for a producer to produce these goods on a large scale as goods are graded.

2. Increase in Sales:
Customers do not bother to enquire about the goods graded, as they are very easy to be sold. Therefore, marketing of graded goods becomes easy.

3. Quality Certainty:
Certainty provides producers a reasonable price for their products and provides standard goods of uniform quality to customers at reasonable prices. It helps the producers as well as the buyers.

4. Helpful In Financial Management:
For the financial management of the enterprise graded products are very helpful. These products can be used easily, as security loans can be arranged as security of these products.

5. Helpful in Future Contracts:
Supply contracts may be entered into future for graded products as the identification of graded products become easy and different types of products are divided into different groups.

6. It makes price more reasonable to grades and there will be difference in price as per quality.

7. Simplification of storage and marketing of different grades.

8. Loans can be given based on stored goods as per the grade and’

9. Easier to understand quality available for each grade in case of bulk sale.

10. Based on grades, quality and quantity, it is easy to estimate value for loans against stock.

11. Price comparison by consumers is easy to due to grade identity. The buyer expects least or no risk in his purchases.

12. Grading helps to create perfect competition in the market as it will set a good standard of equivalent grades and materials competition.

13. Overall marketing cost can be reduced as repeat evaluation, spot separation (grading) and doubts in the mind on consumers are avoided.