Aims: To comprehensively assess organizational performance, financial sustainability, and operational efficiency of Farmer Producer Organizations (FPOs) across diverse agro-ecological zones, while identifying and prioritizing systemic constraints that impede their long-term viability and member value creation.
Study Design: A causal-comparative research design using a mixed-method approach was adopted, combining both quantitative and qualitative tools. Data were collected through a multi-stage sampling process covering different agro-ecological zones to capture regional diversity and context.
Place and Duration of Study: The research was conducted across four agro-ecological zones of Madhya Pradesh: (1) Kymore Plateau and Satpura Hills (Zone 10), (2) Central Narmada Valley (Zone 9), (3) Vindhyan Plateau (Zone 11), and (4) Malwa Plateau (Zone 6), spanning from mid-decade period before 2024.
Methodology: A multi-stage stratified sampling approach selected 24 FPOs (6 from each agro-ecological zone) representing diverse commodities and operational maturity levels. From these FPOs, 480-member farmers (20 per FPO) and 72 board members/managers (3 per FPO) were surveyed. Advanced analytical tools including financial ratio analysis, Garrett's ranking technique, chi-square test, Pearson's correlation analysis, and binary logistic regression were employed for comprehensive assessment.
Results: Analysis revealed significant inter-zonal and intra-zonal performance variations. Only 37.5% (n=9) of FPOs achieved financial sustainability, with net profit margins ranging from -3.8% to +11.2%. Financial ratio analysis showed healthy performers maintained current ratios >1.8, ROE >12%, and asset turnover >2.4. Garrett's ranking identified inadequate working capital as the primary constraint (mean score: 75.34), followed by weak market linkages (mean score: 71.23) and governance challenges (mean score: 68.47). Binary logistic regression revealed professional management (OR=9.23, p<0.01), share capital adequacy (OR=1.89, p<0.05), and market linkage strength (OR=2.14, p<0.01) as strongest predictors of sustainability. Chi-square analysis demonstrated significant associations between board education level and business turnover (?²=24.56, p<0.001), and between professional management and financial performance (?²=19.87, p<0.001). Correlation analysis revealed strong positive relationships between member participation rate and profitability (r=0.684, p<0.01), and between operational maturity and sustainability indicators (r=0.562, p<0.01). Zone-wise analysis showed Malwa Plateau FPOs performed better (50% sustainability rate) compared to Vindhyan Plateau FPOs (25% sustainability rate), attributed to better infrastructure and market access.
Conclusion: The study establishes that FPO sustainability across agro-ecological zones is contingent upon professional management, adequate capitalization, robust governance structures, and strategic market integration. Systemic constraints particularly working capital inadequacy, market access limitations, and governance deficits significantly impede performance irrespective of agro-climatic conditions. However, zone-specific factors including infrastructure availability, market proximity, and institutional support create differential success probabilities, necessitating contextualized intervention strategies for FPO viability enhancement.
Sustainable Development Goals (SDGs) discussed in study: SDG 5 (Gender Equality): 23% of FPO board positions held by women (vs. <10% in traditional cooperatives), SDG 8 (Decent Work): Formalized agricultural employment, fair prices, SDG 10 (Reduced Inequality): collective empowerment & SDG 17 (Partnerships): Multi-stakeholder collaboration model.
International Journal of Agriculture Extension and Social Development
