Economic Effectiveness of Activities of Vegetable Growers’ Associations in Serbia

Taking into account that agriculture is one of the most important parts of economy of Republic of Serbia, it is necessary to pay special attention to its improvement. One of ways to significantly incentive agricultural development is formation of farmers’ associations, primarily because Serbian agricultural production is based at small family farms. It is very important to form such associations among vegetable producers, because they are small scale producers and encounter many problems in business operations. Thus, the paper deals with economic effect s which are possible to achieve for small farmers by involving in growers’ associations. Farmers who are members of associations have an opportunity to sale their products to big retail chains, as well to export vegetables, and get higher price for their products. Along with income improvement, they may reduce production costs and sale costs. Consequently, member¬ship in growers’ associations provides higher profit for small family farms. Analysis showed that associations should primarily take care about relation with their customers, because changes of vegetable prices could increase farmers’ profit more than costs reduction. To achieve their goals such associations need serious state support, as well as support from various other organizations.