ABSTRACT

The study conducted in Krishna district of Andhra Pradesh during 2023-24, aimed to assess the business performance of Farmer Producer Organizations (FPOs). Seven FPOs’ were purposively selected for the study as these FPOs’ are known for better functioning in the recent past. The sample comprised 147 respondents, with 15 member Famers and 6 BODs from each FPO, totalling 21 members from each of the 7 FPOs. Opinions on various FPO activities were gathered from the sample farmers and analysed using descriptive statistical tools. It was found that over one-third (36%) of the members reported a medium level of satisfaction with the services provided by their FPO. Only provision of inputs and extension activities taking place in all FPOs, whereas marketing and custom hiring activities were not performing well. The evaluation of FPO performance through liquidity ratios—current ratio, quick ratio, and liquid assets to total assets ratio—indicated satisfactory results. However, solvency ratios were unsatisfactory, with an unfavourable debt-equity ratio due to the FPOs' reliance on government funding. Profitability and efficiency ratios of FPOs were found to be non-satisfactory due to less profit compared to shareholders equity and higher external funds, indicating lower returns on investment. Sample FPOs encountered various challenges related to their members of which competition from other agencies noticed as the major constraint and lack of financial support for BODs as a major constraint. The study concluded that the FPOs have not achieved significant growth in expanding their services to meet the diverse needs of their members due to inadequate financial support as major concern was expressed by all FPOs’.