The producer is a natural person or legal entity that produces goods or services with the aim of increasing profit, incurring costs related to the design and manufacturing of the goods or performing services. Producer who produces a harmful product is responsible for the damage caused by this product.
Agricultural producers are natural or legal person or entity without legal personality, which produces agricultural products. These entities must keep agricultural holdings or lead agricultural activities in the field of special branches of agricultural production.
Group of agricultural producers to operate as an entrepreneur must meet the following prerequisites:
- They must act on the basis of a contract or status ("certificate of incorporation"),
- Group must be created by the producers of one agricultural product or group of products,
- Group should determine internal production rules,
- Must consist of members or shareholders – none of them may not have more than 20% of the vote at a general meeting or a meeting of shareholders,
- Revenues from sales of products (product groups) produced on farms members of the group are to constitute more than half of group revenue from sales of products or groups of products.
A farmer agrees to produce and deliver the exact quantity of agricultural products of particular types, company contracting this should receive the products within the agreed time, pay the agreed price, and meet certain additional benefits.
Types of producers
Producers can be divided according to the following categories:
- large scale producers (for example, clothing manufacturers, producers of juices.)
- Serial producers (e.g., manufacturers of aircraft)
- Make-to-order producers Performing specific and reproducible production, which occurs in one or more copies (for example, production of ship, building of the bridge, making software for a specific purpose)
- Chase, R. B., Aquilano, N. J., & Jacobs, F. R. (1995). Production and operations management: manufacturing and services.
- Knorringa, P. (1995). Economics of collaboration in producer-trader relations. Transaction Regimes Between Markets and Hierarchy in the Agra Footwear Cluster. Den Haag: CIPDATA, Koninklijke Bibliotheek.
- Moulaert, F., & Daniels, P. W. (1991). Advanced producer services: beyond the micro-economics pf production. Belhaven Press.
- Van Marrewijk, C., Stibora, J., De Vaal, A., & Viaene, J. M. (1997). Producer services, comparative advantage, and international trade patterns. Journal of International Economics, 42(1), 195-220.