Determining the Structure of Saffron Target Markets and Analyzing Its Impact on Iranian Exports

Considering increasing competition in global markets, it is important to have a comprehensive understanding of target markets for market planning. One of the factors influencing international marketing strategies selection is assessment of the market structure in importing countries. Therefore, this study has pursued two main goals of determining the market structure of important saffron importing countries and investigating the effect of this variable on Iranian saffron to further the research literature on saffron export as one of the most important export products of the Iranian agricultural sector. To achieve these objectives, the Herfindahl-Hirschman Index has been used to calculate the market structure and the gravity model has been applied to determine this variable’s impact on Iran's exports over the period of 2001-2017. Market structure results showed that out of the 16 main countries importing saffron, no country had a fully competitive structure and there was a degree of monopoly in all markets. Also, the results of changes in the market structure of saffron importing countries during the period of 2001-2010 and 2011-2017 showed that the market structure of 7 countries Argentina, China, Germany, Japan, Spain, Sweden and the United Arab Emirates have become more monopolistic and 9 other countries have got more competitive structures. According to the results of the gravity model, the market structure of the importing countries has had a significant effect on Iranian saffron exports and the more competitive target markets have caused reduction of Iranian saffron exports. Hence, as saffron target markets become more competitive, it is suggested that exporters pay more attention to improving their competitive components in the markets, especially packaging. In accordance with world standards, packaging should be based on the quality of the product and provide complete information for customers.