Why monitor markets?

Markets play a key role in the response to and recovery from a crisis. Understanding how local, national and international markets function and interact is therefore a critical step in designing effective emergency or development programs and making critical adaptations to them. Monitoring market conditions over the life of a program can help managers identify whether changes in the supply of, or demand for, key commodities risks further escalating market anomalies, and can help identify strategies to mitigate the impact of such changes. Specifically, monitoring markets can help practitioners to:

• Assess how well the market is functioning and identify existing and/or potential bottlenecks.
• Track whether existing responses positively or negatively distort local markets (e.g., surpassing the available supply, increasing prices for non‑participants, creating or strengthening monopolies, or causing inflation).
• Assess the continued appropriateness of the chosen delivery modality and design options/components.
• Determine whether the value and level of assistance remain adequate.
• Inform corrective actions regarding the intervention strategy.
• Monitor market‑related program outcomes.

Programs need to be agile enough to collect and act upon market information so that participant needs are appropriately met and no harm is done to local markets.

MARKit purpose and scope

The aim of the Market Monitoring, Analysis and Response Kit (MARKit) is to improve program quality by enabling managers to adapt their programs to changes in the local market environment. MARKit provides a framework for market monitoring, analysis and response decision‑making, using prices as the main indicator. Prices are highly sensitive to changes in market function, supply and demand and can therefore signal changes that need to be investigated further.

By focusing on prices, MARKit addresses the first five market monitoring objectives listed above. However, monitoring prices alone may not be sufficient for monitoring broader market‑related program outcomes, such as assessing the multiplier effect of your program or profit margins along the supply chain. This last objective lies outside of MARKit’s scope.

Through the introduction of a standardized methodology for price collection, management and analysis, MARKit is designed to support evidence‑based decision‑making. In many programs, staff collect price information but may lack the time and/or skills to analyze it. Streamlining the market monitoring process will help teams be more efficient and effective with their time, enabling them to focus on analysis to inform decision‑making.

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