Relationships, networks and interactions in food and agriculture business-to-business marketing and purchasing

Citation

Lindgreen, A., Hingley, M. and Trienekens, J. (2008), "Relationships, networks and interactions in food and agriculture business-to-business marketing and purchasing", British Food Journal, Vol. 110 No. 4/5. https://doi.org/10.1108/bfj.2008.070110daa.001

Relationships, networks and interactions in food and agriculture business-to-business marketing and purchasing

Article Type: Guest editorial From: British Food Journal, Volume 110, Issue 4/5.

About the Guest Editors

Dr Adam Lindgreen is Professor of Strategic Marketing at Hull University Business School. Adam Lindgreen has published in several journals including Industrial Marketing Management, Journal of Business Ethics, Journal of Business and Industrial Marketing, Business Horizons, Journal of Marketing Management, and Psychology & Marketing, among others. His research interests include business and industrial marketing, consumer behavior, experiential marketing, relationship and value management, and corporate social responsibility. He serves on the board of many journals including Journal of Business Ethics.

Dr Martin Hingley is a Principal Lecturer in Marketing, based at Harper Adams University College in Shropshire, the leading university in the UK specializing in agri-business. His primary research interests are in marketing and in the applied areas of food industry marketing and supply chain relationship management. He has presented and published widely in these areas, and serves on the editorial boards of several academic journals.

Dr Jacques H. Trienekens is Associate Professor at Management Studies Group at Wageningen University. He is Editor and Associate Editor of Journal on Chain and Network Science and International Food and Agribusiness Management Review respectively, and has published in a variety of peer reviewed international journals such as International Journal for Production Economics, Production Planning and Control, Computers in Industry, Food and Agribusiness Management Review, and Journal on Chain and Network Science. He is also Director of Wageningen Expertise Center for Chain and Network Studies, an expertise center that bundles research and education on food chains and networks of Wageningen University and Research Centre.The study of relationships, networks, and interactions in food and agriculture business-to-business marketing and purchasing is an important endeavor. From having been concerned with getting the “marketing mix” (i.e. the 4Ps: product, price, place, and promotion) right, the food and agriculture setting has experienced significant changes over the past decades. For example, the decline of production industries has seen a rise in service industries. Increased emphasis is now placed on the development of services and the way in which these can be incorporated into goods and aligned with marketing and quality as a coherent value-creation chain.

Traditionally, marketing focused on attracting new customers in a broad market, or a specific segment, against a background of unfulfilled demand, thereby satisfying growing demand by using marketing techniques, portfolio analysis, and production means. In the context of maturity, there are few or no new customers, mergers and acquisitions reduce the number of current customers; and the commercial significance of remaining customers is increased. The traditional approach to marketing is, therefore, likely to be less effective since its focus is on attracting new customers. An alternative approach to marketing emphasizes the value of maintaining customers to grow profits and sales.

In food and agriculture business-to-business marketing and purchasing, the maintenance and enhancement of relationships, networks, and interactions (“relationship marketing”) with different stakeholders is as important as the attraction of relationships, networks, and interactions (“transaction marketing”). Yet, the story of how relationship marketing fits into the greater marketing landscape has been somewhat inconsistent. Also, a lack of empirical work underpins the conceptual development in food and agriculture of relationship marketing, which often is characterized more by rhetoric than by publication effort on empirical findings. This special double issue of British Food Journal seeks to address some of these research lacunae in the literature.

Following our own guest editorial, the first paper “Relationship connectors in NZ fresh produce supply chains” by Michael D. Clements, Ricardo M. Lazo, and Sandra K. Martin, examines the theory of relationship connectors to contribute to our knowledge of relationship marketing in the food industry. The paper seeks to understand the multitude of linkages that exist between customer requirements, the characteristics of fresh produce, the functions performed by supply chains, and how these impact on relationships in chains. In the context of fresh produce supply chains in New Zealand, the authors find that relationships are characterised by strong information exchange, relatively strong cooperative norms, strong operational linkages, and specific buyer-seller adaptations. Such relationships facilitate the supply chain functions of procurement, quality, logistics, and information, thereby ensuring that the challenges facing these supply chain functions, the market requirements of fresh produce, and product characteristics could be managed.

The second paper “The impact of an organization’s collaborative capacity on its ability to engage its supply chain partners” by A.J. Dunne reports on a longitudinal study over a two-year period. The study involved multiple semi-structured interviews with respondents who were participants in the engagement process. The author seeks to evaluate the process adopted by a leading Australian food processor to engage its major supply chain partners more collaboratively as part of the company’s strategy to strengthen its competitive position. The findings of the study identify the importance of the focal company having developed its own collaborative capabilities before engaging its supply chain partners. As well, building closer relationships is difficult and resource intensive and the nature of the ensuring relationship will vary.

The third paper “Collaboration and trust in two organic food chains” by Marja-Riitta Kottila and Päivi Rönni contribute to our knowledge about the nature of relationships and collaboration (communication and trust) along an organic food chain in Finland, from farmers to multiple retailers. The chosen method is a case study consisting of two cases. The authors find collaboration in a few dyadic relationships, but not at the chain level. As well, the competence demonstrated as an exchange partner appears to be essential for a trustful relationship. Neither the power imbalance, nor the different value systems make trustful and collaborative relationships impossible. These findings suggest that small organic suppliers should develop relationships with mainstream retailers by improving their overall competence as exchange partners. They need to consider the influence of their action not only on the adjacent actors, but also on the relationships within the whole organic food chain.

The fourth paper “Building collaborative agri-food supply chains: the challenge of relationship development in the Scottish red meat chain” by Philip Leat and Cesar Revoredo-Giha contributes in the field of understanding the attitudes and circumstances of the various supply chain participants. As such, the authors highlight empirical issues that may hamper the development of collaborative supply chains. Specifically, the authors examine the challenges that the future strategy for Scottish agriculture may face with respect to the wider establishment of collaborative supply chains and the strengthening of links between beef and sheep farmers and other parts of the meat supply chain. Drawing upon a postal survey of beef and sheep producers throughout Scotland, the authors demonstrate that there are low levels of customer awareness amongst farmers in the red meat chain, and low levels of trust of other chain participants, particularly in relation to price. Moreover, many producers express considerable reluctance to get involved in chain coordination and integration, believing it would impose on their independence and business control.

The fifth paper “The value of guanxi for small vegetable farmers in China” by Hualiang Lu, Jacques H. Trienekens, Onno Omta, and Shuyi Feng adds to our knowledge through quantitative evaluation of the effects of the Chinese cultural embedded concept of guanxi in the Chinese agri-food sector. Following a guanxi value buyer-seller relationships quality marketing behavior scheme, the authors explore how traditional guanxi supports small vegetable farmers in modern markets in China. Drawing on a sample of 167 vegetable farmers, the study suggests that the value of guanxi networks is an antecedent to buyer-seller relationships quality and marketing behavior in China. Also, the quality of buyer-seller relationships (in terms of interpersonal trust and satisfaction) is improved through guanxi networks. This, in turn, influences small vegetable farmers’ transaction relationships, and their participation in modern markets and contract choice. Also, guanxi networks not only support farmers getting access to modern market outlets, but also encourage informal transactions in the vegetable business.

The sixth paper “Product development alliances: factors influencing formation and success” by Johanne Rønnow Olsen, Hanne Harmsen, and Alan Friis contributes to the literature on developing a framework for factors influencing the formation and success of product development alliances in the food industry context. Drawing upon a case study of a product development alliance with four partners and an interview survey with key informants in the Danish food industry, the authors find that the nature of differences between their framework for product development alliances appear to rest in the chosen specific context. External conditions do not force companies to enter into product development alliances, meaning that, when compared to other industries, motivations have to be stronger or risks smaller for them to form such inter organisational relationships. But, once formed, success factors are generally universal across industries and types of alliances. Overall, the authors’ framework provides a tool for planning and refining an innovation strategy, as well as actions regarding product development alliances.

The seventh paper “Cottesbrook’s New Zealand Sauvignon Blanc wine to Tesco” by Rupert Tipples describes the first successful export of relatively economically insignificant goods (in this case, wine from New Zealand to Britain for sale in bag-in-box containers) in an oversupplied market, and how this export is far more efficient in “food miles”. Building on semi-structured interviews with key informants, previous experience, observations, documentary and web resources, the author identifies the problems facing a small wine producer, and how access to Tesco is achieved and maintained. Specifically, previous contact with Tesco personnel is important to gaining access. The role of the channel coordinator is to provide Tesco, reliably and over time, with desired goods at desired times. Supply chain relationships should be supported by active participation of the supplier’s principals, both personally and in developing solutions to Tesco’s problems.

The eighth paper “Trust and governance of global value chains: the case of a Brazilian beef processor” by Luciana Marques Vieira and W. Bruce Traill examines developing countries’ agri-food chains; these generally still rely on spot market transactions and old business practices. For their study, the authors use a Brazilian beef processor that supplies two different distribution channels (supplying, respectively, the EU market and the Brazilian market). The study’s findings identify that executive chain governance exercised by retail stimulates technical upgrading and transferring of best practices to local suppliers. Consequently, this kind of relationship results in more trust within the global value chain.

The ninth paper “Dynamics of the retail-driven higher end spot market in fresh food” by Koen Mondelaers and Guido Van Huylenbroeck contributes to our understanding of how multiple certification schemes merge into a single retail driven scheme. Specifically, the authors investigate by means of a Belgian case study, the transition of multiple certification schemes currently employed in the food sector towards a single retail driven higher end spot market. Drawing on focus group sessions, a survey, in depth interviews, and secondary data, the authors illustrate the current institutional setting of certification, the drive towards a premium spot market, and the consequences for the participants in the schemes. The authors’ findings identify that a shift towards a premium spot market is apparent. As well, the dynamics of certification schemes are characterized by mergers followed by diversification. Overall, the retail sector is the primary beneficiary of the shift.

The tenth paper “The usefulness of social capital in assessing the welfare effects of private and third-party certification food safety policy standards: trust and networks” by Valeria Sodano, Martin Hingley, and Adam Lindgreen introduces to some new (with respect to the marketing literature related to the food system) concepts and theories of economic sociology. The authors’ aim is to assess the welfare effects of the newest trends in food safety policies characterized by the shift from public to private intervention. Analyzing food safety policies through concepts of new economic sociology, with a critical review of the literature on social capital, the authors identify that as food safety and quality attributes responsible for the exchange complexity are simply codified and enforced through standards and third-party certification, the global value chain governance shifts from a relational type to a power-based type, with possible negative welfare effects.

The 11th paper “Horizontal alliances amongst small retailers in Brazil” by Flávia A. Ghisi, José A. G. da Silveira, Tore Kristensen, Martin Hingley, and Adam Lindgreen adds to the relatively few theoretical and practical studies analysing the relationship between various themes concerned with alliances and small retailers. These themes are: the reasons for forming a strategic alliance in retail; minimum criteria for the alliance activity amongst retailers; steps that managers must take to create a competitive retail alliance; critical core competencies to be developed on the retail alliance; types of retail alliances; and, finally, forms of strategic retail alliances and stages/steps to develop a retail alliance over time. Drawing upon both quantitative and qualitative research was carried out with horizontal retail alliances (independents, as well as non-integrated chain retailers) in Brazil; the study discusses the outlined themes.

Specific issues in relation to relationships, networks, and interactions in food and agriculture business-to-business marketing and purchasing not dealt with in this issue include: What are current concerns among food and agriculture managers vis-à-vis transaction marketing and relationship marketing? How do companies implement successfully their relationships, networks, and interactions with important stakeholders? Are certain management structures more relevant in relationship marketing than in transaction marketing? How is it possible to build trust in power-imbalanced buyer-seller relationships? What is the role of trust and governance in inter-company relationships? What do we know about marketing and governance? How do market relationships evolve over time? Do the form and the intensity of relationships depend on contextual factors such as the number of competitors and the market’s ability to absorb extra production capacity? How does buyer-seller relationship building take place under different institutional environments? Under which conditions are transaction marketing and relationship marketing appropriate? How can companies assess how they are doing in terms of managing their market relationships, networks, and interactions? Is it possible to suggest a set of best practices in relationship marketing? Is there a set of practices common for all companies, and a set of additional practices that depends on the particular industry sector or company? How does the implementation of relationship marketing affect suppliers (upstream) and buyers (downstream)? What are the current challenges facing relational-oriented companies? Finally, are international relationships, networks, and interactions any different from national ones?

We would like to take the opportunity of thanking all those who have contributed towards this special issue of British Food Journal. First, we thank the reviewers who have taken time to provide timely feedback to the authors, thereby helping the authors to improve their manuscripts. The reviewing was a double-blind reviewing process. We thank the following reviewers: Nicholas Alexander, Sean Beer, Jos Bijman, Michael Bourlakis, Paul Custance, Rachel Duffy, Andrew Fearne, John Fernie, Melanie Fritz, David Grant, Geoffrey Hagelaar, Gertjan Hofstede, Paul Ingenbleek, Angus Laing, Sheena Leek, Kevin Nield, Onno Omta, Sjoukje Osinga, Roger Palmer, Veronica Freitas de Paula, Brian Revell, Mike Rimmington, Terry Robinson, Aad van Tilburg, Keith Walley, Max Winchester, and Len Tiu Wright.

Second, we would like to extend special thanks to the editor Chris Griffith for giving us the opportunity of guest editing a special issue of British Food Journal. Last, but not least, we warmly thank all of the authors who submitted their manuscripts for consideration of inclusion in British Food Journal. We appreciate and are grateful for the authors’ desire of wanting to share their knowledge and experience with the journal’s readers and for having their views put forward for possible challenge by their peers. We are confident that the articles in this special issue contribute to our understanding of relationships, networks, and interactions in food and agriculture business-to-business marketing and purchasing.

Adam Lindgreen, Martin Hingley, Jacques TrienekensGuest Editors