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Supermarket power, own-labels, and manufacturer counterstrategies: international relations of cooperation and competition in the fruit canning industry

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  • Libby Hattersley
  • Bronwyn Isaacs
  • David Burch

Abstract

Growing supermarket dominance and the expansion of own-label market share in Australia has put considerable pressure on agri-food manufacturers, and the recent movement of a number of manufacturing operations off-shore has attracted widespread attention. This paper examines the pursuit of an international manufacturing base by SPC Ardmona, one of Australia’s major fruit and vegetable processors, with a focus on strategic alliances formed with Siam Foods in Thailand and Rhodes Food Group in South Africa/Swaziland. Strategic horizontal alliances have become increasingly important for manufacturers seeking to counter retailer dominance, yet have received little attention in the agri-food literature. The two alliances examined in this paper illustrate the profound importance of prevailing societal and institutional environments in which production networks ‘touch-down’, and their influence on firm-level dynamics of trust, motivation, corporate values, and strategic objectives. Horizontal alliances can offer a promising alternative to cut-throat competition and a ‘race- to-the-bottom’ between agri-food manufacturers. However, with own-label sourcing strategies deepening competition between geographically-disparate manufacturers, identifying compatible alliance partners is likely to become an increasingly greater challenge. Copyright Springer Science+Business Media Dordrecht 2013

Suggested Citation

  • Libby Hattersley & Bronwyn Isaacs & David Burch, 2013. "Supermarket power, own-labels, and manufacturer counterstrategies: international relations of cooperation and competition in the fruit canning industry," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 30(2), pages 225-233, June.
    • Handle: RePEc:spr:agrhuv:v:30:y:2013:i:2:p:225-233
    DOI: 10.1007/s10460-012-9407-5
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    References listed on IDEAS

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    1. Mulrony, Brandi R. & Chaddad, Fabio Ribas, 2005. "Strategic Alliances in the U.S. Beef Supply Chain," Journal of Food Distribution Research, Food Distribution Research Society, vol. 36(3), pages 1-15, November.
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    Cited by:

    1. Hilli, Alastair & Griffith, Garry, 2022. "Market Power in the Domestic Fresh Meat Market," Australasian Agribusiness Review, University of Melbourne, Department of Agriculture and Food Systems, vol. 30(8), November.
    2. Gumataw Kifle Abebe, 2020. "Effects of institutional pressures on the governance of food safety in emerging food supply chains: a case of Lebanese food processors," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 37(4), pages 1125-1138, December.
    3. Douglas H. Constance, 2023. "The doctors of agrifood studies," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 40(1), pages 31-43, March.
    4. Jérémie Forney, 2016. "Blind spots in agri-environmental governance: some reflections and suggestions from Switzerland," Review of Agricultural, Food and Environmental Studies, Springer, vol. 97(1), pages 1-13, June.
    5. Mikkola, Minna, 2015. "Business Concept as a Relational Message: Supermarket vs Independent Grocery as Competitors for Sustainability," International Journal on Food System Dynamics, International Center for Management, Communication, and Research, vol. 6(4), pages 1-11, November.

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