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Competitive Analysis Of U.S. Food Processing Plants

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  • Jayanthi, Shekhar
  • Kocha, Bart
  • Sinha, Kingshuk K.

Abstract

This paper presents a model-based approach for competitive analysis of manufacturing plants in the U. S. food processing industry. As part of this approach, plant competitiveness is measured using Operational Competitiveness Ratings Analysis (OCRA) -- a new non-parametric method of computing relative inefficiency. Drivers of competitiveness are identified in terms of policies related to plant structure and infrastructure. Policies related to plant structure are those decisions that are related with "bricks and mortar" and have long term implications, such as decisions related to plant size and capacity. Policies related to plant infrastructure are decisions related to how the " bricks and mortar" are used. These policies are typically under the direct control of the operations managers and have a short-term orientation, such as decisions related to equipment, quality, inventory, workforce and confusion-engendering activities (e.g. new product introductions and product variety). The empirical analysis is based on detailed cross-sectional data on 20 processed food manufacturing plants. With respect to plant structure, the results suggest that small sized food processing plants are competitive, and both capacity underutilization and overutilization are detrimental to plant competitiveness. Among the significant results with respect to plant infrastructure, equipment maintenance, quality management programs, packaging supplies inventory, workforce training and product variety are positively associated with plant competitiveness. The results also suggest that introduction of new products disrupts plant operations, at least in the short run, and is negatively associated with plant competitiveness.

Suggested Citation

  • Jayanthi, Shekhar & Kocha, Bart & Sinha, Kingshuk K., 1996. "Competitive Analysis Of U.S. Food Processing Plants," Working Papers 14333, University of Minnesota, The Food Industry Center.
  • Handle: RePEc:ags:umrfwp:14333
    DOI: 10.22004/ag.econ.14333
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    References listed on IDEAS

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    Cited by:

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    2. Ismaili, Mohamed & Raggi, Meri & Viaggi, Davide, 2007. "People, trade and training: the needs of Morocco agricultural enterprises facing EU markets," 105th Seminar, March 8-10, 2007, Bologna, Italy 7882, European Association of Agricultural Economists.
    3. Ruzhdi Jashari, 2017. "Protection of Personal Data Requirement of Modern Times for the Functioning of the Security, Individual Freedoms and the Rule of Law," European Journal of Multidisciplinary Studies Articles, Revistia Research and Publishing, vol. 2, May Augus.
    4. Tóth, József, 2005. "Működési versenyképesség és hajtóerői a hazai húsiparban [Operative competitiveness and the forces driving it in the Hungarian meat industry]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(7), pages 743-762.
    5. Muhammad AFZAL & Maryam AYAZ, 2013. "Efficiency of Food Sector of Pakistan-A Dea Analysis," Asian Journal of Empirical Research, Asian Economic and Social Society, vol. 3(10), pages 1310-1330, October.

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