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Private labels and public quality standards: How can consumer trust be restored after the mad cow crisis?

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  • Éric Giraud-Héraud
  • Lamia Rouached
  • Louis-Georges Soler

Abstract

In those sectors faced with questions of food safety (meat, fruit, vegetables), new private labels have been set up in Europe in order to restore consumer trust. In this paper, we perform a theoretical analysis of these private labels. We propose an original model of vertical relationships between producers and retailers which takes into account two supply sources through (i) a competitive spot market on which the retailers buy a minimum quality standard product and (ii) supply contracts aimed at marketing higher quality private labels. We study how producers and retailers could cooperate in setting up these new labels. From a public point of view, we show the complementarity of a moderate increase in public quality standards and the creation of these new private labels. Copyright Springer Science + Business Media, LLC 2006

Suggested Citation

  • Éric Giraud-Héraud & Lamia Rouached & Louis-Georges Soler, 2006. "Private labels and public quality standards: How can consumer trust be restored after the mad cow crisis?," Quantitative Marketing and Economics (QME), Springer, vol. 4(1), pages 31-55, March.
    • Handle: RePEc:kap:qmktec:v:4:y:2006:i:1:p:31-55
    DOI: 10.1007/s11129-006-2777-5
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    Cited by:

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    2. Geoffroy Enjolras & Magali Aubert, 2015. "Do short food supply chains go hand in hand with environment-friendly practices?," Post-Print hal-02047862, HAL.
    3. Vanessa von Schlippenbach & Isabel Teichmann, 2012. "The Strategic Use of Private Quality Standards in Food Supply Chains," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 94(5), pages 1189-1201.
    4. Magali Aubert & Geoffroy Enjolras, 2016. "Do short food supply chains go hand in hand with environment-friendly practices? An analysis of French farms," International Journal of Agricultural Resources, Governance and Ecology, Inderscience Enterprises Ltd, vol. 12(2), pages 189-213.
    5. Caprice, Stéphane & von Schlippenbach, Vanessa & Wey, Christian, 2014. "Supplier fixed costs and retail market monopolization," DICE Discussion Papers 164, Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    6. Eric Giraud-Héraud & Cristina Grazia & Abdelhakim Hammoudi, 2012. "Explaining the Emergence of Private Standards in Food Supply Chains," Working Papers hal-00749345, HAL.
    7. Eric Giraud‐Héraud & Abdelhakim Hammoudi & Ruben Hoffmann & Louis‐Georges Soler, 2012. "Joint Private Safety Standards and Vertical Relationships in Food Retailing," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 21(1), pages 179-212, March.
    8. Bozic, Branko, 2017. "Consumer trust repair: A critical literature review," European Management Journal, Elsevier, vol. 35(4), pages 538-547.
    9. Magali Aubert & Geoffroy Enjolras & Zouhair Bouhsina, 2016. "How does the choice of a marketing channel influence the adoption of organic farming ?," Post-Print hal-01419767, HAL.
    10. Isaac Maina Kariuki & Jens‐Peter Loy, 2016. "Contractual Farming Arrangements, Quality Control, Incentives, and Distribution Failure in Kenya's Smallholder Horticulture: A Multivariate Probit Analysis," Agribusiness, John Wiley & Sons, Ltd., vol. 32(4), pages 547-562, November.
    11. Vigani, Mauro & Olper, Alessandro, 2014. "GM-free private standards, public regulation of GM products and mass media," Environment and Development Economics, Cambridge University Press, vol. 19(6), pages 743-768, December.
    12. Eric Giraud-Héraud & Hakim Hammoudi & Louis-Georges Soler, 2006. "Food Safety, Liability and Collective Norms," Working Papers hal-00243034, HAL.
    13. Bozic, Branko & Kuppelwieser, Volker G., 2019. "Customer trust recovery: An alternative explanation," Journal of Retailing and Consumer Services, Elsevier, vol. 49(C), pages 208-218.
    14. Kariuki, Isaac Maina & Loy, Jens-Peter & Herzfeld, Thomas, 2012. "Farmgate Private Standards and Price Premium: Evidence From the GlobalGAP Scheme in Kenya's French Beans Marketing," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 28(1), pages 42-53.

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