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Case study analysis on supplier commitment to added value agri-food supply chains in New Zealand

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  • Nic Lees
  • Peter Nuthall

Abstract

This research identifies what attracts suppliers to be committed to long-term relationships in New Zealand agri-food supply chains where suppliers are required to consistently deliver to high product specifications. It also looks at what factors determine supplier’s ongoing commitment and how to build strong enduring supply chain relationships. Semi structured interviews were undertaken with suppliers from New Zealand agri-food exporting companies. The main factors that attracted suppliers to these supply chains were; increased price certainty, premium prices and relationship quality. Many suppliers wanted to break away from the agricultural commodity cycle, which they saw as disconnected from customer demand, and characterised by price volatility. They saw themselves as better than average producers with the ability to produce high quality products. They valued the relationship with the companies they supplied as this gave them access to premium markets where they felt they would be rewarded for their effort. There was a high level of trust in these relationships and this was built on openness and transparency in communications and confidence in the character of the company personnel. The success of differentiated agri-food supply chains requires capable and committed suppliers. Companies that are developing a differentiated strategy need to identify suppliers who have the ability to produce high quality products and want to be involved in a customer focused supply chain enables them to access to premium markets. Copyright Lees and Nuthall; licensee Springer. 2015

Suggested Citation

  • Nic Lees & Peter Nuthall, 2015. "Case study analysis on supplier commitment to added value agri-food supply chains in New Zealand," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 3(1), pages 1-16, December.
    • Handle: RePEc:spr:agfoec:v:3:y:2015:i:1:p:1-16:10.1186/s40100-014-0024-z
    DOI: 10.1186/s40100-014-0024-z
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    References listed on IDEAS

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    Cited by:

    1. Hobbs, J., 2018. "Transaction Costs, Institutions and the Organization of Supply Chains: Three Good Questions," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277411, International Association of Agricultural Economists.
    2. Graham, Penny & Baker, Derek & Griffith, Garry, 2021. "Relationship Quality in a Lamb Production Network," Australasian Agribusiness Review, University of Melbourne, Department of Agriculture and Food Systems, vol. 29(5), December.
    3. Shuo Gao & Ming Kim Lim & Renlu Qiao & Chensi Shen & Chentao Li & Li Xia, 2022. "Identifying critical failure factors of green supply chain management in China’s SMEs with a hierarchical cause–effect model," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(4), pages 5641-5666, April.
    4. Lees, Nic & Nuthall, Peter & Wilson, Mark M.J., 2020. "Relationship quality and supplier performance in food supply chains," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 23(3), August.
    5. Gyula Kasza & Judit Oláh & József Popp & Zoltán Lakner & László Fekete & Enikő Pósa & Widya Satya Nugraha & Dávid Szakos, 2024. "Food miles on the shelves: the share of local food products in the Hungarian retail sector," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 12(1), pages 1-24, December.

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    More about this item

    Keywords

    Q13; Supplier relationships; Commitment; Trust; New Zealand; Competitive advantage; Resource based view; Social capital;
    All these keywords.

    JEL classification:

    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness

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