Food waste due to coercive power in agri-food chains: Evidence from Sweden

Food produced but not consumed is one the greatest threats to sustainable food systems. While there is evidence in the literature to suggest that food is wasted at all stages of the agri-food chain, the role of take back agreements (TBAs) has not been emphasized. When market conditions are such that TBAs become a tool for the retailers to express coercive power over the supplier, there is an incentive to over-order and hence waste. In this study, a case-based approach was used to explore the existence and implications of coercive power at the retailer-supplier interface due to presence of TBAs in the context of Swedish bread suppliers. Specifically, company data for a medium-sized premium bread supplier in Sweden was analyzed. This supplier faced 30% returns of its total volume produced in the period 2011-15 and had to bear the entire cost of bread rejections, collection and disposal. It was paid only for the bread sold to end customers, and not for the contracted quantity. The findings indicate that TBAs are drivers of food waste at the supplier-retailer interface as it reduces the incentives for retailers to prevent waste. Our study confirms that it is a problem requiring serious policy attention. Acknowledgement : The study was funded by the European Union through the research programme ERA-Net SUSFOOD and the project COnsumers in a SUStainable food supply chain (COSUS). Primary data through interviews were provided by representatives of all major retailers and bread producers in Sweden, while detailed supply data were provided by the bread supplier Salt Kvarn. The company has allowed access to its data for the purposes of research without any anonymity conditions. The authors would like to thank the staff at all the companies involved for their help and cooperation.