In Europe, cooperatives have a long tradition and are widespread in the agricultural sector. Cooperatives in the wine sector of some EU countries even surpass a market share of more than 50%. In Germany, the first wine cooperative was established in 1868 in the Ahr region. Despite the decline in the number of cooperatives, of members and of the vineyard area cultivated by cooperatives, wine cooperatives are still accountable for roughly a quarter of the German vineyard area. Due to developments in the field of sustainability and digitalisation, cooperatives are facing increasing pressure. Based on the definition of cooperatives by the International Co-operative Alliance, one can conclude that cooperatives are a sustainable form of enterprise. A previous study from 2019 showed that sustainability and digitalisation were not mentioned by cooperative management as important topics in the competitive analysis. Also, sustainable management practices have not been analysed explicitly for wine cooperatives so far. We therefore consider sustainability and digitalisation in the context of the strategic management of wine cooperatives. Our article does not aim to show further development in the areas of sustainability and digitalisation but rather to unveil existing managerial practices in order to provide a basis for management decisions. As only limited knowledge exists, a qualitative approach was chosen. Interviews were conducted with the management of wine cooperatives (n = 13) and representatives of the regional and national cooperative associations, which in turn represent the wine cooperatives as a whole (n = 4). A data content analysis was performed. The results describe state of the art of sustainable management practices and digitalisation in wine cooperatives. Even if the understanding of sustainability and digitalisation is quite similar among the respondents, the operationalisation in the cooperatives differs strongly. However, it is clear that innovation, adaptability and sustainability are strongly interlinked. Options for future research and the limitations of the study are provided as well.
In February 2022, the European Parliament agreed on a far-reaching package of measures to regulate alcohol consumption in its vote on “Strengthening Europe in the fight against cancer”. This article therefore elaborates on the most important positions and directions of current European alcohol policy and discusses possible effects on the German wine industry based on existing literature. It can be shown that the attitudes towards alcohol consumption sometimes differ considerably within the European Union, but that there is increasing harmonization of consumption-regulating measures in the course of European integration. However, alcohol policies in the EU are limited by an unclear scientific assessment of “moderate” consumption. This is supplemented by moderate social awareness and the scientific discourse on the effectiveness of alcohol policy measures, as well as a lack of government initiative and legal barriers. Ultimately, the German wine industry finds itself confronted with new scientific findings, associated political demands and creeping changes in social attitudes towards alcoholic beverages.
Similar to the number of agricultural cooperatives in the European Union, the number of German wine cooperatives is decreasing. The main purpose of the wine cooperatives is to support the member businesses with the highest possible payouts for their grapes. Wine cooperatives can fulfil this purpose by implementing a differentiation strategy. On the one hand, brands can be used for differentiation. On the other hand, cooperatives can use particular values in the communication with customers that correspond to the target group’s values. Based on the definition of the International Co-operative Alliance, cooperatives are a sustainable form of enterprise. Therefore, the question arises whether it is possible to use sustainability as a value that corresponds to cooperatives as a form of enterprise as well as to a strong societal value that gains importance. Which role does social capital play in the context of social sustainability? The aim of this paper is to shed light on the understanding of brands, to show which cooperative-specific characteristics might pose a challenge to cooperatives in terms of brand management and to examine the understanding of the sustainability construct as well as sustainable management practices applied by wine cooperatives to date. Two exploratory, qualitative studies have been conducted.
The current chapter demonstrates an application of the theoretical framework of vertical coordination, more specifically the application of contracting in productive partnerships, to integrate smallholders into the value chain of a specialised crop. The aim of the chapter is to derive implications for industry participants on how to integrate smallholders with vertical coordination. Therefore, we take a closer look on vertical coordination and contracting in productive partnerships. We have taken the value chain of brandy production in Armenia and used the Yerevan Brandy Company (YBC) to perform our case study, with which we can analyse vertical coordination mechanisms used by the company. Further, we want to identify factors that drive processors and smallholders to enter into contracts. Qualitative interviews were conducted with the YBC, their grape suppliers, as well as experts from related fields. We analysed the data with a qualitative content approach. Results show that the YBC uses different measures of vertical coordination, i.e., contracts and farm assistance in the form of consultancy and input supply. The company tends to use production contracts rather than pure marketing contracts, as it is actively engaged in the production process. The use of contract farming is beneficial for both the processing company and the smallholders.
24 November 2023 in International Food and Agribusiness Management Review
It is essential for firms in the agri-food business to ensure specific product attributes in the long run and to avoid reputational damage. Competitive advantages cannot be achieved with such product attributes; however, they must be ensured to remain competitive in the long run. Searching for literature on competitive parity resulted to be very difficult and literature on competitive parity seems to merely exist in strategic management literature. The question arises as to whether competitive parity is also a strategic dimension to which companies must pay attention in strategic management, especially with regard to the allocation of scarce resources. Since the majority of firms in the agri-food business work together in supply chain networks, another research question arises: is competitive parity also relevant at the network-level? To answer these questions a systematic literature review, which is based on deliberately chosen leading journals in the field of strategic management and chain management, is conducted. Results on the firm-level and the network-level show that there is hardly any literature on competitive parity available. This paper aims to contribute to a better theoretical understanding of competitive parity in strategic management. It develops a theoretical frame of chain management which combines the aspects of competitive parity with those of chain management in the agri-food business. From this, managerial implications for focal firms in the agri-food industry as well as implications for future research in this field should be derived.
29 October 2021 in Journal of Agribusiness in Developing and Emerging Economies
Purpose: In 1998, the Chinese Communist Party introduced the strategy for modernizing agriculture with large-scale production and launching large commercial enterprises known as dragon head enterprises (DHEs) to process and market agricultural products. Although scholars have raised awareness of the development of DHEs in China, there has been little investigation on DHEs in the Chinese wine business. Based on the existing theoretical background on the concept of DHEs, this study aims to identify the structure and operating system of a DHE in the Chinese wine business. Changyu is chosen as an example because it is the oldest and largest wine company in China, operating in various grape-growing regions.Design/methodology/approach: Due to the research's explorative character, the qualitative approach and case study focus were considered adequate. In-depth interviews have been conducted with the employees of the company. The authors analysed data with a qualitative content approach of Gläser and Laudel (2010).Findings: Results show that the grape procurement of Changyu is organized in an integrated system, which consists of the DHE (Changyu), the Changyu-led cooperative, and the grape producers who have a contract with the cooperative. The company takes different measures in terms of intra-organizational coordination to secure the required quantities and qualities of its grape supply base.Research limitations/implications: In this research, the authors could only access three interview partners of Changyu's grape procurement department, and it was not possible to conduct interviews with the management of Changyu. Another limitation is that it is difficult to collect adequate data in the Chinese wine industry.Originality/value: There has been little investigation on DHEs in the Chinese wine business. This research contributes to the existing literature as it takes a closer look at the structure and operating system of a DHE in the Chinese wine business. The case study and chosen example (Changyu) allow a better understanding of DHEs and provide first insights into their operating principle.