Supermarket power, own-labels, and manufacturer counterstrategies: international relations of cooperation and competition in the fruit canning industry

Libby Hattersley (), Bronwyn Isaacs () and David Burch ()

Agriculture and Human Values, 2013, vol. 30, issue 2, 225-233

Abstract: Growing supermarket dominance and the expansion of own-label market share in Australia has put considerable pressure on agri-food manufacturers, and the recent movement of a number of manufacturing operations off-shore has attracted widespread attention. This paper examines the pursuit of an international manufacturing base by SPC Ardmona, one of Australia’s major fruit and vegetable processors, with a focus on strategic alliances formed with Siam Foods in Thailand and Rhodes Food Group in South Africa/Swaziland. Strategic horizontal alliances have become increasingly important for manufacturers seeking to counter retailer dominance, yet have received little attention in the agri-food literature. The two alliances examined in this paper illustrate the profound importance of prevailing societal and institutional environments in which production networks ‘touch-down’, and their influence on firm-level dynamics of trust, motivation, corporate values, and strategic objectives. Horizontal alliances can offer a promising alternative to cut-throat competition and a ‘race- to-the-bottom’ between agri-food manufacturers. However, with own-label sourcing strategies deepening competition between geographically-disparate manufacturers, identifying compatible alliance partners is likely to become an increasingly greater challenge. Copyright Springer Science+Business Media Dordrecht 2013

Keywords: Agri-food; Supermarket; Own-label; Food manufacturing; Strategic alliance; Canned fruit; Competition (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (5)

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DOI: 10.1007/s10460-012-9407-5

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