Coordinating food quality: How do quality standards influence contract arrangements? A study on Uruguayan food supply chains

Abstract

Purpose The aim of this paper is to study the influence of quality standards on contract arrangements in food supply chains. Design/methodology/approach A qualitative double case study was conducted on the dairy and citrus sectors in Uruguay. A transaction cost theoretical framework was used. All current public and private quality standards applied by processors were studied in relation to contract arrangements between processors and upstream producers as well as downstream buyers for each sector. Findings Quality standards complement contract arrangements for upstream transactions, leading to hierarchy-type contract arrangements. Quality standards substitute contract arrangements for downstream transactions, leading to market- or hybrid-type contract arrangements. Research limitations/implications Longitudinal studies that measure changes in contract arrangements over time are recommended. Practical implications Supply chain actors can reduce transaction costs by aligning quality standards with appropriate contract arrangements – further supported by public instruments. Originality/value Quality standards have differential influence on underlying transaction characteristics, and therefore on contract arrangements, depending on the location of the transaction in the supply chain.

A systematic analysis of quality management in agri-food supply chains: a hierarchy of capabilities perspective

“…Internal inter-related process coordination help companies improve their operational effectiveness and efficiency along SC (Sroufe and Curkovic, 2008; Wiengarten et al , 2013). The common features found in the literature include information sharing (Disny and Towill, 2003; Sanders, 2008), collaborative decision-making (Tsay, 1999; Aviv, 2001; Groot-Kormelinck et al , 2021) and incentive alignment (Mowat and Collins, 2000; Stranieri et al , 2016; Chen, 2019).…”

“…For example, the lack of measures to eliminate or control identified hazards hinders the effective use of hazard analysis of critical control points (HACCP) in all stages of the SC. Therefore, to ensure the application of effective food QSs along an SC, SC members must communicate “farm to table food safety” rather than “farm to table HACCP” (Sperber, 2005) and communicate QSs and quality requirements to provide effective formal and informal quality monitoring mechanisms (Groot-Kormelinck et al , 2021).…”

“…SCQM can minimize agri-food product defects and reduce quality variation in agri-food SCs (Yang and Wei, 2013; Ben-Daya et al , 2021). Academia and industry have paid much attention to quality management in SCs to ensure food quality and safety by focusing on the development of quality traceability systems, quality risk analysis, quality coordination mechanisms, quality standards (QSs) and quality optimization, among others (Groot-Kormelinck et al , 2021; Aung and Chang, 2014; Hammoudi et al , 2009).…”

“…The key issue of SCQM is the dynamic interconnection of quality management activities throughout the SC. Through the SC dynamic capabilities, the SCQM practices run more smoothly between departments and node enterprises, realize the quality cooperation and control throughout SC members, which not only reduce the negative impact of information asymmetry but also reduce the risk of opportunistic behaviour, and promote quality performance (Groot-Kormelinck et al, 2021). In spite of these laudable efforts, the role of SC dynamic capabilities has been largely ignored in SCQM.…”

Diagnosing the service quality of perishable-food logistics: temperature-sensitive milk delivery

“…(2020) developed a cold-chain distribution model with time-window constraints and used it to determine that government time-window schemes could boost food quality, at least in urban settings. Groot-Kormelinck et al. ’s (2021) case-study-based investigation of how quality standards impacted food-chain contracts indicated that supply-chain stakeholders' transaction costs could be lowered if quality standards were aligned with contractual arrangements.…”