Fresh agricultural product logistics network governance: insights from small-holder farms in a developing country

Abstract

Fresh agricultural products (FAPs) require special handling to maintain product quality, especially during socio-economic crises. In developing countries, there is a compelling need for a robust supply chain governance strategy to regulate the supply chain actors involved in the logistics and distribution system. This paper proposes an innovative way to design FAP logistics governance to address specific problems in the FAP logistics networks of developing countries, where FAP supply chains are not well integrated. Three logistics governance scenarios were modelled using discrete-event simulation. The results revealed that the fully distributed governance could effectively reduce process delay and consequently minimise logistics costs, especially within the logistics networks serving multiple markets. This is due to that fact that the distributed governance allows the actors involved in the network to have some autonomy to manage their resources. The paper contributes to improving the fundamental understanding of the governance for FAP logistics networks consisting of small-holder farms. Our work also offers valuable insights for policymakers and practitioners into how to improve FAP supply chain management.

Does an Alternative Local Food Network Contribute to Improving Sustainable Food Security?

“…The most important thing is to provide food at an affordable price. The distribution strategy is a prerequisite for meeting food security in this uncertain era [12,44,49]. Based on this, developing a distribution system for local food is very important.…”

“…Optimizing the food network aims to reduce distribution costs, reduce carbon emissions during the distribution processes, mitigate food loss and waste during the logistics processes, and optimize added value and profits obtained by food network actors [45][46][47][48]. In addition, logistics governance is essential as part of an alternative strategy to improve food security and optimize food distribution networks sourced from local products [49].…”

Cold Chain Logistics Network Design for Fresh Agricultural Products with Government Subsidy

“…Constraint (5) imposes that only one type is selected for each open cold storage facility, and no type is selected for non-open cold storage facilities. Constraint (6) guarantees that the total investment of fixed cost for setting up cold storage facilities is no more than F. Constraint ( 7) is a binary restriction of y il -variables.…”

“…Plenty of producers of fresh agricultural products are smallholder farmers located in dispersed positions [6]. Cold chain logistics services for farmers are generally provided by third-party logistics enterprises.…”

Keprok tangerine supply chain management in Batu City and Malang Region East Java

“…Indicators of the success of a supply chain management for agricultural commodities including oranges are (a) increased margins and market knowledge for farmers as producers; (b) increasing the quality of the products produced; (c) increasing food safety guarantees; (d) sales volume increases significantly; (e) increasing the added value of the products produced [10]. In addition, successful agricultural commodity supply chain management must focus on customer or consumer satisfaction, ensuring logistics and distribution run efficiently, effective information and communication strategies, and building effective supply chain collaboration institutions [11]. If the SCM of citrus commodities goes well, there are at least 4 (four) benefits that can be obtained, namely: (1) there is added value including compliance with orders, accuracy in distribution, and conformity in charging production costs; (2) reduction of transaction costs resulting in a more customer-oriented market response; (3) reducing the risk of the citrus commodity business, namely providing marketing guarantees, capital development, as well as increasing efficiency and increasing the value of the produced citrus fruit commodities; and (4) SCM in the citrus fruit industry can be used as a means of transferring technology from partner companies to farmers in production centers.…”