Abstract

The Italian fruit and vegetable supply chain has been in a critical situation for several years. In recent times this situation has been getting even worse, mainly on account of the general economic crisis, which has triggered strong price competition among the great retail chains, resulting in a fall in prices at farm level. In this situation, the potato supply chain has become one of the weakest among the fruit and vegetables sectors in Italy. Both at farm and processing-industry level Italy has several characteristics that make it virtually impossible to compete with large producers in central and northern Europe. Consequently, the potato supply chain has been continually forced to innovate and make sustained efforts to valorise and differentiate its product from the largely mass produced one that is offered in Europe. This paper focuses on a locality in the province of Bologna that is one of the most important in the potato sector in Italy. Its aim is to analyse the supply chain and identify ways to turn round the present situation, which has very narrow margins and is unsustainable in the long term. More particularly, the study shows empirically that an increase in the level of integration between the actors in the supply chain is absolutely essential. This includes both horizontal integration, by concentrating supply among the producer organizations, and vertical integration, by extending the contractual arrangements between producers and traders right up to the final link in the chain, the mass distribution retailers. Another type of horizontal integration the study suggests is so-called organized direct showing how this emerging form of selling can be more suitable for a vegetable such as the potato, than other forms of direct selling (farm selling, farmers’ markets, etc.).

Full Text
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