Farm Firms Research Articles

Nexus between Competitive Business Strategy and Firm Performance: Moderating Effect of Competitive Intensity

ABSTRACT Business strategy literature argues that firm survival and growth in any competitive environment depend on the adaptation of suitable competitive business strategies. Despite the growing interest in strategic management within the fish farming industry, there is a notable lack of empirical evidence exploring how the competitive environment influences companies’ business strategy and performance. This paper examines the direct effect of competitive strategy and the moderating effect of competitive intensity on business strategy-performance relationship. Using hierarchical regression to analyze 306 samples gathered from fish farming firms of south-Benin, empirical evidence shows that competitive strategy including cost-leadership, and both product quality and marketing differentiation strategies impact positively firm financial performance. This research highlights the relative importance of product quality differentiation strategy. In addition, findings indicate that competitive intensity structure contribute to firm success. Surprisingly, findings show that competitive intensity does not significantly moderate the effect of cost-leadership and product differentiation strategies. Besides, the effect of marketing strategy on firm performance becomes more negative under high competition in the domestic market. Study recommends that firms should gain organizational economic outcomes by pursuing cost-leadership strategy and product differentiation strategy whatever competitive intensity states in the domestic market of fish farming.

Management practices and cow comfort of crossbred dairy cows in youth managed dairy farm enterprises, South Gondar Zone, Amhara Region, Ethiopia

Good dairy farming methods and cow comfort are essential variables in reproductive efficiency, milk output, milk quality, and dairy cow health. The purpose of this study was to look into the management techniques and cow comfort status of crossbred dairy cows in youth managed dairy farm enterprises in Ethiopia's Amhara region's South Gondar zone. All (20) youth-managed dairy farm enterprises were chosen and questioned using a pre-tested semi-structured questionnaire, and all (204) lactation dairy cows were chosen for cow comfort assessment. The SPSS version 22 program was used to analyze the data. According to the findings, the most common feed sources used for their dairy cattle were formulated and unformulated agro-industrial byproducts followed by non-conventional and hay. Piped (35%) and bore (30%) water were the most common water sources for dairy cattle, with the majority of farms allowing free access to water. The majority of dairy farm firms (70%) uses artificial insemination as well as bull services. The majority of dairy farm enterprises (55%) had shared sheds, followed by individual sheds (45%) built with government assistance (55%), and family (30%) with the same design and construction. The challenges confronting dairy farm enterprises were ranked feed scarcity and high feed costs first, followed by a lack of access to land, a lack of access to markets, and a lack of credit, whereas the opportunities for dairy farm enterprises were ranked first increased demand for milk and milk products first, followed by rapid urbanization, rapid population growth, and the availability of cheap labor. The vast majority of cows (92%) were severely lame, followed by moderate lameness (83%) and the vast majority of cows (52.5%) had moderately injured legs, followed by severely injured legs. The udder and leg cleanliness of most cows was mid cleanliness (52.7%), as opposed to dirty (30%) and clean (17.2%) with a low cow comfort index (0.48). The mean stall length, bed length, brisket board height, neck rail height, lung space, feeder height, and feeder width were 239±16 cm, 222.7±28.3 cm, 10.5±3.6cm, 61.5±15.3 cm, 128.15±21.5 cm, 40.6±8.7 cm, and 36.7±6.9 cm, respectively. The results also revealed that the overall floor softness scored marginal (45%) softness rather than hard (30%) and normal (25%) floor softness. The majority of dairy farm enterprises (55%) did not provide bedding material for their cows and, the bedding materials include straw, hay, and sawdust. Bedding materials are renewed once a month (37.5%), twice a week (37.5%), and once a week (25%). The frequency of manure removal was twice daily (60%), three times daily (30%), and once daily (20%). The findings revealed that the cow’s comfort status is poor, so it is recommended that the barn be renovated routine management practices be improved, and assistance from the government and other relevant stakeholders is required in order to obtain credit to renovate the cow barn and improve management practices.

Market opportunities seizing capability and fish farming firm performance: A dynamic managerial capability perspective

The role that owner-managers’ managerial capabilities play in agricultural firms' strategic change and performance is still unclear. A firm's market opportunities seizing capability (OSC) is a source of competitiveness and superior performance. The objective of this study is to establish how owner-manager's dynamic managerial capabilities (DMCs) including managerial human capital, managerial social capital and managerial cognition affect firm performance through the mediating effect of OSC, as well as the moderating effect of market dynamism in the relationship OSC and firm performance. 306 cross-sectional data collected at fish farming firms (FFF) level in southern Benin were used and partial least squares structural equation model was applied to test research hypotheses. The results of SmartPLS4 reveal that owner-managers’ DMCs including business ties (BTs), political ties (PTs), and managerial cognition (MC) demonstrate a significant effect at improving FFF market OSC and performance. Finding also underline the significant contribution of market dynamism to FFF performance as well the mediating role of market OSC in the relationship between BTs, PTs, MC, and FFF performance. Findings suggest that FFF owner-managers can achieve superior performance by strengthening their DMCs while improving market OSC. The study provides useful insights to FFF owner-managers, agriculture policymakers and practitioners who are engaged in agriculture firms' strategic management and sustainable performance.

A Small-Scale Farming Intervention Plan for Inclusive Economic Development in Rural South Africa

Small-scale commercial farming firms play a critical role in achieving the objectives of the African Union’s Agenda 2063, and the United Nations Sustainable Development Goals (SDGs) in the rural economies of Sub-Saharan Africa. South Africa has a sizeable number of households engaged in small-scale agriculture to supply rural market demand. Small scale commercial agriculture has become a key source of revenue, employment, and food security for communities in rural areas. As such, the South African government has been assisting small-scale farmers financially via the Micro-Agriculture Finance Institutions of South Africa and the Department of Agriculture, Forestry, and Fisheries. This support aims to alleviate poverty, create jobs, and improve food security by promoting small-scale commercial farming, primarily in rural areas. Despite this assistance, there is no clear strategy for achieving significant and evidence-based development. This study outlines a four-step intervention strategy for promoting small-scale commercial farming as a strategy for rural economic development in South Africa. These steps include defining a small-scale farming development strategy, and delineating production, performance, policy, and control measures.

The lack of dynamic competition and the market insufficiency for agricultural productivity growth: Implications for the role of the state

AbstractThis paper shows that there is lack of dynamic competition in agriculture, making the market mechanism of agriculture insufficient for bringing about technological innovations. The market insufficiency differs from market failures in that the former causes dynamic inefficiency and lack of growth while the latter causing static inefficiency in resource allocation at a point in time. As a result, farm firms represent a special type of business organizations lacking dynamic competition. This paper proposes and evaluates hypotheses about the shifting roles of the state and agro‐input supply sector in bringing about agricultural productivity growth across countries at different development stages.

The innovation interface between knowledge management and firm performance

ABSTRACT Although the evidence suggests that knowledge management (KM) is instrumental to superior firm performance, research on the mechanisms that mediate this relationship is still evolving. Using KM practices that support the knowledge-related processes (KRP) of knowledge creation, transfer, integration and implementation as the basis, we examine the relationship between the KM practices and firm performance. We also examine the mediating role of innovation in this relationship. The study focused on tank farm firms operating in Nigeria’s oil and gas industry, with data generated from 486 respondents. Results from Structural Equation Modelling showed that innovation partially mediates the relationship between the KM practices that support KRP and firm performance. The study reveals sustainability of firm operations as the most impacted qualitative performance dimension. Overall, the Knowledge-Based View is substantiated, and innovation is confirmed as an important KM antecedent of firm performance. The results provide useful contributions to theory and practice.

Growing-Service Systems: New Business Models for Modular Urban-Vertical Farming

To secure sustainable and resilient food systems, new approaches, innovations, techniques, and processes are needed. In recent years, urban farming firms have been developing and experimenting with innovative approaches to expand their offerings and connect with consumers in new ways. New business models are being developed to provide functions and services instead of traditional products to meet demands from consumers, retailers, and users. As such, modular growing systems are increasing in popularity to provide fresh produce, visual appeal, transparency, and other tailor-made functions and services in so-called “growing-service systems” (GSS). Using GSS approaches, firms are developing and providing modular and small-scale farms in restaurants, residential spaces, supermarkets, and other commercial spaces, often including a large degree of automation and optimization of digital solutions to remotely control their operation. Using qualitative methods, the aim of this study is to explore and analyze the development of these novel GSS systems, highlighting different strategies, business models, motivations, and challenges. The results illustrate the divergence in approaches to GSSs for vertical farming. This includes different scales of modular units and varying business models for capturing value from the combination of products and services. All of the systems include varying degrees of automation and digitalized solutions to ensure the services are monitored, which is done to improve growing conditions and improve the experience for the users. Business-to-business systems are being developed as both market expansion and awareness-building strategies, where modular units are provided as a rental or subscription model that includes a number of services. Business-to-consumer systems are being introduced as an alternative for consumers, particularly in urban areas, to have greater control and access over growing their own fresh produce. The modules are purchased by consumers, which includes a number of ongoing services from the GSS firms. By categorizing and exploring these systems, this article offers novel insights and a first endeavor to distinguish these new GSS systems in the growing segment of urban agriculture, controlled-environment agriculture, and product-service system literature.

Social Capital and Loan Repayment Capacity of Agripreneurial Groups' in Abia State, Nigeria

Entrepreneurship is the ability to take significant amount of risk while managing and organizing a new or existing business enterprise with the sole motive of making profits. Agricultural entrepreneurship, also known as agripreneurship is the ability of farmers or farm firms to take substantial risks while producing, managing, directing and marketing their agricultural produce. Agripreneurs are the agricultural entrepreneurs. Selected social capital variables such as years of membership in social groups/organizations, number of meeting attendance, cash and labour contributions of members, etc., were incorporated into the research to determine the agripreneurs’ loan repayment capacity in Abia State, Nigeria. A multi-stage purposive sampling technique was employed to select the respondents. Greater percentage of the agripreneurs were male. Mainstream of them were in their active and productive age, hence could form groups for easy access to credit or loans in their respective enterprises. The agripreneurial groups’ sourced their loans from money lenders, ROSCA (Rotating Savings and Credit Association), family and friends/relatives. Others sources were through microfinance banks, commercial banks, self-help groups, cooperative societies and savings collectors/mobile bankers. Majority of the agripreneurs were regarded as good credit risk. The major factors affecting the agripreneurial loan repayment capacity was trust, assets, interest rate and the loan duration. Agripreneurs should be encouraged to participate more actively in group activities, not just for what they can benefit but for what they can give; as effective participation accelerates access to pooled productive resources.

Benchmarking upper midwest dairy farm profitability

PurposeThe purpose of this research is to understand US Upper Midwest dairy farm profitability performance over time and across herd size. Profitability is broken down into asset efficiency and operating profit margin. The primary objective is to determine how much information is required to accurately benchmark farm performance.Design/methodology/approachFinancial ratios to measure profitability (rate of return on assets), profit margin (operating profit margin ratio), and asset efficiency (asset turnover) were collected from Michigan State University and the University of Wisconsin business analysis programs for dairy farms from 2000 through 2016. Financial ratio patterns were examined both across time and herd size. Annual distributions were divided into quartiles and the use of one to five-year averages were used to determine accuracy of quartile rank compared to true long-run farm profitability performance.FindingsFinancial performance across large herds was more uniform than across smaller herds. Small and large herd profitability performance converged in poor years but diverged in good years. Using three or more years performance greatly improved accuracy of benchmarking profitability.Originality/valueThe data utilized are very rich in the sense of the amount of variation across years and herd size. The results have important implications for farm financial management and benchmarking farm financial performance. Farm firms should benchmark multiple years of profitability before making major management changes to alleviate deficiencies.

Portuguese farming firms´ growth: do human capital and managerial capabilities matter?

This paper examines the underlying factors that might shape firm’s growth in the farming sector. In par-ticular, we investigate the effects of human capital and managerial capabilities on growth of Portuguese farming firms during 2003-2007. Relying on econometric models that control for survivorship bias, the results indicate that younger and top-educated employees are likely to foster farming firm’s growth. On the other hand, the effect of managerial capabilities appears to be somewhat weak on firms without separation between ownership and management. The flexibility to hire specialised and multidisciplinary management teams with managerial capabilities appears to yield economic payoffs on the farming sector.

Threshold investment and firm viability: Evidence from commercial poultry farms in Nigeria

AbstractRapidly increasing demand for animal protein in many countries in the Global South has generated an expansion of the poultry subsector. This sector is typically diverse, ranging from small backyard farms to commercial farms of varying sizes. As the subsector expands, little is known about the performance or viability of different sizes of operation. Is there a minimum investment required to establish a viable commercial farm? Focusing on Nigeria, Africa's largest economy and most populous country, this study uses nonparametric statistics, transition matrices, and parametric estimations to identify the equilibrium poultry farm size. We find consistent evidence of multiple equilibria, particularly a high‐ and low‐stable equilibrium separated by a threshold between small and large farms. Farms are highly likely to remain in the size category in which they begin; small poultry farms are unlikely to cross the threshold and transition to large ones. We also find that larger farms are better able to withstand a price shock than smaller farms, which are more likely to cease operations in the event of a shock. These underlying dynamics should be given due consideration by governments, donors and private sector as they enter the industry or encourage others to engage in it [EconLit citations: O12‐Microeconomic Analyses of Economic Development, L11‐Production, Pricing, and Market Structure • Size Distribution of Firms, Q12‐Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets].

Common and fundamental risk factors in shareholder returns of Norwegian salmon producing companies

Salmon farming companies are increasingly gaining attention from investors and portfolio managers. The last decade has seen a substantial growth in the securitization of salmon farming assets and prices. A growing literature demonstrates that industry-specific fundamental, as well as market-wide risk factors help explain stock returns. However, very little is known about the pricing of salmon stocks and especially the contribution of industry-specific fundamental risk factors. Using a multifactor model, we find that stock returns for salmon farming firms are significantly associated with both common market-wide risks and industry-specific risk factors.

Common and Fundamental Risk Factors in Shareholder Returns of Norwegian Salmon Producing Companies

Salmon farming companies are increasingly gaining attention from investors and portfolio managers. The last decade has seen a substantial growth in the securitization of salmon farming assets and prices. A growing literature demonstrates that industry-specific fundamental, as well as market-wide risk factors help explain stock returns. However, very little is known about the pricing of salmon stocks and especially the contribution of industry-specific fundamental risk factors. Using a multifactor model, we find that stock returns for salmon farming firms are significantly associated with both common market-wide risks and industry-specific risk factors.

Factors influencing farm investment in borrower and non-borrower farm firms in Tamil Nadu

Investment plays a vital role in the agricultural production process. It induces production and savings, further investment helps in the development of the economy. It plays an equally important role in farm economy especially in the era of technological revolution. The study was attempted to assess the impact of farm finance and investment on profitability of farms in Annur block of Coimbatore district. This block was purposively selected for the study since it has the highest number of borrowers for agriculture purpose from commercial banks and it also has the highest loan amount given for agricultural purposes. From the selected block, four villages were selected randomly for the study. The tools of analysis included conventional percentage analysis, returns to investment, net cash income. The borrower farms depend more on the Commercial banks (55.00 %) to meet their farm investment and it was followed by Regional Rural Banks (15.00 %) and Co-operative Banks (15.00 %). The contribution of relatives and friends to the total farm investment was 12.50 per cent and the money lenders contributed about 2.50 per cent to the total farm investment in the borrower farm firms. The gross income was calculated for the borrower and non-borrower farms, the results revealed that borrowers had higher gross income (Rs. 314301.07) than that of the non-borrowers (Rs. 208116.40). The major contributor of income for the borrowers was crop income (45.04 %), which was followed by livestock income (34.90 %) and then by non-farm and off farm income (20.06 %). In the non-borrowers crop income contributed (57.82 %) of the total income, followed by livestock income (25.62 %) and then by non-farm and off farm income (16.56 %). Returns from the investment were higher in case of the borrower farms as the returns from investment ratio was 1.61, whereas in the non-borrowers it was 1.15. The net cash income obtained was also higher in the borrower farms (Rs. 154818.75) than that of the non- borrower farms (Rs. 92980.67).

Value chain upgrading: Evidence from the Singaporean aquaculture industry

This paper examines the Singaporean aquaculture industry using an integrated perspective that draws on the global value chain and global production network approaches. The paper focuses especially on the upgrading efforts of the fish farming firms operating at the industry’s upstream node. Based on research and qualitative personal interviews with firms involved in the Singaporean aquaculture industry, this paper argues that the city-state’s wider institutional context – dirigisme in governing the utilization of land and sea space, and commitment to a liberalized trade regime to feed its populace – complicates the upgrading efforts of the fish farming firms. Notwithstanding the inherent complexities of economic upgrading per se, such findings prove that while upgrading is an effort driven by the firm and its cohort of stakeholders, the effort is unlikely to succeed if the broader institutional and regulatory environment that the firms are embedded in is not conducive.

Farm Entrepreneurs’ Intentions to Develop Pluriactive Business Activities in Finland

We contribute to the entrepreneurial intentions literature by applying the theory of planned behaviour and resource-based views to the model of active entrepreneurs’ intention to develop their pluriactive businesses. Using our 2012 survey data from farm firms in Finland, we address the limited focus on active entrepreneurs and their intentions to develop on-going income-generating, off-farm related business activities. We found that attitudinal proxy antecedents such as innovation, cooperation and growth for pluriactivity differ for active and non-active entrepreneurs and with respect to the entrepreneurs’ age and production line and innovation behaviour.

The Role of Pluriactivity for Continuity and Survival in Family Farm Firms

Abstract Our study focuses on family farm firms as an important and yet under-researchetype of family firms. We explore the entrepreneurial growth behavior in the context ofamily farm firms by focusing on the role of pluriactivity. By integrating the literaturof family business strategies, EO, and growth intentions, this study of 1618 Finnisfamily farms seeks to understand the idea of pluriactivity as a strategic orientatioof family farm firms leading towards the growth and renewal of their prevailinand future domains. Our study revealed that pluriactivity is associated with growthorientation and perceived strengths of the family farm firms. We identified foutypes of growth groups (Established, Growth-Driven, Experimenters, Stand-Stilland found differences in their pluriactive orientation. We suggest that pluriactivity aa strategic orientation affects the growth-intention of the family entrepreneurs anthe business renewal processes of the family farm firms. Entrepreneurs need to havcapabilities (knowledge, skills, experience) and willingness to change (motivationattitude, volition) when using pluriactivity as a strategic orientation as they affecgrowth behavior (EO). Lastly, we discuss with our results and make some suggestionfor future research avenues in family business strategy research.

A multi-agent architecture for lamb supply chain

Small and medium size farming firms are unaware of the modern production system adjustments available to improve efficiency in lamb production and the lamb supply chain. These factors have collectively led to many serious issues confronting the sheep industry such as the bullwhip effect, quality of carcass not meeting the specifications of abattoirs, retailers, etc. This paper is postulating a multi-agent scheme for the lamb supply chain, which addresses above-mentioned issues facilitating a feedback system. This scheme involves various autonomous agents having their unique roles and responsibilities at different stages in the lamb supply chain to make it more efficient and customer focused. This scheme will lead to profit maximisation for the farmer, abattoir, and customers enabling maximum utilisation of resources all along the lamb supply chain.

How the U.S. Farm Firm Has Evolved: A Conceptual Framework

Farm organization literature often focuses on the farm firm as a simple entity, where ownership and control is largely combined, a large amount of contractual relationships are informal, and optimal organizational choice can be examined using comparative static analysis. In this paper, we suggest a framework in which we distinguish how some U.S. farm firms have evolved to be a different organizational form in the 20th century. These differences include more separation of ownership and control, more formality, and more complexity. Farm firm evolution involves more complexity because of the interdependency of farm firms to improve performance and the addition of property rights to the farm manager to reduce transaction costs. Because of the assumptions on farm firm simplicity (lack of interdependency), and limiting discussion of optimal farm organization choice to the land and employment transaction, the current frameworks in the literature may fail to understand the evolution of farm organization. We develop a conceptual framework that incorporates the important dimensions to understand farm firm evolution.

Marketing Strategies for the Primary Sector: An Empirical Study

1. Introduction Marketing channels are very important in the farming sector since it comprises a large number of small agricultural holdings, most of the agricultural products are undifferentiated, and the farming enterprises are isolated for the final consumer (Ritson 1997). Distribution channel choice is one in which an organization can achieve its marketing objectives within the framework of its marketing strategy (Fifield 1992; Kotler 1994). A marketing strategy that an organization follows aims to identify a competitive and consumer advantage and therefore can be viewed as an integral part of the business strategy (Wind and Robertson 1983). Porter (1980) identified three internally consistent generic strategies for creating a defendable position in the long run for competitors in an industry. The three generic strategies that a firm may adopt are: (a) overall cost leadership, (b) differentiation and (c) focus. Following on from this, four broad strategies based on the above generic strategies were suggested by Fearne and Bates (2000): (i) cost leadership strategy, (ii) differentiation strategy, (iii) diversification strategy and (iv) specialization strategy. Kohls and Uhl (1990) argued that in the food industry most firms mainly adopt the following two strategies: product differentiation and market segmentation. It can be difficult to use the typologies of business strategies presented above to describe adequately the way agricultural businesses behave, due to the nature of farm firms (especially their small scale and dependence on family labour and management) and the environment in which they operate. Generally, little is known about the decision making process of farmers regarding marketing strategy selection and particularly about the factors and the farmers' characteristics that influence them to choose a particular strategic alternative. Some studies have sought to cluster farmers according to their strategic behaviour.. McLeay et al. (1996) identified five strategic groups of crop farmers in New Zealand, while Ohlmer, et al. (1998) clustered Swedish farmers in relation to their decision making. Carter (2001) examined the role of farms in the creation of new business in rural areas. Three groups of farmers were identified by Carter (2001) based on their relative engagement in additional business ownership activities: monoactive farmers, structural diversifiers and portfolio business owners. Distinctive group differences found in their personal, farm business, managerial characteristics and in their perceptions of business opportunities and constrains. Vesala et. al. (2007) explored the concept of entrepreneurial capability of farmers to diversify. Their main focus was on the entrepreneurial identity of portfolio farmers in Finland and the extent to which the differences between portfolio farmers, other farmers and non farm rural businesses can be explained. They found that portfolio farmers have stronger entrepreneurial identity than conventional farmers as well as they have the perception that they are growth oriented, risk takers, innovative, optimistic and having more personal control upon their business activities. Other studies have attempted to identify the factors that influence farmers to adopt a particular marketing strategy. For example, distribution risk is one factor that influences marketing decision making in the agribusiness sector. Risks that agricultural producers face are linked with decisions about the prices, quantity, quality, and the timing of delivery (Royer, 1995). Transaction cost was identified as another factor, which has significant impact on marketing decision-making (Hobbs, 1996). Age, education and farm profit are also, according to Hobbs (1997), some factors that affect farmers using live auction markets: the type of cattle, quick payment and the price received were the most important reasons for selling cattle live-weight. Mishra et. al. (2009) investigated the factors such as farm, operator and household characteristics, farm type and regional location of the farm, that affect the financial performance of new and beginning farmers. …