recentpopularlog in

Copy this bookmark:





to read

bookmark detail

Supermarket Challenges and Opportunities for Producers and Shippers: US Experience1
February Quarter 2005 | Farm Policy Journal Vol. 2 No. 1 |Roberta Cook
Extension Marketing Economist, Department of Agricultural and Resource Economics.

The United States fresh fruit and vegetable market place has undergone consolidation in recent years, the
result being fewer, larger buyers who cater for large retailers. A large proportion of fresh produce is now
sold directly by shippers to retailers, bypassing intermediaries and wholesale markets. Transactions in
this consolidated market place involve more complex sales arrangements which can include off-invoice
fees and also quality, packaging and food safety requirements. More buyers in the food retail industry
are moving to seasonal and annual contracts which vary considerably for any given commodity. The
foodservice industry is also increasingly purchasing directly from shippers based in production regions.
Consolidation of food retail grocery stores has induced consolidation of shippers as firms attempt to match
the scale of the few, larger buyers. Shippers are now more market orientated and seek growers willing to
make changes necessary to be part of a more tightly controlled, yet geographically dispersed supply chain.
Contracts between shippers and producers are typically not fix-priced contracts, and focus on meeting
year-round consumer demand. Shippers reduce seasonal supply variation using imported products which
has implications for early and late season producers who may permanently face lower average prices.
Ultimately producers benefit by marketing through a shipper who can accurately reflect both shortand
longer-term market signals and can also assemble larger supplies of consistent quality products.
grocery  supermarkets  shippers  fresh_produce  OPMA  farming  agriculture  fruits  vegetables  consolidation  challenges  opportunities  Roberta_Cook 
june 2012 by jerryking
view in context