Hybrid governance structures for quality farm products

This book studies the supply channels of quality farm products. As explained before, these initiatives can be seen as pioneering developments for a quality assurance system that restores consumer confidence and even convinces consumers to remunerate the specific quality. This contrasts with the standard food industry, which seems not to be able to regain the confidence of the consumer, despite all kinds of systems of traceable foods, quality assurance and integrated chain management. Another interesting aspect about the supply channels of quality farm products is that they seem to develop their own governance structures because the market is not functioning, or isn't functioning well enough, for the products they offer. Starting from these observations, the following research question is posed: Which governance structures are used by actors in the development of a new supply chain for quality farm products and why do they use the chosen governance structure? The supply channels for quality farm products are expected to develop a hybrid governance structure because they produce and market a specific quality which necessitates civic or domestic co-ordination, and because they involve collaboration between different independent actors. If all these initiatives can be classified as hybrid governance structures, the following research question imposes itself: Is it possible to classify hybrid governance structures into different classes with clearly defined and distinguishable characteristics? This book will try to answer yet another question, inspired by two observations. The first observation is that farmers, as producers of the primary agricultural products and in some cases also as producers of processed food products, play an important role in these innovative supply channels. The specific quality produced in these supply channels depends entirely on the quality the farmers deliver; this quality, however, often requires extra effort from the farmers. The second observation is that agricultural policy has changed and now stimulates these new supply channels for food products in order to support European agriculture, and in order to reduce the depopulation of the European countryside. These two observations together raise the question of incentives for the farmers to participate in these innovative supply channels: Are supply channels for quality farm products profitable for the farmers involved? This section started with the idea that these supply channels are acting as pioneers for the food sector; being a pioneer implies innovation and innovation implies investments and uncertainty. To determine if initiatives really play a pioneering, innovative role, the following research question was posed: Are the supply channels under study stimulating innovation? The analysis conducted to answer these research questions has led us to put forward the following central proposition. The stronger the quality requirements in the innovative supply channel and the more they influence all decision fields, the more the hybrid governance structure will be characterised by the strong authority of a central organisation, and thus the more it will approach an internal governance.