A transaction cost analysis of the fruit supply chain in South Africa : a case study approach

Fundira, Takudzwa (2004-12)

Thesis (MScAgric)--Stellenbosch University, 2004.

Thesis

ENGLISH ABSTRACT: The agro-food sector is swiftly moving towards an internationally interconnected system with a large variety of complex relationships, due to year-round supply, product differentiation and developments in information technologies, with the aim of enhancing competitiveness. In this context, vertical linking in the agro-food business especially, vertical coordination has gained attention. A case study approach is used to analyse two fruit supply chains -the table grape and citrus fruit chain. The study uses a transaction cost approach to analyse the supply chain of the fruit industry in South Africa. Transaction cost analysis (TCA) represents one possible approach to understanding and evaluating supply chain management and has the potential to be combined in an interdisciplinary setting with the insights provided by the marketing, logistics and organisational behaviour literatures. By means of literature study, constructs are identified that help explain the choices made, with regard to governance structures and the sources of competitiveness of supply chains. The question of governance structures is addressed in transaction cost economics (TCE) where asset specificity is of major importance. The sources of competitiveness are addressed both in the literature study and from discussions undertaken with key industry representatives. The empirical application of the TCE theory helped demonstrate the extent to which the exporter has adapted to changes in the global environment. The study revealed that for both supply chains, the role-players overcompensate to minimise their risk. Hence vertical integration rather than outsourcing takes precedence. Bilateral contracting and strategic alliances should be given priority to enhance effective communication, commitment and collective decision-making. This growing recognition of the competitive advantage that can be gained through improving coordination in the supply chain is the starting point for SCM initiatives and, these are important signals that in the long run will determine the sustainability and competitiveness of the industry.

AFRIKAANSE OPSOMMING: Die landbou-voedsel sektor is vinnig besig om na 'n internasionale interafhanklike stelsel met 'n groat verskeidenheid van ingewikkelde verhoudings te beweeg, as gevolg van heel-jaar aanbod, produk differensiasie en ontwikkeling in tegnologie, met die doel om meer mededingend te wees. In hierdie konteks geniet vertikale skakelinge in die landbou-voedsel bedryf, en veral vertikale koordinasie, baie aandag. 'n Gevalle studie benadering is gevolg om twee vrugte waardekettings te analiseer -die tafeldruiwe en sitrus ketting. Die studie maak gebruik van 'n transaksie koste benadering om die waardeketting van die Suid-Afrikaanse vrugte bedryf te analiseer. Transaksie koste analiese (TKA) verteenwoordig een moontlike benadering om waardekettingbestuur te verstaan en te evalueer. Dit het oak die potensiaal om gekombineer te word in 'n interdissiplinere omgewing met insigte wat deur bemarking, logistiek en organisatoriese gedrags literatuur verskaf word. Konstruksies is met behulp van literatuur studies ge"identifiseer wat help om die keuses wat gemaak is met betrekking tot bestuurstrukture en die bran van mededingendheid van waardekettings. Die kwessie van bestuurstrukture word aangespreek deur transaksie koste ekonomie (TKE) waarin bate-spesifiekheid van groat belang is. Die bran van mededingendheid is aangespreek deur beide literatuur te bestudeer en deur besprekings met sleutel-figure in die bedryf. Die empiriese toepassing van die TKE teorie help om die mate waarin die uitvoerder aangepas het tot veranderinge in die globale omgewing aan te toon. Die studie bewys dat firmas in beide waardekettings oorkompenseer vir transaksie koste deur vertikale integrasie in plaas van kontrakte. Bilaterale kontrakterings en strategiese vennootskappe moet prioriteit geniet om effektiewe kommunikasie, verpligtinge en kollektiewe besluitneming te verbeter. Die groeiende erkenning wat gegee word aan mededingende voordeel wat gewen kan word deur koordinasie in die waardeketting te verbeter is die begin punt vir ketting initiatiewe en, dit is belangrike seine wat die volhoubaarheid en mededingendheid van die bedryf in die lang termyn sal bepaal.

Please refer to this item in SUNScholar by using the following persistent URL: http://hdl.handle.net/10019.1/49864
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