Developments and Development Directions of Electronic Trade Platforms in US and European Agri-Food Markets: Impact on Sector Organization

M. Fritz, et al. / International Food and Agribusiness Management Review Volume 7, Issue 1, 2004

Introduction

The provision of food builds on a vertical chain of subsequent production, service
and trading processes that reach from the production of agricultural inputs to the
delivery of final food products to consumers (food supply chain, FSC). Enterprises at
various stages of this chain contribute to the production and service processes and
exchange or trade goods with their suppliers and customers. Basic models of the
food supply chain (Davis et.al, 1957; Zylbersztajn, 1996; McCorriston, 2002) specify
a number of distinguished stages and the market linkages between them (fig. 1).

Focus of
this paper

Figure 1: General Food Supply Chain Model
(adapted from McCorriston, 2002)

Faced with challenges from increases in globalization, competition, and market
concerns regarding food quality and food safety, enterprises in food supply chains
need to adapt their traditional business models and improve the efficiency of
processes and their interaction throughout the supply chain. Key success factors
involve improvements in the information and communication infrastructure of
enterprises and the food supply chain, and the utilization of opportunities provided
by modern information and communication technologies (ICT). In utilizing ICT
support, emphasis was initially on internal processes of enterprises. However, the
advent of the Internet communication network has opened new support
opportunities with high improvement potential specifically for trading and
interaction activities on all levels of the supply chain.

These opportunities are commonly referred to as ‘E-Commerce’ and focus on all
types of trade-related activities, either between enterprises (for a food chain related
discussion of ‘B2B e-commerce’; see, e.g., Schiefer et al., 2001, Leroux et al., 2001,
Boehlje et al., 2000 or Mueller, 2000 for) or between enterprises and consumers at
the end of the food supply chain (‘B2C e-commerce’, see, e.g., Sawhney, 1999 or
Duval, 2001). Trade-related activities that deal, a.o., with the marketing, selling,

© 2004 International Food and Agribusiness Management Association (IAMA). All rights reserved.

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