Power, supply chain integration and quality performance of agricultural products: evidence from contract farming in China

Abstract

Improving the quality of agricultural products is crucial for facilitating sustainable agricultural development. One widely embraced approach is contract farming, which generates guarantees—necessary for sustaining the continuous operations of vulnerable farmers—while enabling manufacturers to manage the aggregate supply chain risks and prices. Although management researchers have investigated power and quality performance issues between organisations, few have examined their impact on contract farming. This paper extends the literature by examining the relationships between power, supply chain integration and the quality performance of agricultural products, from the perspectives of farm households and agribusiness companies in contract farming. This study proposes and empirically examines a model, applying survey data from 78 agricultural companies and 321 peasant householders in China. The results show that different types of power have different effects on contract farming. In particular, non-economic power significantly and positively affects supply chain integration. Its impact on process coordination is greater than its impact on information sharing. The effect of economic power on supply chain integration is different from the binary perspective. These findings have positive theoretical and practical significance for agribusiness and will help farmers to improve the quality of primary agricultural products and achieve sustainable agricultural development.

Keywords:

• Contract farming
• power
• supply chain integration
• quality performance
• binary perspective

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Funding

This research was supported by the National Planning of Philosophy and Social Science Foundation of China (16BGL128; 19ZDA115; 19BGL256)

Notes on contributors

Shaoling Fu

Shaoling Fu is a professor in College of Economics & Management at South China Agricultural University, Guangzhou, China. She received the Ph.D. degree from South China Agricultural University and M.A degree from South China University of Technology. She was a visiting scholar of Mays Business School in Texas A&M University, TX, USA. Her research interests are operations management, supply chain integration and agricultural supply chain management. Her work was published in the Industrial Management & Data Systems, Sustainability, European Business Review, Chinese Management Studies and others, a book called ‘Empirical Research on Agricultural Alliance Stability: an Example from “a Company + Farmers” Mode’.

Yuanzhu Zhan

Yuanzhu Zhan is a lecturer in Operations Management at the University of Liverpool. His research interests are in the areas of operations management, big data and analytics, innovation management and sustainable supply chain management. Yuanzhu has a large amount of industrial experience in both the UK and China. His research has been published in various journals, including the International Journal of Operations and Production Management, European Journal of Operational Research, International Journal of Production Research, International Journal of Production Economics, Transportation Research Part E: Logistics and Transportation Review, Annals of Operations Research and R&D Management. 

Jun Ouyang

Jun Ouyang is an associate researcher in Human Resource Department at South China Agricultural University, Guangzhou, China. His research areas include management of agricultural enterprises and higher education management. He has published more than twenty articles in various Chinese journals.

Yalan Ding

Yalan Ding is an operator in S.F. Express, Shenzhen, China. She received her B.A degree in Logistics Management at Beijing Wuzi University and M.A degree in Supply Chain Management at South China Agricultural University. Her research areas include supply chain integration and sustainable supply chain management. She has authored a research article in Sustainability.

Kim Hua Tan

Kim Hua Tan is a professor in Operations and Innovation Management. Prior to this, he was a researcher and teaching assistant at Centre for Strategy and Performance, University of Cambridge. Professor Tan spent many years in industry, before joining academia in 1999. His current research interests are lean management, operations strategy, decision making, and supply chain risk management. Professor Tan has published a book called ‘Winning Decisions: Translating Business Strategy into Action Plans’, and numerous articles in academic journals such as Decision Sciences, International Journal of Operations and Production Management, International Journal of Production Economics, International Journal of Innovation Management, and others.

Lingmei Fu

Lingmei Fu is a civil servant in the Peoples Government of Wenfu Town, Jiaoling County, Meizhou City, Guangdong Province, China. She completed her master degree from South China Agricultural University. Her research areas include Supply Chain integration of agricultural products and agriculture-related Enterprise Management.