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Supply chain flexibility

Duclos et al., (2003) define supply chain flexibility as ‘’the flexibility within and between all of the partners in the chain, including departments within and between an organisation, and the external partners, including suppliers, carriers, third-party companies, and information systems providers.’’ The increasing complexity of the food chains, value-added processes and the shortening of response times to demand changes are among key drivers of supply chain flexibility (Wilding, 1998). Managing complexity requires inter-firm coordination and this underlines the benefits of supply chain flexibility (Winkler, 2009). Tachizawa and Thomsen (2007) propose two strategies to increase flexibility of a supply chain: improved supplier flexibility and flexible sourcing. Gosling, Purvis and Naim (2009) describe supplier flexibility as the collective flexibilities provided by different suppliers in a supply chain and can be a combination of production, warehousing and transport flexibilities.
Sourcing flexibility is concerned with regularly reconfiguring the supply chain at a low cost and involves adoption of a larger supplier base (Tachizawa & Thomsen, 2007). Lee (2004) suggests integrating agility in a supply chain to enable a firm reduce impact of short-term changes in demand or supply. With a larger supplier base, a firm has options of ordering from suppliers with the lowest costs to ensure supply flexibility to offset supply uncertainty (Tang & Tomlin, 2008). To mitigate supplier commitment risks, Tsay and Lovejoy (1999) recommend the use of flexible supplier contracts that allow upward or downward adjustment of products or services offered. Tang and Tomlin (2008) suggest developing a portfolio of suppliers with flexible supply contracts, long-term inflexible supply contracts at low costs and more flexible contracts at higher costs. This offers operational flexibility to adapt and reduce supply risks, including currency exchange risks at supplier bases (Kouvelis, Dong, & Su, 2006).

Supply chain visibility

Modern food supply chains are increasingly extensive due to global nature of production locations, processing, packaging and markets (Hersh & Shaw, 2009) which makes tracking product information from farm to end consumers very complicated (Trace One, 2014). Supply chain visibility provides information to satisfy consumers’ increasing demand for reliable information regarding product origins, ingredients, processes, and practises associated with food they purchase (Susan, 2012). Consumers purchase products based on their specific needs and values such as; allergens free foods, carbon footprint, sustainable agriculture and fair labour practises (Maras, 2015). Food regulations are also increasing the need for firms to enhance network visibility (Fernandez, 2014). Firms stand to gain business benefits when they can better understand critical information of internal firm processes as well as know where food products originate from or points of sale and consumption (Susan, 2012). Product recalls and contaminations have significantly heightened consumer concerns about food safety and eroded consumer trust (Roth et al., 2008). In this case, supply chain visibility helps create transparency necessary to re-establish trust with consumers (Bailey, 2013).
Traceability is a key feature enabling supply chain visibility (Regattieri, Gamberi, & Manzini, 2007). Wilson and Clarke (1998) define food traceability as that ‘’information necessary to describe the production history of food products and any subsequent transformations or processes that the products might be subject to on the journey from the producers to the consumers plate.’’ EU mandates food operators to identify and document information on suppliers, customers, products and date of delivery (European Commission, 2007). Organic products are labelled according to the European Union Regulation 834/2007 (2007), which is the use of a logo and a code that describes the country of origin, the production method and a reference number (European Commission, 2015).

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Certification

A number of certifications are available to ensure food safety and to promote trust and confidence among consumers of organic products (European Union, 2007). Examples of these certifications include the IFOAM Norms (FIBL and IFOAM, 2016). In European Union (EU), Regulation 834/2007 defines the features of organic farming and products, the production rules, control systems, labelling, and trade applicable within EU region. The Codex Alimentarius from the Food and Agriculture Organization (FAO) and the World Health Organization (WHO) defines “international food standards, guidelines and codes of practice” (FAO, 2016). Most countries have a national certifier. In Sweden, KRAV certification has gained popularity since its creation in 1985 with a consumer awareness of 98% (KRAV, 2015). It has 27 members representing 4000 farmers and 2000 companies in processing and trade. To be certified, applicants must comply with more requirements than at EU level. These include social justice requirements preventing human rights violations, involuntary labour, protection of old-growth and natural forests and a maximum level of Genetically Modified Organisms (GMO) of 0,1%. (KRAV, 2015)
The European Union Regulation No 834/2007 (2007) defines the legal framework that aims at “ensuring fair competition and a proper functioning of the internal market in organic products, and of maintaining and justifying consumer confidence in products labelled as organic.” To use the organic logo, a producer must comply with a set of food regulations. Every supply chain actor undergoes inspection at least once a year or more depending on specific risks. EU legislation for organic products will be reviewed as illustrated in Appendix 3. The objective is to nurture consumers’ trust in a growing OFM. IFOAM EU Group (2014) emphasizes the need for these changes to address administrative challenges since “in some countries, we are facing a growing gap between demand for and production of organic foods”. Some measures proposed are; revocation of certification if pesticides limits are exceeded, with concurrent organic and non-organic farming, small-scale farmers could be certified as a group. (IFOAM EU Group, 2014; FIBL and IFOAM, 2016)

1. Introduction
1.2. Problem discussion
1.3. Purpose
1.4. Delimitations
1.5. Definitions
2. Frame of reference
2.1. Risk categorisation
2.2. Risk Assessment
2.3. Risk mitigation strategies
2.4. Theoretical Framework
3. Research Methodology
3.1. Research philosophy
3.2. Research purpos
3.3. Research approach
3.4. Qualitative research
3.5. Research strategy
3.6. Research design
3.7. Time horizon
3.8. Data collection
3.9. Data analysis
3.10. Research quality
4. Empirical Findings
4.1. Presentation of respondents
4.2. Risk assessment – Research question 1
4.3. Risk mitigation – Research question 2
5. Analysis
5.1. Risk assessment – Research question 1
5.2. Risk mitigation – Research question 2
5.3. Research framework
6. Conclusion
7. Discussion
7.1. Practical and Theoretical Implications
7.2. Reflections
7.3. Limitations and Further Research
References