Cross-case analysis of producer-driven marketing channels in Australia

Abstract

Purpose - The purpose of the study was to investigate the feasibility of producer-driven marketing of differentiated meat, in the context of Australian family farms. Producer-driven marketing (PDM) is defined as marketing by farm families of their own produce by developing and managing their own supply chains beyond the farm-gate. Family farms are defined as family operated farms. The framework used compared revenue, costs and uncertainty in various distribution channels. Design/methodology/approach - Six individual case studies were conducted using semi-structured interviews. The interview protocol included enterprise characteristics that contribute to the ongoing viability of the businesses. Findings - PDM was a feasible entry point for new brands and a profitable alternative to supplying generic product to the mainstream when costs were controlled. It is proposed that PDM was feasible in the context of Australian family farms where the distribution channel chosen reduces variability in the farm-gate price, captures the marketing margin and minimises negotiation costs, particularly the labour costs to find a buyer. Research limitations/implications - The feasibility assessment excluded the cost of acquiring new skills which may be significant. The entrepreneurs interviewed already possessed significant marketing and business skills and experience to produce and market a brand through alternative distribution channels. Practical Implications - Producers can potentially increase farm profitability where household labour and skills are available to market produce beyond the farm-gate. These implications are likely to be relevant in most developed countries, not just Australia. Originality/value - The phenomenon of producer-driven marketing is relatively novel in Australian agribusiness with no previous analysis of the profitability and long-term viability of such an approach in the Australian context.