This study investigated the nature and level of market-oriented sustainability of Sjenica sheep cheese, a Serbian Protected Designation of Origin (PDO)-registered product. In the analysis of the supply chain market sustainability, three theories were used: Resource dependence theory, upper echelons theory, and signaling theory. The data were collected using a stepwise research design, applying techniques of observation and in-depth and telephone interviewing. The results show that the low recognition of the PDO label among Serbian consumers and all participants in the supply chain and the lack of the presence in the markets and large packages negatively impact domestic consumers in their decisions to purchase higher amounts of Sjenica sheep cheese. Small producers lack bargaining power, whereas their perceptions hinder formation of inter-organizational arrangements. The insufficient education of big producers and distributors impede the achievement of better business results. The main challenges for the export of Sjenica sheep cheese are the inadequate certification of this food product for the European Union market, the lack of standardized production process that results in variations in the product quality, and the unawareness of the regional consumers of Sjenica sheep cheese due to insufficient communication efforts.
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