4.1. The Organizational Model of the Cooperative
The examined organization was launched in 2013 as a producers’ organization, which joined the production, packaging, marketing, and distribution activities with the collective trademark certification “Prodotti di Puglia”. The governance and organizational structure consisted of the following: (i) one president (elected by the members), (ii) the board of directors (made by seven members and elected by the shareholders) both committed to verify the respect of statutory and shareholders guidelines; while the number of shareholders was equal to 115 and they took part in decision making during the general assembly of shareholders (Table 1
). In addition, other minor partners (producer organization and local action groups) externally contributed to the cooperative’s activities and increased contractual arrangements among chain stakeholders. Additionally, the cooperative employed eight workers (two for the administration and six for the processing lines). The products basket of the cooperative included mostly cherries and tables grapes; nevertheless, as shown in Table 2
, several species of fruits (e.g., apricots, watermelon, figs, almonds, peaches, and plums) and vegetables (e.g., chicories, fennels, celery, salads and spinach) were produced.
The cooperative handled local processing plants owned by the cooperative (1110 m2
with a capacity of 35 q/hr.), distribution and logistics and sales. The producers participating were spread in the region (see Figure 1
) and the demand market covered included large-scale distribution, general markets, and intermediaries with a net turnover equal to about 10.8 million € (Table 3
, please note that data referred to 31 December 2017).
As explained in the previous section, the cooperative’s vision was aimed at the financial improvement of the F&V supply chain (especially for cherries and tables grapes) as follows:
Reinforcing the position of the producers on the market,
“This cooperative enhances ambitious challenge to face the market directly, without the intervention of intermediaries and traders who have indiscriminately controlled the distribution of our products”.
Ensuring that production is planned and adjusted to demand, particularly in terms of quality and quantity,
“Though the contracts within the cooperative, we can concentrate the supply to coordinately delivers input to the market”.
Concentrating supply and reaching high value markets (boosting regional food cluster),
“The shared vision of this cooperative is to promote the concentration of supply, the regularization of prices at the producer stage and the reduction of costs. Additionally, we supply our customers with quality products that respect social, environmental and economic standard”
Boosting the commercial value of products,
“We want to valorise the excellences of our territory and giving value to our products that are unique”
Optimizing production costs and stabilizing producer prices,
“Though this cooperative the limited-resource producers can be collected to optimize the production process and it also ensures producers stable and reasonable prices”
Improving horizontal integration along value chain,
“Within the cooperative shareholders work on principles of collaboration, shared decision making, open communication, shared vision, to give maximum value to the customer at low cost and minimum time in an efficient manner.”
Since it was founded, the cooperative has embraced the environmental measures and methods of production respecting the environment (at least 10% of the operational fund expenditure),
“We combine high quality products with sustainable and environmental respectful agricultural practices that are perfectly harmonized with the surrounding ecosystems”.
(from shareholders interviews)
The environmental goal was pursued by adopting sustainable practices in both farming and processing activities, reinvesting a percentage of the income in offering technical assistance services to lower inputs (e.g., fertilizers, pesticides) and to limit the use of natural resources (e.g., water use efficiency, carbon sequestration assessment). Additionally, in the last years (3 years), the cooperative had dedicated attention to minimizing food waste along the whole food value chain. This was realized by reducing farming and post-harvest losses (using anti-hail mesh for orchards and storage chamber) and by finding processing plants owned by third parties to manufacture production surplus (e.g., production of juices, purees and pulp),
“Food waste issue the has been discussed in our cooperative, considering that in some year for specific product (such as cherries) we even lose 50% of production. Therefore, apart from solutions such as hail nets and storage chamber, we are thinking to recover and process damaged products (second and third category products), but this represents a huge investment for our cooperative”
Empowering producers to create new jobs, as well as contributing to transfer knowledge among practitioners achieved the social goal. Nevertheless, the most important initiative embraced by this cooperative was to promote F&V consumption in the schools, by supplying at least 560 schools (increasing the daily fresh F&V consumption, preventing childhood obesity rate),
“We promote knowledge transfer by organizing trying initiatives and by offering consulting services. We also monitor the number of participants and the companies using consulting services”;
(from a member of BoD)
“Since 2015 we won for the first time the “Fruit in Schools” project that allows us to receive EU funds to encourage children to eat more fruit and vegetables and to adopt healthier lifestyles”
(we won this initiative for 4 years consecutively) (form a member of BoD)
The business model adopted by this cooperative reinforced the position of the producers in a market where the demand was more and more concentrated and structured, ensuring them a capital distribution and stable income. In this way, F&V producers have a better adaptation of supply to demand in terms of quantity and quality. Additionally, the cooperative’s model improves the relationship between businesses and territories while allowing entrepreneurs to deal with market changes. Moreover, it stimulates innovation, as well as supports sustainable returns on natural, economic, and social capital. Indeed, the collaborations established within the cooperative potentially allow small farmers to strengthen the horizontal relationships and establish new contractual arrangements (trust-based) with supply chain actors. They can also boost small farmers’ innovativeness (access to new technologies within the cooperative), especially with regard to sustainable techniques and technologies (Figure 3
This contributes to mitigate environmental impacts (soil protection, water sustainable use, water quality preservation, habitat, biodiversity, and landscape protection).
The horizontal integration process and the coordination among actors along the food supply chain contribute to adapt production to the market demand through coordinated management, and to affect market share, price stability, and quality control. A better production planning could contribute to reduce food waste generation. Moreover, the “fruits in the school” initiative, besides promoting healthy eating habits and more balanced nutrition among children, contributes to a fair distribution of the value-added supply chain of F&V. Indeed, based on value-adding activities, producers can earn a higher margin consumer and ensure a stable income.
4.2. Tensions Categorization and Resolution Strategies
The analysis of primary data, notes, and additional documents enabled us to identify and classify the nature of tensions. The first tension is linked to a lack of harmonization between financial issues and environmental sustainability goals (Figure 2
). Specifically, the ventures always have some problems in the choice of reinvesting their profits in the business to capitalize on the entrepreneurial activities or for the collective development purposes (one interviewee). Eight interviewees argue that in several cases they laid down the environmental goals to remain financially stable. For example, in some cases, they are forced to use more chemicals or plastic for packaging to avoid food losses (three interviewees). Accordingly, the interviews reveal a dissonance in perspective of sustainable practices (second tension). For example, some of them believe that the cooperative should put significant effort in lowering the impact of agricultural activities and tackling food losses and waste problems (11 interviewees). Interviewees (two) from the board of directors cited one operative project aimed at reducing farming and post-harvest losses, which no one else knew about. This denotes a lack of communication and coordination among the directory board and general members generating a misalignment of their activities in addressing environmental goals.
The third type of tension is related to the struggle between coordination and cooperation activities. This is due to the difficulties in defining specific actions for the cooperative’s operational program aligned with its vision. Such tensions were faced, for example, by the president and some members of the directory board (two interviewees) who always have some difficulties in deciding whether devoting time and resources in initiatives for knowledge and technology transfer. Additionally, several interviews attribute the cause of this tension to the cooperative’s expansion, especially after the award (F&V in the schools). They felt challenged in identifying and sharing the tasks required for achieving comprehensive socio-environmental goals.
The last tension is related to the learning process. Several members believe the socio-environmental mission success requires an extended horizon. While financial stability and certainty is achieved in the short term and can be easily assessed, the socioecological outcomes require a long time to be perceived. These different time horizons can lead to a trade-off in defining strategic actions (third tension). This occurs when they debate on which kind of technologies should be introduced and whether they affect the economic, social, or environmental dimensions (four interviewees). This is the case of a dispute that arose for the introduction of post-harvest technology to guarantee optimum quality and extended shelf life.
Our analysis shows that cooperative’s members manage the tensions by applying the resolution strategy [18
]. The resolution of conflicts was realized by addressing the multiples (socio-environmental and financial) goals of the tensions at different locations, “structural separation”, or at different times “temporal separation” [66
]. The structural separation was applied for managing the conflicts between coordination and cooperation activities; the cooperative decided to invest resources for knowledge transfer, for implementing technologies for chemicals inputs, and for improving water use efficiency.
Additionally, the cooperative further invests in measures concerning the implementation of certification standards (“Prodotti di Puglia” trademark). The same approach (structural separation) was applied to solve the dispute arising for the post-harvest technologies; the cooperative decided to invest resources to invite experts to relate in workshops to evaluate the complexity, compatibility, and adaptability of the technologies. This certainly helps them to facilitate the decision-making process. In line with Siegner et al. [46
], the temporal separation resolution was applied to solve the conflict among social, environmental, and financial purposes. For a temporary period, one purpose should be preferred against the other by considering their incompatibility.