Vertical Coordination Of Agricultural Supply Chain

As we all know, a correlation between a lot of agricultural produces and food. People pay attention to food safety more seriously, and demand for food on the new, special, the green safety more higher, then consumers will be more attention to the agriculture and food-related production source.The decentralized management and the fragmentation producers in the current agricultural production, which are bound to have contradictions with that demands. Therefore, building and improving the agricultural supply chain is imperative. It is asked for that the various participants have effective collaboration in agricultural supply chain. And many scholars and consumers think about the agricultural products supply chain which the establishment and improvement of either producers to promote or market demand to pull. Therefore, the more concern is that farmers, agricultural products supermarkets, which has made a large number of studies and explorations. Government and agricultural products supermarkets are actively associated practice. However, the collaboration participants in a sound agricultural supply chain, is not just farmers and consumers. What is more, it is including a large number of agricultural produce processing enterprises. They are the main important parts in the supply chain of agricultural products. With the upper and lower reaches of the collaboration between the enterprises of agricultural products supply chain will be the establishment and improvement of playing a decisive role.This paper is based on supply chain management theory, the transaction cost theory and organization theory and other theories ;based on a qualitative analysis and quantitative analysis of the survey data analysis and integration 17 cities and counties in Sichuan Province to the 90 samples of agricultural products processing enterprises, study vertical coordination in agricultural supply chain. This paper mainly from the perspective of agricultural products processing enterprises, namely farm produce processing enterprises and examine the relationships between suppliers and vendors and the relationship between the vertical coordination approach, such as the choice of several aspects. Multinomial Logit Model will be used to study the factors and mechanisms of vertical relationship in the agricultural products supply chain coordination. On the basis, it makes recommendations and responses.The main conclusion of the study are as follows:(1) By studying on the relationship of agricultural products processing enterprises and the suppliers, it shows that the vertical coordination approach used for more than spot transactions and contracts. Processing enterprises with the establishment of field planting and breeding main objective is to protect the quality of raw materials, the protection of sources of raw materials. In the transactions with suppliers, processing enterprises with a contract is most worried about the quality of products supplier and not timely and not enough delivery.(2) For vendition, processing enterprises mainly sell products with wholesalers. In sales, mainly in contract sales and marketing methods. In cooperation with vendors, it is the main difficulty for processing enterprises: money can not be received in a timely manner, product price volatility, transportation difficulties.(3) Multinomial logistic regression analysis shows that many factors will be a significant impact on choice of different vertical coordination approach for agricultural products processing enterprises, such as enterprise fixed assets, purchase of raw materials, information exchange frequency, default penalties, sharing of information, knowledge of interests distribution, attitudes of investing cooperation. But whether long-term cooperation between the impact of factors such as not significant. Grains processing enterprises more inclines to choose the spot transactions and contracts rather than vertical integration. But it is negative correlativity between the fixed assets and spot transactions, and it is not significant in contracts and vertical integration mode. In the contract information-sharing is higher than spot transactions. It is positively correlated between attitudes of investing cooperation in Upstream and downstream with the choice of vertical coordination approach.(4) Study on the vertical coordination mechanism in agricultural products supply chain shows that the agricultural products processing enterprises inspire with the organization, credibility, factors and orders incentives. Compared with other industries, based on the food safety point of view, the price incentive is not clear. Its restraint mechanisms have certain differences for different vertical coordination approaches in the Agricultural products supply chain. Spot transactions mainly rely on the market mechanism to restrain. And others is mainly through mutual supervision, and access to the system and certain punitive measures to achieve binding along members.