SUS-CHAIN: Case Studies
Italy: Cooperativa Agricola Firenzuola – creating a national supply chain for organic beefThe well established non-organic beef-producers’ co-operative, ‘Cooperativa Agricola Firenzuola’ (CAF) in the region ‘Mugello’, decided to turn to organic farming in the second half of the ‘90s. Within the already existing co-operative, a new group of organic farmers was created.
The organic branch of CAF started in 1995 and 1996 with 2-3 organic farmers, slaughtering one calf per week. In 2003 CAF counted already 13 organic farmers. Due to the acceptance of buying meat from other 7 farmers (not belonging to CAF and outside of the region Mugello), 10-15 calves per week could be offered.
The sale of the non-organic beef has been supported over the past years by CAF through promotional actions linking the product with the territory and direct selling in specialised CAF stores. Concerning the organic beef, the first idea of the management board was to sell the organic beef also in the CAF stores. But as many members of the co-operative doubted that a ‘good’ distinction of the organic and the conventional beef would be possible, new outlets for the organic beef were searched.
Because of the BSE crisis and the increased concerns of consumers, CAF was able to find a supermarket chain (‘Esselunga’) that was willing to sell organic beef. All organic beef was sold via this marketing channel. This ‘new type’ of outlet opened up new perspectives to reach larger markets e.g. in Central and North Italy and to potentially provide higher incomes. Unfortunately in 2004 the big retailer (supermarket Esselunga) made big cutbacks of organic beef because of a general crisis of organic products demand. So this only outlet broke down and the organic beef producers of the co-operative were forced to think about new possible paths for the promotion and marketing of organic beef.
The case shows that the efforts to increase production and retail of organic beef were not accompanied by an appropriate marketing strategy. Having ignored the need for ‘external’ alliances with commercial agents, the cooperative found itself isolated and unable to find alternative outlets when demand dropped. Having chosen an exclusive relationship with the retailer, the cooperative has lost the ability to retain economic values within the region of production and it has given up the possibility to communicate to consumers the values on which the project was initially defined: the territory of origin and the small-scale farming reality. To sum up, the case confirms the importance for the organic sector to find innovative organisational patterns in order to face the process of scaling up while preserving the authenticity of the values embedded in the production system and the link with consumers.