Transitioning from Transaction-Based Markets to Alliance-Based Supply Chains: Implications for Firms

Choices 4th Quarter 2005, 20(4)

This article discusses the consequences of the changes that are evolving in food supply chains. The basic notion is that the basis for rivalry is shifting in the interdependent "farm gate to plate" food industries. The discussion focuses on vertical network coordination or alliance-based supply chains as one specialized response to this new basis for rivalry. How these responses result in transitioning away from transaction-based markets is discussed, particularly for commodity markets. Value capture has enhanced the need for supply chain participants to correctly identify the target market space. The authors argue that food supply chains have unique characteristics based on the nature of vertical dependencies found within chains.

Full article available at http://www.choicesmagazine.org/2005-4/supplychain/2005-4-12.htm