shaping a more sustainable food industry1187588/fulltext01.pdf · sustainability issues. this due...

IN DEGREE PROJECT INDUSTRIAL MANAGEMENT,SECOND CYCLE, 30 CREDITS

, STOCKHOLM SWEDEN 2017

Shaping a more sustainable food industrymapping different sustainable organisations' business model

BORLO VITTORIA

GIUDICE NICOLÒ

KTH ROYAL INSTITUTE OF TECHNOLOGYSCHOOL OF INDUSTRIAL ENGINEERING AND MANAGEMENT

www.kth.se

Borlo Vittoria Master Thesis 2017:2017:119 Giudice Nicolò Shaping a more sustainable food industry

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Shaping a more sustainable food industry

Mapping different sustainable organisations' business model

by

Borlo Vittoria Giudice Nicolò


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Master of Science Thesis INDEK 2017:2017:119

KTH Industrial Engineering and Management Industrial Management SE-100 44 STOCKHOLM

Master of Science Thesis INDEK 2017:2017:119

Shaping a more sustainable food industry

Borlo Vittoria

Giudice Nicolò

Approved

2017-06-01 Examiner

Gregg Vanourek Supervisor

Terrence Brown

Commissioner

UPV- Universitat Politècnica de València

Contact person

Jose P. Garcia Sabater

Abstract It is scientifically proven that the actual consume of natural resources cannot sustain the European life style of the entire world population forever. Therefore, sustainability is a very hot topic right now. The food industry counts for the 30% of the global pollution. The food industry needs to become more sustainable. Therefore, this research investigates the "triple sustainability" concept, by developing and applying a sustainable model. That is used to evaluate organization's sustainability. The purpose is to investigate and map different existing sustainable business models which aim to increase the consumption of sustainable food in two different geographical clusters. The conventional food supply chain makes critical and difficult to handle some of the sustainability issues. This due to existing economies of scale and market networks, build of many intermediaries between production and consumption. Therefore, we analysed a more innovative food supply chain: the Short Food Supply Chain and the derived concept of "local food". The research question of this study is: "How different sustainable business models respond to


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the sustainability issue in two different geographical areas?". To analyse the sustainability, we develop a model. Moreover we analysed the similarities and differences in the two different clusters. We found that there are no remarkable differences in the business model used. We also report the analysis about the reproducibility of the business model. At the end, we suggest future researches.

Key-words Food sustainability; Sustainable Business Model; Sustainability evaluation; Sustainable organization; short food supply chain; local food; organizations' differences in different European areas; Sustainable food industry; triple sustainability.


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Summary DEFINITION & ACRONYMS 12

CHAPTER 1: INTRODUCTION 14

1.1 BACKGROUND 14 1.2 PROBLEM FORMULATION 16 1.3 PURPOSE 16 1.4 RESEARCH QUESTIONS 16 1.5 DELIMITATIONS 17 1.6 MASTER’S THESIS FRAMEWORK 17

CHAPTER 2: LITERATURE 18

2.1 BUSINESS MODEL 18 2.2 CROSS-NATIONAL CLUSTERS 19 2.2.1 NATIONAL CULTURE AND CROSS-NATIONAL CLUSTERS 20 2.2.2 FOOD QUALITY RELATED TO THE TWO CLUSTERS 22 2.3 SUSTAINABLE FOOD 25 2.4 FOOD SUPPLY CHAIN TODAY 28 2.4.1 CONVENTIONAL FOOD SUPPLY CHAIN TODAY AND ITS CONSEQUENCES 28 2.4.2 SHORT FOOD SUPPLY CHAIN DEFINITION. 30 2.4.3 DIFFERENT PERSPECTIVES ON SFSC 31 2.4.4 CHARACTERISTICS OF THE SFSC 34 2.5 LOCAL FOOD 35

CHAPTER 3: METHODOLOGY 37

3.1 SCIENTIFIC APPROACH 37 3.2 CREATING SUB-QUESTIONS 37 3.3 DATA COLLECTION METHOD 38 3.3.1 PRIMARY DATA 38 3.3.2 SECONDARY SOURCE DATA 44 3.3.4 RESEARCHING DIFFERENT SUSTAINABLE ORGANIZATIONS 45 3.3.5 BUSINESS MODEL ANALYSIS METHOD 46 3.4 SCIENTIFIC QUALITY 48 3.4.1 VALIDITY 48 3.4.2 RELIABILITY 49 3.4.3 GENERALIZABILITY 50 3.5 ETHICS 50


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CHAPTER 4: RESULTS 52

4.1 GENERAL DESCRIPTION OF THE ANALYSED BMS 52 4.2 INITIAL CONDITION TO START THE BM 56 4.3 FUNDAMENTAL VALUE OF THE ORGANIZATION 57 4.4 CHARACTERISTICS OF THE MODEL 58 4.4.1 VALUE PROPOSITION 59 4.4.2 CLIENTS 62 4.4.3 REVENUE MODEL 64 4.4.4 RESOURCE AND ASSETS 65 4.4.5 COSTS 66 4.4.6 PROCESS AND ACTIVITIES 67 4.4.7 SUPPLIER 68 4.4.8 FINANCING 69 4.5 CRITICISM 70 4.6 LOCAL FOOD 70 4.7 DIGITALIZATION OF SERVICES 71 4.8 SUSTAINABLE MODEL 72

CHAPTER 5: ANALYSIS 75

5.1 SFSC - SHORT FOOD SUPPLY CHAIN 75 5.2 THE BUSINESS MODEL'S SUSTAINABILITY 77 5.3 THE BUSINESS MODEL CHARACTERISTICS IN DIFFERENT CLUSTERS 81 WE NOW REPORT THE BM’S DIFFERENCES OF THE TWO CLUSTERS. 82 WE NOW REPORT THE BM’S SIMILARITIES OF THE TWO CLUSTERS. 82 5.4 ANALYSIS OF THE STUDY’S RELIABILITY AND VALIDITY 83 5.5 CRITICISM 84

CHAPTER 6: FINDINGS 85

6.1 SHORT FOOD SUPPLY CHAIN 85 6.2 THE BM REPRODUCIBILITY 86 6.3 BM FEATURES: SIMILARITIES AND DIFFERENCES. 87 6.4 RECONNECTION TO THE PURPOSE 87 7.1 CONTRIBUTION TO KNOWLEDGE 89 7.2 FUTURE WORK 89

REFERENCE LIST 90

WEB SITES: 94

REPORT AND CONFERENCES 95

APPENDIX 96


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APPENDIX A: JUSTIFICATION OF COUNTRIES IN DIFFERENT CLUSTERS 96 NORDIC CLUSTER 96 LATIN EUROPEAN 97 APPENDIX B: INTERVIEW’S STRUCTURE FOR THE ORGANIZATION 99 APPENDIX C: TEMPLATE FOR PRELIMINARY BM ANALYSIS 106 APPENDIX D: THE SUSTAINABLE MODEL. 107 SOCIAL SUSTAINABILITY 107 ENVIRONMENTAL SUSTAINABILITY 110 ECONOMICAL SUSTAINABILITY 114


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Dedication. We would like to thank all the people assisting and supporting during the whole writing process. Especially the two professors (Terrence and Jose), the interviewees who dedicated to us their precious time, all the people involved in the write storming, all the people that we get in contact with during this period of time, all our families and friends (who with pressure, who with beers, who with a big smile, helped us during this). We also want to say a very special thanks to a friend who correct all the language through the report. Moreover, we need to give a dedication to two countries that have host us, Spain and Sweeden. And thanks to the whole word and to all the people which are investing their life to shape a better world. We are dedicating this to every one.


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List of table Table 2.1: The nine elements of the business model Table 2.2: Summary of culture difference founding from different authors Table 2.3: The two geographical clusters Table 2.4: Consumers' requirements in the Nordic Cluster Table 2.5: Consumers' requirement in the Latin European Cluster Table 2.6: Characteristics of sustainability Table 2.7: Definition of “local food” Table 3.1: Structure of semi-structured interviews for the experts we interviewed Table 3.2: Interviewed experts in the food industry – primary sources Table 3.3: Interview template for sustainable organizations Table 3.4: The interviewed people belonging to the sustainable organizations Table 3.5: The participants of the write-storming Table 3.6: The SOs we interviewed Table 3.7: SOs which had not been interviewed Table 4.1: Sustainable Organization's description and number Table 4.2: Sustainable Organization's description and letter Table 4.3: Dimension of each BM Table 4.4: The main strength of each BM Table 4.5: Organization's value proposition Table 4.6: The relationships between the organization and the end customers Table 4.7: The source of income for the different organizations Table 4.8: Cost model and structure of the SOs Table 4.9: The main processes of the organizations Table 4.10: The definition of local food for the SOs Table 5.1: Mapping the triple sustainability for the SOs List of image Image 2.1: Reineck's 30 KPIs Image: 2.2: Funnel scheme of the supply chain in the agri-food sector. Image 3.1: Social sustainability Image 3.2: Environmental sustainability Image 3.3: Economic sustainability Image 3.4: Framework followed for our analysis Graph Graph 1: Triple sustainability level of single organization Graph 2: Triple sustainability level of single organization Graph 3: Triple sustainability level of single organization


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Graph 4: Triple sustainability level of single organization Graph 5: Triple sustainability level of single organization Graph 6: Triple sustainability level of single organization Graph 7: Triple sustainability level of single organization Graph 8: Triple sustainability level of all the organizations compared


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Definition & Acronyms Acronyms used in the paper:

x SFSC: Short food supply chain. x CFSC: Conventional food supply chain. x KPI: Key Performance Indicator. x SO: sustainable organization. x BM: Business model. x EOD: Earth Overshoot Day. x EU: European Union.


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Definition: Community: is a group of people. They interact between each other and share some particular characteristics in common. Group´s dynamics are highly important. Territory: represents the environment, the society and their interactions of a geographical area. High quality food: food which has been produced with a high level of attention towards sustainability. Moreover it has high hygienic standards and high nutritional values (i.e. healthy food). Organization: An organization is a group of people who share interest in the same business. They work together in an organized and official way, which could be either a cooperative, an association, a profit or no profit company. Small organization: has between 1 and 9 (full time) people who are actively and directly working in the organization.

Medium organization: has between 10 and 60 (full time) people who are actively and directly working in the organization.

Client: are all the organizations and person who buy a products or services, they are consumers and also intermediaries.

ASL (Azienda Sanitaria Locale): Regional public entity responsible for the national health service in Italy


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Chapter 1: Introduction This chapter introduces the research project to the readers. In this chapter, we included most of the main areas touched in this research. We start introducing the research topic. This leads to the problem formulation and purpose of this study. They drive the readers to the main research question (and consequently to the sub questions). The chapter ends with the limitations of the study. Finally, we explain how this project was born (i.e. its framework).

1.1 Background The “Earth Overshoot Day” (EOD) is the critical date, which declares when the world´s population consumes all the available resources for the current year (Betti, 2016). For instance, in the 1970, the EOD was on the 23rd of December. Since 1970, the EOD day has fallen earlier and earlier in the year. Last year (2016) the EOD was on the 8th of August, which is five days earlier then the previous year. It caught everybody's attention on the resources of this planet. The ways of how people are living is not longer sustainable for just a single planet. That is why everybody should make an effort and invest energies in order to conduct a more sustainable everyday style of life. Every aspects of our life can be evaluated from a sustainable point of view. Everyday we have an incredible amount of choices to make that might have an important impact on the global sustainability. They range from how we physically move to how we decide to feed ourselves or to how we work and how we interact with the environment and the society around us. The only food industry counts for 30% of the global pollution (2012), to this we have to add as well all the activities that are supporting the food industry (such as transport, fertilizing and pesticide industries) (TED, Tristram Stuart, 2012 ). This large amount of pollution is due to many reasons (such as transports, productions methods, over productions, waste). Furthermore, there is a double negative effect. From one side we have a lot of transport throughout the whole supply chain and, from the other side, we have a lot of waste at the end of the supply chain. It has been calculated that between 1/3 and 1/2 of the world food production is not consumed (Gustavsson et al, 2011; Bio Intelligence study, 2010). The European Commission calculated the amount of food wasted in the EU in the year 2016. Such amount is around 88 million tons. It generates 143 billion of euro of waste (Fusion, 2016). The last International Exposition (Milan Expo 2015) focused its attention on this topic: how we can feed the planet in a sustainable way. This exhibition had the effect of denounce the wastes and the low attention on the sustainability issue in the food industry. Around 1-2 centuries ago in Europe, eating habits were just for feeding our bodies and for satisfying our primary needs. At that time, 95% of the population was working in agriculture


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in order to provide food, mainly for their families. Today just 5% of the European population is employed in the agriculture (2016). Nevertheless, the European population has been more than doubled and we eat and waste then three times more than in the past. In addition to this, we eat more processed and unsustainable food, such as junk food, meat, processed food and not seasonal food. This change is due to different factors such as innovations, technologies and mechanizations. In the developed countries, eating is not a need anymore. It becomes an assured pleasure which allows us to focus our energy on other fields. Today thanks to different factors (such as an increased awareness, sensitization, healthy reasons) more and more people are careful about what they eat. They want to be more informed about what they eat and - therefore - this influences their purchasing decisions. Now we are still looking for pleasure but we aim to be more and more responsible of our choices‟ consequences. Different organizations develop new business models which aim to grasp this new “qualitative” demand and they aim to shape a new sustainable food industry. During the universal expositions (Milan Expo 2015) the main message was to start new food processes, supply chains, production‟s methods, in order to re-shape the whole food industry. The new food industry needs high attention on the sustainability issue. All actors involved in the food chain have a role to play in preventing and reducing food unsustainability. From those organizations which produce and process foods (farmers, food manufacturers and processors) to those which make food available for consumption (distributor, retailers, supermarket) and ultimately consumers themselves.

Those factors, connected with consumers‟ needs, open new opportunities for small and medium food producers to enter into the market. Since for the conventional supply chain is hard and difficult offer this closer shop experience to address the new customer's needs. So new business models are popping up. They want to directly reach consumers and to increase the availability of sustainable food. They are leveraging different aspects: strong values; technology (digitalization); innovative concepts such as sharing economies; changing in consumers‟ behaviours, and so on. As a result, they are based on stressing different consumers‟ values (quality products oriented, more sustainability oriented, etc…). How different business models (i.e. organizations) address the sustainability issue is part of the study of this research.

Sustainability had been considered from the “triple bottom line of sustainability”, which means from the following different point of view. The is economic. The organizations should financially maintain themselves over a period of time. The second aspect is society. The organizations need to take into high consideration people and society‟s needs, requirements and wellbeing. The last aspect is environment. Organizations have to take care of the future of the world environment, allow future generation to live in the same condition as we live


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today. Organizations have to pay high attention and take over responsibility on these factors in order to be sustainable in a log term prospective.

1.2 Problem formulation It is not present in the web a database of triple sustainable business models that are sharing their work and their knowledge in order to facilitate new entrance, even if they are willing to do it. Each organization has different approaches to the sustainability. The approach may be influenced by the geographical areas and the cultures. Different business models stress different aspects of sustainability. Some examples are: minimizing the waste, inserting circular economies, maximizing the usage of resources and so on. As a result, organisations can be sustainable in many different ways. On the other hand there are not clear instructions on how to be sustainable. Each organization has its values and ideas on how it contributes to sustainability. Furthermore, every organizations claim to be sustainable referring to several and different parameters or guidelines. There is not an official evaluation scale that can be applied in the food industry in order to assure and to claim an objective sustainability level.

1.3 Purpose The purpose of this research is to investigate Sustainable Organizations (SO) which have in common the aim to increase the availability of sustainable food products for consumers. Our aim is to map the different Business Models‟ (BM) strategies belonging to different geographical clusters (I.e. Nordic and Latin European) with special attention on evaluate their triple sustainable. The scope of mapping them is to help the new entrants to choose the right BM, providing them with information, specific examples and different instances on sustainability. This should lead to increase the number of SO therefore the availability and consumption of sustainable food.

1.4 Research Questions In order to be able to fulfil the purpose, we develop a main research question. It is: ⇒How do different sustainable business models respond in the Nordic and Latin European Cluster? To answer this question, we need to understand:

1. How different business models are triple sustainable? (SQ1) This is our first sub-question. In order to reply to this, we need to investigate on how it is possible to evaluate and to map the triple sustainability. Moreover, we research on the similarities and differences in the BMs. This in order to see


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how (and if) the two geographical areas affect the BMs In the Chapter 2, we report the existing literature we used for answering these questions and for performing our analysis. In Chapter 3, we describe the methods we used in order to scientifically reply to these questions.

1.5 Delimitations We present the limitations of our research.

● The study is focused on the business model's analysis of just small and medium food producers.

● The changes consumers‟ demand are indeed just in quality, not in quantity. ● The study is limited by availability of time of five months. ● The scientific information about food characteristics had not been verified by official

documents. ● This study has been conducted within a very specific context; thus it has a low degree

of generalizability. However, we provide information, highly descriptive analysis which can be partly transferred in similar context.

1.6 Master’s thesis Framework We are two students of KTH- Kungliga Tekniska Hogskolan finishing our Master in “Industrial Management Engineering”. We are performing this research project as our Master Thesis. This project is in collaboration with UPV- Universitat Politècnica de València. Professor Jose P. Garcia (professor of Business Management in UPV) offers us this research topic. He aims to create a database of sustainable small and medium organization‟s business models in order to ease the creation of new similar organizations, which help the flow of sustainable food from small/ medium producers to the consumer.


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Chapter 2: Literature In this Chapter we present the literature study (so previous researches) around our topic. We start describing briefly what a business model is, then we present our geographical clusters. These two elements together form the background of our research. Consequently we link these two clusters with some food habits. Finally we deeply present the sustainability issue and the short food supply chain, which can be considered a part of the broader sustainability aspect.

2.1 Business model There is a lot of research about what a business model is and how it is used. We now aim just to present what it is and why it is important. A business model has a double aspect. From one side, it describes the business (“descriptive function”); and from the other side, it calculates the economic value of an organization (“numerical function”) (Magretta, 2002). To present a business model, we can break it down in two main elements. One is called “value proposition”, the other one is called “operating model”. Both of them are composed by three different sub-elements. The value proposition highlights the customer's side; i.e. the people that the model is targeting, with services or products. Clients and products together define the revenue model. The operating model, instead, expresses how the organization is delivering the offer. It is oriented towards the organization's resources. Thus, the main focus is on how to operate in order to be profitable. The company operates in a supply chain. Many researchers have then drawn their own business model‟s definition. A definition, given by Osterwalder & Pigneur (2005), states that a business model is “a conceptual tool that contains a set of elements, concepts and their relationships, in order to express the essence and the logic of a business. Therefore, it should be taken into account that the elements and their relationships allow a simplified description and representation on, what value is provided to customers, how it is done and with what financial implications ". The components (mentioned in the previous definition) are four. These four blocks are: products, relationships with clients, operational structures and finance. They are then subdivided in elements. In total a business model has nine elements.

Concept Element Definition

Product Value proposition It is the general overview of products and services that a company is offering

Relationships with clients

Targeted market The market segment that a company aims to reach.


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Sales channels How a company reach the clients.

Relationships The types of links that a company develops with its segmented clients

Operation system

Activities and resources How the activities and resources are allocated.

Skills and competences The needed capabilities to carry out company‟s operations.

Stakeholder‟s network The cooperation with other companies in order to be able to offer and commercialize company‟s offered products/services.

Finance Cost structure The consequences of exploiting the assets.

Revenue model The company‟s model to generate earnings.

Table 2.1: the nine elements of the business model We decided to follow the framework propose by Osterwalder´s (2005), the same followed by Ana Galeano (2013) in her research on BMs. The peculiarity of this method is that the BM's elements are described from an academic point of view, therefore suitable for a more reliable and valid research. We chose to use Osterwalder's framework (to analyse the nine elements) because it fits our scientific needs. For instance, Canvas business model, which is the best known framework, works very well from a business point of view. We, instead, are interested in a clear and easy way to read model for an analysis of case study. This explains why we chose Osterwalder´s (2005) framework instead. The nine elements are present also in the Canvas‟ BM but the difference is how they are described. Taking into consideration these nine elements, we analysed different business models. In Chapter 4, you can read the described BM's elements, results of our investigation.

2.2 Cross-national clusters Since our study is based on “How do different sustainable business models respond in the Nordic and Latin European Cluster?” (RQ), we need to define the two different geographical areas. We need to define the clusters we take into consideration understanding and


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highlighting their differences. Here we start presenting the cluster we chose and the previous literature and researches.

2.2.1 National culture and cross-national clusters Many nations are multicultural, whereas many cultures are multinational. Prior researches (Ronen & Shenkar, 1985) demonstrated the existence of country clusters which report similar values and beliefs (i.e. culture). These similarities come from similar history, geography, language and religion.

Many studies and researches have been conducted to identify the country clusters. Ronen & Shenkar, (1985), represent a pillar in this research field. In their research “Clustering Countries on Attitudinal Dimensions: A Review and Synthesis”, they collected and analysed previous researches on the topic. It emerged that there are nine macro cultural clusters which divide the world.

As stated before, these macro-regions have very similar language‟s roots, religion history and geography (and climate) very similar.

Source

Haire Ghiselli, Porter (1966)

Sirota & Greenwood (1971)

Romen & Kraut (1977); SSA of Sirota & Greenwood (1971)

Hofstede (1976)

Ronen & Kraut (1977);

Griffeth,Hom,Denisi & Kirchner (1989)

Hofstede (1980)

Anglo

UK US

UK US Australia Canada India New Zeland South Africa Austria Switzerland

UK US Australia Canada India New Zeland South Africa

UK US Sweden

UK Ireland South Africa Israel

UK Canada

UK US Australia Canada Ireland New Zeland South Africa

Germanic

Austria Germany Switzerland



Austria Denmark Finland Germany Norway Sweden Switzerland

Austria Germany Istrael Switzerland

Nordic

Denmark Germany Norway Sweden

Denmark Finland Norway


Denmark Norway

Denmark Finland Norway Sweden

Denmark Finland Norway Sweden Netherland


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Table 2.2 summarises the findings.

Table 2.2 "Clustering Countries on Attitudinal Dimensions: A Review and Synthesis” source. Own Elaboration: the Arabic Cluster has been the only one removed. As far as the researches Badawy 1979 and Redding (1976).

Beside “Anglo-American” cluster, all the other clusters group countries are form the same area/continent. This exception may be due to colonization and migration phenomena (Ronen & Shenkar, 1985). Language is another aspect underlying the cluster‟s groups. Countries within the same cluster speak the same language or share the same language‟s root.

The technological development affects managerial style and attitudes (Webber, 1969). This is important to take into consideration for the analysis of different BMs. (See: Chapter 5.3 “The Business Model Characteristics in different cluestes”).

Moreover, the national culture influences the nature of the relationship of an organization

s

Latin European

Belgium France Italy Spain

Belgium France

Belgium France

Brazil France Italy Switzerland

Belgium France

Belgium Greece Italy Netherlands Portugal Spain

Argentina Belgium Brazil Frace Italy Spain

Latin American

Argentina Chile India

Argentina Chile Colombia Mexico Peru

Argentina Chile Colombia Mexico Peru Venezuela

Chile Colombia Mexico Peru Portugal Venezuela

Near East

Greece Iran Turchey Yugoslavia

Far East

Hong Kong India Pachistan Philippines Singapore Taiwan Thailand

Independents

Japan Brazil Germany Isreael Japan Sweden Venezuela

Brazil Israel Japan Sweden

India Iran Japan

Japan


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with its environment as well as relationships among people within an organization (Schneider, 1989). That explains why it is important to identify the similar cross-national culture. Culture also shapes the consumers' requirements for the food industry.

Given the framework of our research project (in collaboration with the Polytechnic of Valencia), we decided to chose the Nordic and Latin European‟s clusters.

Based on the previously reported literature review, we define the Nordic cluster composed by: Denmark, Norway, Finland and Sweden. Meanwhile, the Latin European cluster is made up by Belgium, France, Italy and Spain.

Cluster Country

Nordic

Norway

Sweden

Denmark

Finland

Latin European

Italy

Spain

Belgium

France

Table 2.3: the two geographical clusters.

See Appendix A: Justification of the clusters for reading the reasons and justification of our choices.

In the Chapter 5 Analysis, we determined the differences and similarities of the BMs in different clusters.

2.2.2 Food Quality related to the two clusters We are now going to briefly introduce the concept of “quality of food” and its characteristics. Afterwards we present the different consumer's perception of food quality in


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the two different clusters. We decided to introduce it here for clarifying our “quality” point of view for the whole research project and introduce consumers requirements and needs. Quality of food Food quality has different definitions depending on which lens this concept is analysed with. There are usually three typical actors who define the “quality of food”. They are: producers, clients and government official (Lien, 1989). Each of these major players has its own characteristic to define the quality of the product. For producers, for instance, the quality is related to technical use-attributes (yield, sustainability for mechanical harvesting and industrial preparation, resistance against insects and diseases) (Nilsson, 1978). For government, instead, the quality is higher related with regulations concerning health and production aspects (for instance allowed a determinate quantity of chemical products, additives, and so on). As far as the third point of view, the clients‟ one, the quality reflects the level of satisfaction required by them. Once, clients were more careful to the esthetical appearance (shape, size, colour, freshness, and so on). In the last years, trends show that clients are focusing also on other aspects not related with appearance (Smith, 1991; Jussaume & Judson, 1992; Schafer et al., 1993; Wandel, 1994). Clients attention is moving closer to government official‟s aspects. Thus, consumers are becoming more careful about food‟s productions, hygienic standards and environmental impact. So “high quality products” come from the combination of different characteristics both from the product itself and from subjective values perceptions (Migliore, 2015). This trend shows the shift of attention towards the processes within the whole supply chain rather than the product itself. The actual supply chain is not perfectly responding to the client‟s new needs. It may be valuable for food producers to seek for other information and distribution channels which hit better client‟s new priorities (Wandel, Bugge, 1997). This is what the Short Food Supply Chain (SFSC) aims to leverage. They want to better meet consumer‟s new needs in order to create trust and loyalty between them and producers. The quality in SFSC is not assured by a certification system but through a set of values, relationships and behaviours of clients and producers. Indeed, often food quality is associated with special economy where there is a strong presence of environmental, social, ethical, political, personal health and cultural issues. This leads to the binomial local-natural to be a requirement for quality food products (Migliore, 2015). This research takes into consideration consumers' point of view. Therefore, when we refer to “high quality food”, we mean the low environmental impact, high hygienic standards and high nutritional values (i.e. healthy food). We now report some already carried out researches on what consumers are mostly seeking in the food.


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Quality of food for consumers in different clusters There are more and more researchers about alimentary habits. The researchers aim to explain by what and how the alimentary habits are affected by. To analyse how different BMs are triple sustainable and thus how the sustainability is taken into consideration in two different clusters, we now present previous researches on what people are seeking in the sustainability within the food industry (SQ1). This is also to investigate how different geographical areas affect the organization’s offerings and operations (RQ). Starting from the Nordic Countries, there is a hanging trend in nutritional habits. The trend is pushing forward a healthier diet (less sugar and increase the consumption of fresh and natural product such as organic fruit and vegetables, for instance) (Nilsen, Krokstad, Lingaas, Westin, 2009). Some researches try to explain the underlying forces of this new trends. There is a major trend on high consumption of organic food1 (this due to selfish reasons) (Magnusson, Arvola, Hursti, Åberg, Sjödén, 2003) (Wandel, Bugge, 1997) (Tregear, Dent, McGregor, 1994). The table 2.4 summarises the three main reasons why consumers prefer organic food in the Nordic clusters. Therefore, what consumers are seeking and taking care of in the consumption of food.

Number Characteristic

1 Internal Food quality characteristic - absence or low presence of additives, preservatives and residues

2 Environmental Aspect

3 How food has been processed

Table 2.4: Consumers´ requirements in the Nordic Cluster Many researchers agree on the fact that the first reason is for personal health (organic food is perceived as healthier); the second reason in order of importance is for environmental issues (Wandel, Bugge, 1997) (Tregear, Dent, McGregor, 1994) (Grankvist, Biel, 2001). The organic food is also perceived as more environmentally friendly. This last concern is reflected also in meat purchasing decision. Consumers agree on paying a price premium (up to 10%) for purchasing meat which has had a production process that was respectful of animal welfare (Wandel, Bugge, 1997). The most notable results find that the purchase decision is based on the food production ( low

1A product for being classified as “organic” needs to meet several requirements on both the product itself and the production system. On the product level, a requirement is that the nocive chemical residue on the product needs to be lower of a determinate maximum level. On the production level, it determinates certain practices and usage of natural product or mechanical procedures in order to have a low chemical residue level on the product and on the land.


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presence of additives, preservatives, and so on) (Land, 1998 and Torjusen et al., 2001). As far as the future trends, it is likely that the organic food sales will keep on increasing because young people are more affected by organic labelled food (Magnusson, Arvola, Hursti, Åberg, Sjödén, 2003). Also in the Latin European countries, the food consumption has shifted toward a more sustainable consumption. An increase in the attention of food information has been registered in order to respond to consumers‟ concerns about safety of food, human health and environment protection (Garcia, Magistris, 2008). The main reasons are self egoistic benefits. Consumers are more careful about the health (food‟s nutritional value and characteristics). Then, they also take into consideration the environment. However, in the Latin European Countries, consumers value the relationship between food and environment rather than the way of processing food. Therefore the “local” aspect of food is taken into high consideration in these countries (Garcia, Magistris, 2008). (See Chapter 2.5“local Food”). Partly as a consequence, consumers are willing to know the “history” of the food (how and where it has been processed).They want to be responsible consumers. Table 2.5 summarizes the results for the Latin European Cluster.

Number Characteristic

1 Internal Food quality characteristic - absence or low presence of additives, preservatives and residues

2 Environmental Aspect

3 Knowledge

Table 2.5: Consumers´ requirements in the Latin European Cluster We have now generally presented the new trends for the two clusters. In Chapter 5, we analyse the consequences of this.

2.3 Sustainable food It is hard to define what “sustainable food” is. This is due to several used definitions. There is a broad literature about this topic. We now aim to introduce the topic dealing with the most important aspects. Starting by analysing the meaning of sustainability in accordance with the Brundtland Commission, FN, 1987 “Sustainability” is the “development that meets the needs of the present without compromising the ability of future generations to meet their own needs." Another definition, given by Sandhu (2014), is a statement which declares: "it is our

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responsibility, as consumers, to make the decisions to live in a way that does not use our resources at an higher rate than they are regenerated". Both definitions highlight that it is important to leave -to the future- the possibilities to use natural resources. Sustainability is also analysed based on the base of its geographical range of impact. Based on this distinction, we have local or global sustainability (Sandhu, 2014). The first one concerns the habits and behaviours which are sustainable in the local areas; whereas the second concerns the rate of using the global resources (i.e. the rate of using them needs to be lower than the rate of regeneration). Anyway, there are some features which are common to both aspects of sustainability. Sustainability should be a collective activity (not individual). If people want to behave in a sustainable way, they need to be engaged with each other. Moreover, sustainability is a “progressive action”. It can always be extended and further developed to be continuously improved and adapted to de different scenario. The source of continuous improvement comes from self-reflexive activities. Table 2.6 reports some necessary characteristics to define what sustainability is.

Some characteristics that define sustainability are:

Sustainability is a collective activity. A sustainability initiative engage different members of the community.

Sustainability is a progressive activity. A sustainability initiative seeks to identify unsustainable practices and change them, or, to identify sustainable practices and develop or extend them.

Sustainability is a self-reflexive activity. A sustainability initiative will improve in response to a self-relative critique of current practice.

A sustainability initiative is undertaken and owned by a community or a number of co-operating communities. A community can include organizations of many different sizes and purposes.

A sustainability initiative should develop a sustainable relationship with the natural environment. That is, it should ensure that the community’s use of particular environmental resources is better than before it was implemented, and does not deplete resources at a greater rate than they can be replenished.

Human communities are part of the natural environment. Thus, a sustainability initiative should improve and sustain relationships within its own community, and with other communities. Table 2.6: Characteristics of sustainability If we link the sustainability topic with the organization‟s operations, a very relevant concept


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is the “Triple bottom line” sustainability concept of Hudson (2014). The core focuses on environmental, social and economic sustainability impacts of the different activities done by the organization. Hence, the “triple” sustainability line. It is important that these sustainable aspects are balance between them to reach an equilibrate and sustainable organization. Other authors have developed different indicators of sustainability to give some guidelines to organizations. We use them in order to develop our sustainable model. The researcher Holton (2008) has developed a list of elements which could be taken into consideration in order to develop a sustainability strategy. These elements are different depending on the sector where the business is operating. The framework aims to help organizations to integrate economic, social and environmental risk. It also aims to increase the organization competitiveness through a defined sustainable strategy. Nevertheless, we could not directly apply this framework to our case. This is because the framework is focused on sustainability strategy for brick, forest and steel construction industry. Furthermore, they do not give a measurement scale to measure and evaluate the sustainability. Anyway we mention it since we had use it to keep examples and inspiration to develop the sustainable model. Reineck (2011) considered thirty different Key Performance Indicators (KPIs) which could be taken into consideration in order to evaluate the sustainability development. Image 2.1 present the KPIs divided into their triple sustainable classification.


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Image 2.1:Reineck's 30 KPIs Each of these KPIs has a specific method for being calculated described by the author Reineck (2011). Looking at these KPIs, the organization manages to monitor if the processes are aligned with the sustainability and - in accordance to them – it manage to drive the future suitable actions. A sustainable food system is a collaborative network which integrates several components in order to enhance a community‟s environmental, economic and social well-being (Pothukuchi, 1999). We consider sustainable food all the agro-alimentary products which are produced and distributed in a sustainable way. All the aspects of sustainability (i.e.“triple bottom line”) must be taken into consideration. Therefore, sustainable food should come from a sustainable supply chain, which should be made of sustainable organizations (SO) that have an impact on all the triple sustainability parts. The integrated approach (between production and the supply chain) plays an important role. We exploited all the frameworks, definitions and concepts, mentioned above, extracting ideas and identifying the starting point for some reflections to develop our "Sustainable Model". (See Chapter 4.8 “Sustainable Model” for reading our framework about map the sustainability).

2.4 Food supply chain today In this sub chapter we present literature over the food supply chain. In detail we describe the conventional food supply chain followed by a description of the short food supply chain and its characteristics based on different prospective.

2.4.1 Conventional food supply chain today and its consequences The conventional food supply chain (CFSC), or Agri-food supply chain, is facing a lot of challenges. This is due to the nature of the handled product (food) which is usually subjected to long lead times and significant uncertainties - both in demand and in the supply side (Lowe and Preckel, 2004). These challenges are even more complex to handle when the regulations are also taken into consideration. The food industry has been highly regulated in order to create a safe system for consumers and organization's agreement. The result is that the CFSC is highly regulated and strictly hierarchical. Making decisions is a long process which involves different parties. As a consequence, the conventional food supply chain is not efficient for dealing with the fast dynamic environment. Moreover, this low flexibility makes harder to meet consumer's new requirements. The CFSC, due to the standardization to decrease costs, has favoured the presence of a few numbers of intermediaries between the producers and the consumers. The CFSC leads to: longer transportation distance; standardized products, which often need to be processed or submitted to different operations; less direct interactions or relationships between the


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producer seller and end consumers. All these CFSC facts lead to a different unsustainable effects from all the bottom line points of view (environmental, social and economical). Some example of these effects are: increasing products travel distance, using more packages for optimizing the transport of all items, standardization of the production which leads to decrease product‟s variety, using of security and safe stocks long all over the supply chain; increasing food scraps (items which had not fulfilled all standard requirements); cultural isolation of producers especially in the rural area; increasing the cost of the products due to the long supply chain, increasing economic dependency and so on. These are just some of the consequences of the CFSC. The Image 2.2 represents the actual situation of the supply chain in the agri-food sector. It shows the result of CFSC.

Image 2.2: Funnel scheme of the supply chain in the agri-food sector. Source: (Grievink, 2008) Based on data from seven Western European countries. The Image shows as well the purchasing power of the intermediaries of the CFSC. As it can be seen, there are several intermediaries and the power is not equally divided between them. There are large numbers of producers and consumers but there is a remarkable squeeze in the middle of the supply chain. This results in an hourglass structure which leads to the middle players to have a large amount of power. Moreover, it also shows as well the number of intermediaries between producers and consumers within the CFSC. Therefore, in order to better meet consumers‟ new quality requirements, a new typology of supply chain is needed. Technological development, e-commerce, and so on allow the development of a new type of supply chain: the Short Food Supply Chain - SFSC- or network supply chain. With our project we aim to contribute to analyse different BMs which are possible to reproduce and which are operating with the SFSC (so they aim to eliminate the majority of the intermediaries: semi-manufactured, supplier, buying desks, banners, supermarkets and shoppers). So, we also aim to provide tools for entrepreneurs to enlarge the hourglass of the


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supply chain of the agri-food sector.

2.4.2 Short Food Supply Chain definition. This paragraph introduces the definition of Short food supply chain (SFSC) and it gives a brief description of the critical points of SFSC concept from different prospective. Due to the main reasons stated above, this unsustainable CFSC offers possibilities to develop a new more sustainable supply chain. Therefore, the “alternative food chains” (or network) has attracted a lot of attention in the recent years. New food politics began to fill the gaps between old government regulations and consumers‟ concerns over food and its manipulation (Marsden T., Banks J., Bristow G., 2000). Consumers are seeking for more natural and local food (see Chapter 3.2.2 “Food quality” and 3.5 “Local food”). They agree on paying a premium price for having higher quality, traceability and natural production process on food. It is important that the product reaches the market embedded with its information (Marsden T., Banks J., Bristow G., 2000). This upsets the previous “non” existing relationships between the producer and the consumers (Thvenot, 1998). The concept of a food supply chain which increases the consumption of local and sustainable food is identified with different names Short Food Supply Chain (SFSC) and Agri-food Network (AFN). The SFSC concept is more specific than AFNs, and, rather, covers the interrelations between the actors who are directly involved in the production, processing, distribution, and consumption of food products (Renting, 2002). That is why in this paper we focus more on SFSC rather than AFN. SFSC have a double aspect to consider. Firstly, they redefine the producer-consumer relationship by giving clear signal of the origin of the food products; secondly, they refer to the rural economic development that the countryside is living nowadays (Marsden T., Banks J., Bristow G., 2000). Canfora (2016) has defined the SFSC as capable “to reach the goals of sustainable agriculture, through the reduction of transportation costs and consequently of CO2 emissions. In addition, it promotes biodiversity and implements peri-urban agriculture”. This definition comes from the legal definition, Regulation 1305/13, providing the Rural development policy scheme 2014-20, art 2 §. 1, m (Canfora, 2016), of short supply chain which is defined as: “a supply chain which involves a limited number of economic operators, that are committed to co-operation, local economic development, and close geographical and social relations between producers, processors and consumers”. Two authors Renting (2003) and Petit (2010) simplified the definition declaring that the models of short supply chain are local distribution systems where intermediaries, between consumers and producers, are reduced. These models have always existed; but nowadays, eliminating intermediaries bring a series of advantages and they can assure producer‟s revenues.


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There are two types of short supply chains: Short circuit, where products are sold through one intermediate; and direct sales, where the products are sold directly by the producers to the end consumer (Maelle, 2015). Every organization, which operates within the SFSC, has its own view of the main characteristics needed by a SFSC. However, Galli (2013), Coley (2009) and Hogan & Thorpe (2009) stated the two main criteria needed to define SFSCs. They are physical and social proximity. The first one refers to the transportation distance from the place of production (or the place of provenience of the material used for the production) to the place of sale (Coley 2009). An optimal physical proximity distance is difficult to identify due to cultural and regional diversity. The second concept (i.e. social proximity) refers to the number of intermediaries between producers and consumers. Usually it is zero, but two intermediaries maximum are allowed as well. Social proximity implies the construction of a direct channel of communication between producers and consumers (Marsden, 2000). This is an important aspect to take into consideration since reducing the number of intermediaries between producers and consumers has been also a strategy for supermarkets to straight their power (Sevilla, 2012). The strategy used by supermarkets could not be considered as a SFSC since it does not lead to a better relationship or better conditions for consumers or producers. Although the number of intermediaries is important, it should not be the main focus of social proximity. Instead intangible aspects such as direct relationships, trust, acknowledgement, flow of information balance of power between actors, ethics and value should have a higher weight (Galli, 2013). The physical proximity is easier to be objectively measured; meanwhile the social proximities (trust, loyalty, awareness, and so on) are more complicated to be measured. Due to the difficulty of giving an objective description and of objectively measuring every aspect taken into consideration, there is not a generic universally accepted definition of SFSC. Nevertheless, there are some common keys and general features to all the definition and concept previous presented. First, they introduce new relationships between associations and institutionalizations. This is the key core of the SFSC. It is reflected in (secondly) leveraging face-to-face relationship (the social proximity). Third, SFSC do not share the bulk food commodities (mass food distribution). Fourth, they have regulatory exception and special relationships with state regulations. Fifth, SFSCs are based on new experiment and innovation, often natural qualities and regional values are linked with the food production and SC. Sixth, the power is more equally split for producers and consumers over all the supply chain that are often active players.

2.4.3 Different perspectives on SFSC In this section we isolate and analyse the effects and consequences of SFSCs. First we


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present different perspectives which influence the SFSC - legislative, organizational and social- then we discuss the tripe sustainability within SFSC. However, SFSC is a complex interrelated system, thus, it is difficult to isolate the three sustainable aspects (social, economical and environmental). Under a legislative perspective, communities (EU) and nations are encouraging organizations and economies to operate on SFSC. They believe SFSC helps to reach environmental and social goals, as well as the maintenance and the development of rural areas. These incentives are obtained through regulations and legislations which help to improve economic performance of the organizations. Some examples of the legislations, in this direction are: labelling scheme regulations on local product and local farming (Santini, Gomez y Paloma, 2013), more flexibility on the rules, the development of special rules for local markets which help small business (Canfora, 2016), as well as, the presence of multiple financial incentives. These evidences show the growing interest on SFSC and their growing presence. Regulation is moving towards free movement of goods for local markets dimension (Marsden T., Banks J., Bristow G., 2000). From a social perspective SFSC has claimed to have different impacts on the communities. During Crock 2.0 (which was a EU Conference on rural development), the attention was on the link between rural and urban development. Another aspect is the ideological, ethical and sustainable intrinsic values of SFSC, form organizations which are motivating consumers, producers and people in organization to be active part of SFSC. SFSCs contribute to the equity and fairness among actors that are operating in the chain. Producers and consumers become equal and active owners of the food chain with an equal power. They organize and control the food chain by establishing their own rules and by increasing interaction between the members of the same community. This developed and stressed networks, enhanced knowledge and increased social cohesion. Common social concepts associated to SFSC are: trust; fairness in relation with price and ethical recognition; solidarity; shared values; motivational aspect; power equality; cultural identity; sensibilization; cohesion (Galli, 2013) In some types of SFSC (i.e. "direct sell"), where there is a direct relationship between producers/farmers and consumers, personal interactions generate obligations and responsibilities among parties. This leads to establish also a sense of morality and relationships based on trust (Migliori, 2015). Moreover, it increases the awareness and knowledge of consumers regarding production and products. These facts help the local development of communities by increasing social relations among people. It also increases the presence of local workplace and people's awareness on food, production, sustainability issue and work efforts. All together these aspects contribute to the rural development phenomenon (i.e. territorial revitalization) (Migliori, 2015). The form a study of Migliori (2015), conducted in the south part of Italy, shows that the perception of the quality, that strongly influences the purchase decision, is affected by


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informal criteria. These are the perceived needs of protect and preserve: the environment, the society relations, traditions/heritage, agricultural activities, local products and empowerment in rural area. This has been showed as well by the facts that reliability and reputation of the producers have a stronger impact on consumer behaviours than recognition of organic certifications. The implementation of SFSC has some direct and indirect environmental sustainability aspects that should be considered. Direct aspects are connected with organization of the SFSC. The sustainability is reached through local interactions and synergies between producers and consumers. Here, we give some evidences of how the SFSCs directly increase environmental sustainability. For instance, they minimize of the packaging of the products. This is because products do not need a special packaging for the transport, nor to stay in a good shape overtime, in fact are designed to be consumed pretty soon. Physical proximity (between production and consumption) generally reduces the transportation impact “Food miles” often connected with the concept of CO2. SFSC does not require a standard shape. Moreover, there are less intermediaries of retails and productions which decrease the food waste (because product do not need to fulfil different requirement). Due to the elimination of the majority of the intermediaries, the length of time from the harvest/pick up to the sell is decreased. It enhances the quality, the freshness of the products and the dependence from seasonality. This leads to: less use of chemical treatment, less processing, packaging and store energies (Edwards-Jones G, 2010). Furthermore, the consumption and the production of local and seasonal products lead to the conservation of local traditional products, biodiversity and conservation of autochthonous species. Now we present some indirect consequences of SFSC which make it more environmentally sustainable. The direct contact between the actors operating in SFSC and their feeling of responsibility increases the awareness and knowledge. This can lead to less waste at the house level, sensitise citizen to move towards a more “green lifestyle” and increase of environmental practices. Caused by intrinsic value of SFSC‟s participants is very likely that the products are organic or with similar sustainable characteristics (O‟Hara, 2011). Overall, we state that friendly environmentally practices are all over the SFSC. This is due to their nature and the ecological awareness of the people involved in the process. The SFSC has multiple economic impacts: in the organizations and in the economy of the local territory. The organizations adapting to SFSC, are usually medium and small producers who are often less competitive in the conventional market due to economies of scale. This is because they have difficulties in reaching consistency in they supply capacity in terms of quality (safety),


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quantity and continuity (Galli, 2013). When one or more producers face these disadvantageous conditions, they create collective initiatives and organizations to shorten and strengthen the supply chain (Schermer, 2006). In this way they create a SFSC. The dominant organizational forms are: street or farm markets (more traditional) or more innovative models like automatic food distribution, web platform, e-commerce collective selling/buy points (Maelle, 2015). Consumers are directly engaged. This leads to lower variation in demand which increases the efficiency of food and which decreases the reduction of food-waste (Brunoir, 2011 and Lamine, 2005). As Galli (2013) state SFSCs contribute to: the creation of local jobs; alternative forms of income for producers; increase of producers‟ economical independence; local circulation of capital; new economic opportunities for local entrepreneurs. Moreover, they contribute to: the redistribution of economic power; the shift of the economic power from the conventional intermediaries, to different dislocated small intermediaries. SFSC have also lower overhead costs, due to are based on collaboration and they give more independence to the producers in terms of production and marketing decision (Wittman, 2012). This last point carries out a change in the economy as well, for example product sold within SFSC can reach the consumer with a similar price as the CFSC. Lastly if the intermediaries have more competition they have less power, which leads to higher decisional power for producers and consumers.

2.4.4 Characteristics of the SFSC Roots of differences between SFSC, are originated since the beginning of the organizations. Some SFSC are born thanks to an individualistic entrepreneurialism; meanwhile others thanks to factors more interwoven with socio-political structures. However, all of them aim to better meet consumers‟ requirements. Therefore, the “short” characteristic represents an evolution from the "conventional" supply chain. Marsden , Banks, Bristow (2000) identified four keys areas to study:

- Temporal evolution: when they are born is important. The trend moves from strong institutional banking and sense of regional identity to funding and effective support.

- Spatial evolution: the expansion of the demand of some product out of the region. Some types of SFSC have the capacity to involve multiples farms and therefore to become central to a region agriculture.

- Demand evolution: it is strictly linked with time and space evolution. It react to market‟s new needs and new distribution channels.

- Associations and institution: networks are very important to build trust, common understanding patterns and forms of cooperation between different actors in the supply chain.


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SFSC exploit synergies on the farm through the development of economies of scope and reductions in opportunity costs need to be complemented by synergies both between farms and with the other actors in the food supply chains. SFSC require new socio-economic relationships that operate in different spatial frameworks. How new equations between space, nature, quality and product‟s value come together. Actions that create and then maintain these new synergies are strongly time and space dependent. Based on the definitions and the characteristics individuated above we classify in accordance with Marsden T., Banks J., Bristow G., (2000) and Galli (2013) three main types of SFSC. The following classification is based on the number of intermediaries, physical distance and organization type. 1- face-to-face: When a consumer buys directly from the producers. Authenticity and trust are mediated through personal interaction based on face to face basis. However, IoT (and e-commerce) are presenting new opportunities for a variant face-to-face contact through online trading and web-pages. 2- spatial proximity: products are produced and commercialized within the same region or place of production. Customer are aware of the “local” nature of the product. 3- spatially extended: where value and meaningful information regarding the production and the place of production are carried with the products until the consumer who is outside the region of production. Usually customers do not belong to the same region of the product and do not have personal experience of that. But the product has meaning laden of the region.

2.5 Local Food The world is going towards the globalization, as far as the food industry, we can see a double aspect of it. From one side, globalization of food availability, standardization of products and quality measurements. From another side we see as well an opposite trend, in which people are seeking for local and traditional food products. This is deeply connected with the phenomenon of the SFSC. In fact, they aim to provide local food. Even if it is not clear what “local food” stays for (Jones, Comfort & Hillier, 2004; Hallberg & Granvik, 2013; Eriksen, 2013). Some definitions are considering the distance that the food needs to run from where it is produced to where it is consumed. Meanwhile; other definitions consider other aspects, such as the transparency of the production process (Hallberg & Granvik, 2013). Table 2.7 reports some definitions which highlight the lack of clarity around this topic.

Organization‟s name Definition

U.S. Congress “Food, Conservation, and Energy Act"


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defines: "the total distance that a product can be transported and still be considered a “locally or regionally produced agricultural food product” is less than 400 miles [ca. 643,7 km] from its origin, or it has to remain within the State in which it is produced"

CPRE "food produced, grown and processed within 30 miles [ca. 48.3 km] of the store". This distance has also been adopted by a number of UK large retail chains.

UK National Farmers Retail and Market Association

“... a local food is consumed within 30 miles [ca. 48.3 km] from its production‟s place. These 30 miles is an ideal radius. They can be stretched from 50 [ca. 80,6 km]to 100 [ca. 160.9 km] miles for larger cities, coastal or remote regions. Its aim is to help farmers’ markets to protect their integrity”.

French ministry of agriculture, food and forestry (FMAFF)

“A commercialisation of agricultural products through direct selling or indirect selling when only one intermediary is involved”.

Table 2.7: Definitions of Local Food. Nevertheless, it is not even clear within the local concept itself. For instance, different countries have different concepts of distance. In some country, Canada for instance, “local” is considered within the same region limits (Campbell & MacRae, 2013). So this is a geopolitical definition of local. Meanwhile, other countries (Sweden, Italy and many others), evaluate the kilometres rather than the political limits. Furthermore, different organizations count the kilometres from different starting points. For instance, it can be the point of food production or the provenience place of some materials used in the production. This issue is here just introduced. We believe it is important to take it into consideration when analysing different sustainable BM. Since physical and social distance is one of the most important sustainable aspects, we need to clearly and define what it is considered as “local food”. See Chapter 4.6 for the result and 5.1 “Local Food” for reading the analysis and clarification of this concept. Next Chapter describes the methods we used in order to investigate the literature gaps we presented in this chapter.


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Chapter 3: Methodology This chapter will discuss the chosen research design and associated methods to collect empirical data. The scientific approach of the study is discussed. Then the used methods for collecting data (through literature study, interviews and write-storming) are presented. To ensure the study’s scientific quality, we present how we dealt with the scientific quality in our report to enhance validity, reliability and generalizability. In the last section, we discuss the ethics arguments related with our research work.

3.1 Scientific Approach To investigate and to map different BMs which aim to increment the sustainable food consumption, we decided to design an exploratory case study. More specifically, our aim was to compare and to contrast BM‟s differences in different geographical areas. Therefore, this research is a comparative research study (Blomkvist & Hallin, 2015). We decided a case study design since our purpose is to describe and to explain new phenomena through the problematization of the research. According to Collis and Hussey (2014), the case study is the most suitable research design for these projects. Moreover, even though there are a lot of studies about business models, supply chain and food industry in general; we did not encounter any studies that aims to compare differences and common features of different emerging sustainable organizations in relation to different selected groups. Since case studies‟ results are often the basis for discovering new dimensions, we also presented potential future researches‟ topics which aim to proceed where our topic ends. Inductive research We used an inductive method to carry out this research project. We used theories to better understand and to run the analysis of the findings. General trends have been drawn by particular instances, thus there had been an induction from observation of empirical reality to theory frameworks (Collis & Hussey, 2014).

3.2 Creating sub-questions Our aim is to analyse (and to compare) how different sustainable business models respond in different European geographical areas. In order to achieve our goal, we develop a main sub-questions (SQ). The SQ1 (“ How are different business models triple sustainable?”) is more focused on the sustainability aspect. So, it aims to define guidelines on how to be triple sustainable and to


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actually define what is food sustainability and how it can be evaluated. Meanwhile, the SQ, (“How do different sustainable business models respond in the Nordic and Latin European Cluster?”), is more focused on comparing similarities and differences on the two analysed clusters. To answer this question, we analysed different business models of developed in distant geographical areas. We especially analyse the different approaches to the sustainability issue. Now we present and discuss the methods used to collect primary and secondary data in order to answers these questions.

3.3 Data collection Method This part explains how we collected our data. To investigate and map different business models, we decided to perform interviews with people involved in the organizations we analysed. This choice has been made in order to collect qualitative data from the active people involved in the (Short) Food Supply Chain. Our studied phenomenon (i.e. business models which aim to increase the food sustainability - especially - between small and medium producers to final consumers) needs both qualitative and qualitative data. As far as the qualitative ones, they are most empirical primary sources. The quantitative ones are taken from previous researches and studies. They are mostly secondary sources. We now present in details the methods we used to collect the data presented in this research. We start describing how we perform the literature review and then we describe how we collected the primary source data.

3.3.1 Primary data We now explain how we collected our primary data. We mostly performed semi structured interviews and one write-storming.

Interviews Most of the empirical primary data have been collected through performing interviews to different stakeholders. We decided for a semi-structure interview since they let more flexibility to the interviewer (Collis & Hussey, 2014). However, one of the main drawback with this approach is that the interviews can be difficult to compare (since there is not a common shape and form) (Collis & Hussey, 2014). To solve this issue, we decided to analysed them with a thematic approach. It means we selected one theme at the time (for instance, sustainability, purchase habits, and so on..) and we collected all the relevant information around that topic. Another important drawback of this kind of interviews is the low reliability (see subchapter


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3.4.2 Reliability). Our semi-structured interviews contains both open and close questions. As far as the open questions, we just mention a topic and then the interviewee was able to freely speak about that topic. As far as the close questions, we asked further motivations or to better explain how they deal with a specific issue (for example, if the question was: “do you purchase sustainable food?”; depending on the answer, we asked additional questions to further investigate the concept. In this example, a follow up question could be: “what is for you sustainable food?”). To prepare the questions, we drawn the general topic that we wanted to discuss during the interviews. Then, we developed suitable questions around these topics that were leading us to understand all the components of the general topics. During the interview itself, follow-up questions were always welcomed.

Interview’s characteristics We performed most of the interviews in English. This choice has been made because English is the project‟s official language. However, some of the interviews were also performed in the mother tongue of the interviewee (Italian, or Spanish). This was decided in order to have a better communication when the other person could not be fluent in English. At the beginning, we asked if it was possible to record the interview (in order to transcribe it and not to lose any information). All our interviewees agreed on registering the interview. Furthermore, the questions were distributed in advance, to provide a possibility for them to be prepare and (if needed) to ask the authorization to their organization. To decrease the biases‟ risk, we briefly introduced the topic and purpose of the research. This also increase the validity (Collis & Hussey, 2014). We now present the two interview´s templates we developed. We developed two different templates for better meeting our interviewee´ knowledge. One is for the sustainable organizations and the other one is for the experts in the food industry.

x Semi-structured interview for expert in the field. We interviewed some experts of the food industry. In these occasions, we developed ad hoc semi-structured interviews. This choice had been made in order to exploit their whole knowledge about their experience. Table 3.1 shows the main topics of the semi-structured interviews.

Phase Why

Beginning Briefly introduction of the project to enhance the validity.

Warm-up phase Building trust and better knowing the interviewer. In this phase we usually asked


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our interviewee their main tasks in the organization and how they end up there.

Sustainability

How they deal with the sustainability. What the main challenges are and what their main focus aspects are.

Business model analysis The main features of their business‟ value offering.

Short Food Supply Chain - SFSC

Concrete example of SFSC. Main features and challenges.

*Suited part* *For each expert we tailored part of the interview*

Conclusion recapitulating and thanking for the time

Table 3.1: structure of semi-structured interviews for the expert we interviewed. Before concluding the interview, we briefly summed up all the information of the touched topics and we asked if they wanted to add something. At the very end we were grateful for the time they decided to dedicate to us and to our research. Table 3.2 reports the expert we interviewed.

Business Interviewee Purpose of business Date

Member of “Stockholm Food Tech” Federico Ronca Project Manager of Tim

Incubator. 09/03/2017

MatLust Helena Nordlund

Matlust is a EU Project to improve the food production for small and Medium producers to end customers.

20/04/2017

Table 3.2: interviewed expert in the food industry - primary sources. x Semi-structured interview for the Sustainable Organization

We perform some interviews to Sustainable Organization (SOs) to collect quality data on their business and activities. These interviews had been divided in two part. See the Table 3.3.

Phase Topic


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Phase I

Background Building trust and better knowing the interviewer. In this phase we usually asked our interviewee their main tasks in the organization and how they end up there.

Analysis of Business Model Value proposition, Clients, Revenues, Resources and Assets, Costs, Processes and Activities, Suppliers, Financing and Criticisms

Phase II

Local Food ----

Digital Transformation ----

Sustainability ----

Table 3.3: Interview template for sustainable organization Table 3.4 reports the interviewed to the people involved on the sustainable organization.

Business People - responsible Purpose of business Date

Grisoxen Merkel Cullis Traceability of meat. Delivery just high quality maet.

31/03/2017

Agrozero Biella Michele di Biase To increase the consumption of local food.

17/03/2017

L‟alveare che dice si

Paolo Nosenzo A sturt-up that create an alternative to the model of the supermarket.

21/03/2017

El Colletero Raquel Ramirez Association of territorial revitalization.

20/03/2017

CowFunding Gertjan Dieleman Traceability of meat. Delivery just high

29/03/2017


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quality meet.

Trampolin Solidario

Lupe Martín Social inclusion and production of sustainable food and offered services.

28/032017

Värpinge Grön Gårdsbutik

Håkan Rasmusson Local triple sustainable vegetables.

09/05/2017

Table 3.4: the interviewed people belonging to the sustainable organization See Appendix B for reading the sustainable organization´s template.

Write-storming We decided to perform a write-storming technique to generate research topics by listing spontaneous ideas with more interested people (Collis & Hussey, 2014). Since there is no clear literature about food sustainability, we decided to use this method to investigate new possibilities to develop new framework. In order to come up with suitable sustainable idea we performed a write storming with six people (five researchers at UPV and a professor). Table 3.5 presents the six members of the write storming.

Name Actual Role Age From Previous studies

Jose Garcia Professor 47 Spain Industrial Engineering

Joan Morant Research student in

29 Spain Master in Informatics Engineering

- PhD- Student in - Brazil Management

Cecile Rabec Master Student in

22 France BCS in Industrial Engineering

Valentin Caru Master Student in

22 France BCS in Industrial Engineering

Nicolò Giudice Master Student 24 Italy BCS in

https://www.facebook.com/VarpingeGronGardsbutik/?ref=page_internal



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in Industrial Management

Industrial Engineering

Table 3.5: the participants of the write-storming Before performing the write-storming, we explained the main arguments of the triple sustainability: social, environmental and economical. Moreover, we decided to be limited within the agro-food field. We analysed just one argument at the time. We started when everyone was aware of the scope of the write storming and of their role in contributing with ideas. At the beginning we started to write about social sustainability. After five minutes each member was putting on the middle of the table his/her idea briefly explained, in a circular manner. Meanwhile, if someone was thinking something new, they were allowed to write it down but they needed to wait their turn to express it out loud. We repeated the same process for the other two main aspects of sustainability: environmental and economical. The whole write-storming took place in 2.30 hours. At the end Nicolò Giudice and the professors Jose P. Garcia divided and categorized all the ideas which had come up during the write storming section. We created a different group for each sustainability aspects (social, environmental and financial). Image 3.1, 3.2 and 3.3 show the post-its of the write storming. Image 3.1 categorizes all the ideas on the social aspect of sustainability. We find that in the social aspect we can have different main factors that affect community, people and society. Image 3.2 represents the ideas regarding the environment sustainability. Image 3.3 collects and categorizes all the ideas on the economic sustainability.

Image 3.1: Social Sustaniability Image 3.2: Environmental Sustainability


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Image 3.3: Economic Sustainability After that we collected and categorized all the ideas, we decided to rank each of them using a positive and negative numeric scale. The number indicates the importance and the impact of each specific aspects and actions. We chose this evaluation method since it gives objective evaluations which can be compared and analysed. See Chapter 4.8 "Sustainability Model" to read more about how we evaluate and map the sustainability.

3.3.2 Secondary source data This section explains how we collect our main secondary data. We used both databases (especially for quantitative data) and literature study (especially for theories).

Literature review Secondary data were gathered through a broad literature review. We especially used digital format of books and articles. In order to find relevant aspect of this study, we used three digital databases for scientific articles: Google Scholar, KTH Library‟s service Primo and PoliBuscador. We also used the read articles as a source for discovering other relevant papers (through their references). To answer the main RQ and its sub-questions; we drilled very broad concepts to reach a manageable unit of information. For instance, we started by reading about the Supply Chain theory, then we intersected it within the food industry and we discovered the Short Food Supply Chain (SFSC). We analysed mainly two aspects: the culture of different countries related with the different alimentation culture and the Short Food Supply Chain (SFSC). These aspects have been narrowed down and discovered during our preliminary investigation. To enhance the reliability, we present the majority of the typed keywords used for searching relevant literature. They were: Business Model, Short Food Supply Chain, Sustainable food, sustainable business model, consumer behaviours, alimentation habits, food availability,


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different habits; Consumers purchasing decision; Sustainable Organization; Sustainable parameters.

Database search The databases were used just to have a broader vision of the quantitative data. We used SCB- Statistics Sweden, especially for statistical data about the alimentation habits of the Swedish population. We need to collect and compare it with a Latin European country (i.e. Italy, Spain and France). So we mostly exploited the national statistical databases. We used some international reports for quantitative data which have their references on international databases (Organization for Economic Cooperation and Development - OECD, World Trade Organisation – WTO, the World Bank, Foodlinks).

3.3.4 Researching different sustainable organizations To know different business models, which aim to increase the availability of sustainable food from small/medium food producers to consumers, we research them in different ways. We decided to have several approaches for searching the BMs otherwise we would have been to have limited findings only (for instance, just the once with an on-line presence). First we did a broad research online using different keywords (such as: sustainable food, km0, short food supply chain, ecological food delivered at home, organic food, food producers, and so on. We also combined these keywords with geographical areas; for instance: organic food producer Stockholm). Then, some of these business models have been individuated thanks to the literature research and then verified online. The literature research had been based both on scientific articles and on public reports which explained different case studies. Some examples of these reports are: Foodlink (An Action Plan for Sustainability). Eventually, another way was performed by directly asking to people, families and friends. Having identified the Sustainable Organizations (SOs); we developed a preliminary analysis (See Appendix C: Template for preliminary BM analysis) to decide if they were fitting our standards and requirements with Jose P. Garcia. The professor helped us to individuate the BMs which needed a further investigation. This represented the first big screen. We completed this phase with 16 SOs. Since not all of them replied or showed interest in our research, we performed seven semi-structured interviews. Table 3.6 reports the organizations that we had the possibility to directly interview.

Sustainable Organization Number associate

L‟alveare che dice si 1


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Trampolin solidario 2

El Colletero 3

CowFunding 4

Grisoxen 5

Agrozero Biella 6

Värpinge Grön Gårdsbutik 7

Table 3.6: The SOs we interviewed and their reference number.

In order to enhance our findings we wanted to analyse ten SOs. Therefore, we decided to take into consideration other four SOs. They are presented in Table 3.7. Here, we decided to link a letter rather than a number to clearly distinguish this groups. The difference is that we have not performed any interviews with them. Thus, the used data has been gathered only through the web sites (content, descriptions…) and secondary sources (social media and so on).

Organization Letter

Bondens Egen Marknad

A

Karma B

Zolle C

Table 3.7: SOs which have not been interviewed and their letter of reference

3.3.5 Business Model analysis method Here we present the method that we useed to analyse the business models in accordance with the framework developed by Galeano (2013). In order to investigate different business models, we utilized the “case study” research design. This allowed us to have a systematic method of study. Image 3.4 visually explains the scheme developed by Galeano and adopted for our case.



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Image 3.4: Framework followed in our analisis. It has been developed by Galeano, but we adjusted for better meet our needs. We now describe more in details all these steps. They represent the unit of analysis for the business models.

⇒ 1. Data collection 1.1 The first step has been to collect information and data of the suitable SOs from different sources. Further we performed interviews to people responsible, or directly involved with the SO. 1.2 Secondly we individuated, extrapolated and selected the needed information.

⇒ 2. Data organization 2.1 In this step we divided and organized all the data selected in the previous phase (1.2) in each different elements of a BM. Starting with assigning a BM to a specific category, which we selected that better represent and incorporate all the different BMs that we analysed. They are: Productive Efficiency Model; Network Efficiency Model; Value Model. Moreover, we described and studied all the necessary elements to understand the business. These elements are: value proposition, clients, revenue model, resource/assets, costs, process/activities, – with their operations, supplier and financial structure. This is called “static phase” because here the elements are described and explained just within their boundary limits (i.e. they are explained just for what they are). 2.2 For each element described, we analysed its strategy. It explains how the elements (of the BM) are exploited. This is a dynamic step because it relates the element with their projection


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in the future. 2.3 We reported and collected useful information for the BM's reproducibility such as BM's criticism, initial external conditions and values.

⇒ 3. Analysis of data 3.1 In this phase we analysed information to develop and to clarify concept of SFSC and sustainability. 3.2 We used the information to perform a sustainability evaluation of the SOs. 3.3 To conclude the analysis phase, we performed a qualitative analysis of the BMs characteristics comparing the clusters and the elements of the BM.

⇒ 4. Case study reporting 4.1 The conclusions are extrapolated. Patterns, correlations and other relations are found and connected. 4.2 Finally, we presented the conclusions.

3.4 Scientific Quality The scientific quality of this research is based on three main principles (Blomkvist & Hallin, 2015). First, we followed a systematic approach which means that the project is aligned from the beginning to the end, using cause-effect links to explain concepts and analyse results. The red thread which connects all different parts of the report is focused on the problem formulation and purpose of the research. Second, we stayed impartial throughout the whole research by having a third eye perspective and a broad overview of the whole system (during both the data collection and data analysis). Third, we continuously performed critical approach on our thoughts, analysis and findings. We have been open to reflections and critical feedbacks. We pushed a lot on justify our choices also in order to have high critical thinking which leads to a higher scientific quality. There are three main concepts (validity, reliability and generalizability) which need to be further analysed when considering the quality of a scientific research. They are presented and discussed here below.

3.4.1 Validity Validity refers to what extent the studied phenomena are the right aspects to investigate for the problem formulation (Collis & Hussey, 2014). In other words, the validity assures, that what has been said, is what is needed in order to explain the RQ and the problem formulation. We used multiples sources to reach our aim (which was to analyse and compare different business models, developed in different EU geographical areas). The majority of the articles are peer-reviewed. So the validity is rather high. We also used non peer-reviewed reports created by different national and/or international institutions (for


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instance European Union, INFOAM Organic International, FoodLINK and so on…). Even though these reports have not been peer-reviewed, they bring value especially for numerical data thus quantitative information. As far as the interviews, we enhanced the validity sharing with our respondents the purpose of our study. This, according to Collis and Hussey (2014), increases the validity. Given the semi-structured interviews, the validity decreases, since interviewers have a limited field of freedom to explain themselves. In other words they are influenced and inducted form the researcher questions. However, we perform triangulation method to leave the validity rather high. The triangulation method consists in using several sources to strengthen the validity of their information. Therefore to decrease the biases (Collis & Hussey, 2014). Moreover when interviewing people, we previously asked if they wanted to be completely anonymous (and thus their name will not compare in the report) and we also asked if it was possible to record the whole interview. The validity of the research is slightly enhanced because people could freely feel to express themselves.

3.4.2 Reliability Reliability expresses to what degree the achieved results are possible to be achieved a second time performing the research with the same methods (Collis & Hussey, 2014). To assure the repeatability of the research, we had to carry out the work in the more objective way possible; it means that we had not influenced the findings. As far as the secondary sources, literature and reports, the traceability of these documents is high. Therefore, the reliability is high as well. We referenced to the used documents with the Harvard system, thus the complete list of articles can be read at the end of this report. Even though secondary data are less reliable because they depend on how we interpreted them, they just slightly affect the reliability of the whole study. The semi-structured interviews have rather low reliability. This because it is unlikely that we could have exactly the same results if we performed the interviews a second time. However, we used a simple language and we explained the complex concepts through examples in order to enhance the clarity of the questions and, as a consequence, the reliability of the research. Another aspect which affects the reliability is the traceability of data. Appendix C reports the questions and the template of the semi-structured interviews (for all the three previously mentioned groups). The last aspect to consider is the correlation between the anonymously and the reliability. They are negatively correlated because the anonymously of the participants largely decreases the repeatability of the findings (and thus the reliability). However, most of our participants were not willing to be anonymous, therefore the repeatability of the findings is enhanced. As far as the write-storming, it has very low reliability. This is due the fact that the interested people affects the results. They are supposed to bring their own ideas. As consequence, it is


50

likely that if other people are participating to the write-storming, the findings are slightly different.

3.4.3 Generalizability Generalizability expresses to what extent the research findings can be extended to other cases (Collis, Hussey, 2014). In other words, if the studied sample can be a representative for the whole category. The food industry is highly regulated by different national and international institutions. This leads to a low generalizability of our findings. However, we tried to draw general conclusions as far as the food industry. They have to be just limited in the food industry‟s new trends and applied on a system perspective. As far as the generalizability of the collected data, it is rather low. First, we were really focused on the food industry, therefore it is hard to expand our results to other industries. Secondly, even if we decided to analyse two different clusters, being it already dangerous to generalize the findings all over the cluster itself, it won‟t not possible to generalize outside the cluster. Thirdly, we interviewed SOs that have not been randomly selected. Therefore, it is hard to reach large generalizability. One of our main aims is to investigate the reproducibility of some parts of the business models in order to reproduce the sustainability aspects. This is thanks to the generalizability of some business model‟s operations. So the generalizability is an important aspect of our research which had been taken into high consideration since the beginning. On future researches, we aim to generalize our findings also in others countries. We started defining different clusters where the other interesting (and similar) results could be found (see Chapter 7.2 “Future work”).

3.5 Ethics During this research project, we maintained high attention on the ethics issue. Given the international aspect of our research, not only we complied not only with ethical codes on a national level; but also on an international one. During our data collection, we were transparent in the information regarding the project. We tried to avoid discomfort or anxiety in our interviewed or organizations. All the participants had been previously informed about the topic and purpose of this study. We also presented the background of this research project. We stated the two involved institutions: KTH - Kungliga Tekniska Högskolan; and UPV - Universitat Politècnica de València. Moreover, all the involved parties had the opportunity to be anonymous beside the assurance of confidentiality of the data. They had the possibility not only not to be associated with their answers (therefore their findings); but also to be completely anonymous (Collis & Hussey, 2014). The main consequences of these choices are discussed in the previous sub-chapters


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(see 3.4.1 Validity, 3.4.2 Reliability). Lastly, to ensure and protect all parties (interviewed people and organizations) which collaborated with us, we asked their permission to record the interview. The oral communication has been transcribed and (if asked), it has been sent back to the interviewee for being approved. In this chapter we present the methodology used in our investigation. In the next chapter (Chapter 4) we introduce the results of our investigation.


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Chapter 4: Results This chapter describes the results we achieved thanks to the collecting data processes. We report data and information that we collected during the interviews and primary data collection. Since we used several methods to collect data, we decided to structure this chapter with a thematic approach. This to facilitate the reader to get all the information of the discussed topic. We start reporting the results achieved from the Sustainable Organizations (SO) (i.e. the analysis of their business models). Specifically, we start reporting the reasons why people started their organizations, then we briefly report every element of the BMs. Once the SO has been completely described, we then shift our focus on food. Primarily about sustainable food, secondly about local food. At the end, we present other founded results. All those results are shared information and knowledge about different BMs that help new entrance to create their SO.

4.1 General description of the analysed BMs Before starting reporting the results, we believe it is important to briefly present the investigated BMs. In order to have an easier analysis and reference system for each SO we associated a number or a letter. The SOs associated with a number had been interviewed by us; meanwhile, the SOs associated with a letter had not been interviewed, therefore we based our analysis only on publicly available information for these last ones.

In the table 4.1 and 4.2 we present the general description and the associate number/letter of the selected SOs.

SO General description #

L‟alveare che dice si (Abbreviation: L'alveare)

Platform, which provides the service to an open community where the Host finds local suppliers and consumers and he is responsible to manage the local community. All the transactions are based on internet platform.

1

Trampolin solidario (Abbreviation: Trampolin)

Social organization of insertion which produces and sells organic products and sustainable services. It also provides different services and training programs to social excluded.

2

El Colletero Association that produces organic products by revitalize the territory using disable workforce. It offers a training programs and a weekly distribution of food boxes to the associated

3

CowFunding Online platform which provides high quality meat. The aim is 4


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to let the consumers knows where the meat is comes from and how it was produced.

Grisoxen Online platform which provides high quality meat. The aim is both to give the right information to the consumers and to provide right remuneration to the farmers.

5

Agrozero Biella (Abbreviation: Agrozero)

Web platform where customers can order what is available from suppliers and the organization distributes the products in the indicated location or at home.

6

Värpinge Grön Gårdsbutik (Abbreviation: Värpinge)

It is a “Social Organization, it grows vegetables and crops” and offer Golf yard. Consumers can suggest what the organization should grow. Moreover it provide training courses and golf courses. One of the main aims is to provide jobs to socially excluded people through the revitalization of some territories.

7

Table 4.1: Sustainable Organization’s description and number.

Organization General description Letter

Bondens Egen Marknad (Abbreviation: Bondens)

It is a collaboration between Swedish food producers. From this collaboration, they join their selling forces. They directly sell their products to consumers in different markets, which are 22 in the whole Sweden. It works only from May to September.

A

Karma Start-up which aims to decrease the food waste of business activities. Restaurant, bakeries and so on, upload, to an online platform (which is provided by Karma) their leftovers. The users receive notifications and they can buy the desired quantity (through the app) with great discount.

B

Zolle Company, which is working with the delivery of prepared food boxes. Their supplier are regional producers of high quality foods.

C




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Table 4.2: Sustainable Organization's description and letter.

Since our purpose is to investigate how different small and medium organizations in the food industry can be triple sustainable, in table 4.3 we present each organization's dimension: both geographical potential and in the number of people who are working in it.

This in order to inform a possible reader, who is interested to open a sustainable organization, about all the different possibilities and external characteristics that we identify across our study.

The last column expresses the dimension of the organization. “S” stands for “small” and “M” means "medium" (See Definition p. 2 to read how we define a small or medium organizations).

# BM Territory description People involved Size

1 L‟alveare The platform operates in Europe. The host operates in a local community (village, quarter).

The international organization has 50 employees. The Italian section has 7 employees. In Italy there are 100 hosts (collaborators), 40 hosts working weekly. The host operating in the community usually is one person.

M

2 Trampolin It operates in the Canary islands. They cover a surface of 7 493 km2 with a population of 2 117 519 inhabitants plus all the tourists who are approximately 9 to13 million per years.

It has 30 employees. Compressive of integrated excluded and specialized.

M

3 El Colletero Municipality of Nalda. The territory is about 24,6 km2 with a population of 1000 people.

There are 4 fix employees and more than 30 volunteers

S

4 CowFunding It delivers products in two different regions: Stockholm and Skåne -South West- areas.

One full time employee, 1 farmer who has a main role in the organization as well. Total team of 5 people.

S


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5 Grisoxen It delivers products in Stockholm area have a population of 2 226 795 in the whole area of 6 519 km2

A team of 4 people but all the employees have a job on the side.

S

6 Agrozero Municipality 46 69 km and a population of 44 599

1 employee. 8 suppliers and 400 end customers.

S

7 Värpinge Close to Lund (80 000 inhabitants). The city is 25,75 km2

3 employees, 9 volunteers S

A Bondens Organization working on a national level but it has been divided up in different local community in different regions.

suppliers & members: 500 farms.

M

B Karma Operating just in Stockholm city. The population is 935 619 covering an area of 188 km2

11 employees S

C Zolle Municipality of Rome 1 285 km and a population of 4 353 775

30 employees M


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Table 4.3: Double dimension for each BM. We decided to separate the number of employees of the organization from the number of volunteers. This decision has been taken because the volunteers are not full-time involved in the organization. Therefore, they need to have a different weigh when it comes to calculate the numbers of people working in the organization. The figures about inhabitants and km2 are taken from Wikipedia website and are usually figures from the 2016.

4.2 Initial condition to start the BM Our purpose is also to investigate what different existing BMs have in common, we analyse every sub part of each BM to see similarities. We now start from the beginning of the SO; thus, why they start the business. Since different BMs stress different aspects, they have different strategies. We report the results on how and why they started the business.

These BMs start for different reasons. In general, they are based on strong principles and motivations which start from the founder. These organizations are often claimed to be “very idealistic” (Nordlund, 2017). He or She usually has an entrepreneurial spirit. The values and motivations (which the BM is based on) are the most important motivational characteristics, since they need to be shared by all the stockholders. This makes these sustainable organizations quite idealistic oriented rather than business oriented.

These SOs often born from an initial network of friends. They believe in the same values, which then become then the base of the BM. At the beginning they are willing to collaborate with each other in order to help the kick-off of the organization (1, 2, 3, 5, C).

The spark of the organization is often the unbalance between financial, social and environmental sustainability. For example, Trampolin (2), El Colletero (3) and Värpinge (7) saw a lack of social sustainable employment and an unsustainable use of the environmental resources. The unbalance was created by: improper use of external resources, exploitation of short term contracts and CFSC. Trampolin (2), El Colletero (3) were founded by an women association which had the initiative of helping the territory.

Some of the organizations are born with the aim to reduce the number of intermediaries between producers and consumers and to work with local products (1, 3, 4, 5, 7). The main idea of all these organizations is to boost social sustainability eliminating the intermediaries. Nevertheless, just two of them (3, 7) do not have any intermediaries. The majority of SO represents an intermediary themselves between producers and consumers (1, 2, 4, 5, 6, A, C, D). (See Chapter 5.3 “The Short Food Supply Chain”).


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The initiatives, which start as volunteer work, are carried out both from the founder and from who believe in the same values and principles. They are usually really committed to build their sustainable organization besides they work (1, 2, 3, 5, 7, C). The major kick-off engines are: willingness of more transparent information, shorter relationships between producers and consumers and more sustainable healthy products requested by consumers (1, 3, 4, 6, 7). In some cases, they start with the creation of an association of producers, consumers or volunteers (2, 3). When the association is not the case, most probably, there are external investors who sponsor the workers at the beginning (1, 4, 6).

4.3 Fundamental value of the organization In the previous paragraph, we mentioned some base values shared by all the stakeholders. These organizations leverage different principles and values (reported below). We now present the main values leveraged by the organizations. We present these results dividing them according to the triple sustainability theory. So we divided them according to the economic, social or environmental perspective. This also to be able to answer our SQ1 (“How are different business models triple sustainable?”).

Most of the analysed organizations are leveraging a higher food quality2. Furthermore, they aim to reach the consumers thanks to the SFSC.

From an environmental perspective the values that we mostly encounter are:

x Natural method of production (1, 2, 3, 4, 5, 6, 7, A, C) which mostly respects the environment in all the different aspects of pollution (land, water and atmosphere),

x Conservation of the territory (2, 3, 7, D); x Natural seasonality of agriculture (1, 2, 3, 6, 7, A, C); x Animal welfare (4, 5, 6, D); x Minimizing the waste (1, 4, B).

To sum up, the organisations leverage environmentally friendly processes.

From a social perspective the values that are fundamental for some SOs are:

x Increasing direct relationship between people/actors within the supply chain (social proximity) (1, 3, 4, 5, 7, A, C);

x Increasing people's inclusion (1, 2, 3, 7, A); x Improving the working condition at the beginning of the Supply Chain (1, 2, 3, 5, 6,

C), x Further developing the rural area with the creation of communities and the connection

and relationship between rural and city areas(1, 2, 3, 7, C) 2 See definition of "high food quality" p 2


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x Increasing the value of the territory and transmission of knowledge (2, 3, 7, C).

From an economic perspective the values are:

x Supporting and developing a SFSC (1, 4, 5, 6, 7, A, C) therefore decrease intermediaries;

x Increasing people equality with an horizontal organization with less salary differences (1, 2, 3);

x Creating social organizations, that have a social scope, this means that they address their investment to the social and environmental aspects, without focusing on the creation of profit (1, 2, 3, 7).

These are the most leveraged aspects of the different organizations. These aspects mirror the strongly idealistic view of the organizations. Nevertheless, they have a BM which leads to an increase in the availability, for consumers, of healthy and sustainable food. All these In order to reply to our RQ (“How different sustainable business models responds in two different geographical regions?”); we now present each element of the BM.

4.4 Characteristics of the model We start describing the reason why each BM is performing well. We want to remind you that we classified the BMs based on three main characteristics: Productive Efficiency Model, Value Model and Network Efficiency Model. Productive Efficiency models relies on human or capital resources to produce commodities. These businesses are usually price takers in a highly competitive market. Perceived Value-based model positions its output as a “want” item and command a price premium (price discriminate). Network Efficiency Model allows efficiencies across the network of suppliers and customers. The main resource is a meeting place, or a platform that facilitates transactions between buyers and sellers. The essential objective of the model is to increase the volume of transactions.

Table 4.4 shows our results.

# Organisation Main reason why the BM is well performing

1 L‟alveare Good network between clients and suppliers

2 Trampolin Good network and perceived value by the clients

3 El Colletero Perceived value by the clients

4 CowFunding Good network between clients and suppliers

5 Grisoxen Perceived value by the clients


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6 Agrozero Good network between clients and suppliers

7 Värpinge Perceived value by the clients

A Bondens Good network and perceived value by the clients

B Karma Good network between clients and suppliers

C Zolle Good network and perceived values by the clients

Table 4.4: The main strength of each BM.

Table 4.4 shows that the majority of the interviewed organizations are focused on “Good network between clients and suppliers” and high “Perceived value by the clients”. The first means that the BM focus on allowing efficiencies across the network of suppliers and clients (Galeano, 2013). Their main asset is a meeting place (real or virtual) which facilitates transactions between clients (usually consumers) and sellers (producers). These BMs focus on increasing the volume (quantity) of transactions. This will enhance the financial sustainability.

The SOs which base their BMs on the Perceived value by the clients, are focus on leverage and express higher quality of their products. As a consequence, the consumers are willing to pay a premium price for these products or services.

4.4.1 Value proposition Each analysed BM offers products and services which have different values. Therefore, we start to present the products and subsequently we present the most common services. The added value of an organization is described as the enhanced value that the company gives to its products before offering them to the clients. The aim is to greater the products perception of value. Overall, most of the organizations (1, 3, 4, 5, 6, 7, A, C) leverage the information embedded with the food. They provide local food and precious information to drive consumer‟s purchase decision. The majority of the offered products are: natural agri-foods (mostly vegetables and fruits) (1, 2, 3, 6, 7, A, C) with minor quantity of cheese and meat. Nevertheless, they are important to complete the offer (1, 6, C). The value is also coming from direct relationships with the consumers (See in Chapter 2.4.2 “Short Food Supply Chain Definition” - Social proximity concept) in order to give the required information (1, 2, 3, 4, 5, 6, 7, A, C). Värpinge (7) manage to add value by directly involving the consumers. They can choose which food/crops the organization should grow. Thanks to the CSA (Community Supported Agriculture), consumers share the growing risk with farmers and they can enhance requests for which


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product the organization should grow. El Colletero (3), Trampolin (2) and Värpinge (7) offer just organic or fair-trade products and the production is carried out by excluded or disable people. Therefore, their value proposition is deeply connected with social and environmental sustainability. CowFunding (4) and Grisoxen (5) are focused on natural agri-food products, especially on meat. The attention on providing the requested information to the end consumers is still very present and strong. The aim is to involve the consumers also emotionally (4, 5) (for instance with their marketing strategies). The offered services are: home deliveries (4, 5, 6, C), through a SFSC that is usually managed by an online platform where the consumer selects the desired products or prepared food box. Other offered services are: training programs and general handwork services (such as cultivate abandoned – or other‟s- lands) (2, 3, 7).

Some of the analysed BMs aim to differentiate themselves with a brand differentiation strategy. Some of them have clear strategies with a label and brand (4, 5, C). Others have a brand which helps clients to associate them with their value but they do not hold label (1, 2, 3, A).

The following table (Table 4.5) presents the main features which characterize their products/services.

# Organization Value proposition

1 L‟alveare Brand policy and differentiation; Accessibility; Risk reduction;

2 Trampolin Customization; Brand policy and differentiation;

3 El Colletero Work done; Brand policy and differentiation;

4 CowFunding Accessibility; Performance improvement; Brand policy and differentiation

5 Grisoxen Brand policy and differentiation; Accessibility; Work done

6 Agrozero Brand policy and differentiation;

7 Värpinge Customization; Brand policy and differentiation; risk reduction

A Bondens Brand policy and differentiation; Accessibility

B Karma Accessibility


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C Zolle Customization; Accessibility; Brand policy and differentiation;

Table 4.5: Organization’s value proposition. “Brand policy and differentiation” means that the organization enhances high product quality; “Accessibility” stands for an easier access to consume/ to access the products/services; “Risk reduction” entails that the organization shares some of the operative risks3 with the consumers; “Work done” implies an intermediate and assist the customers with certain operations/tasks; “Customization” tailors products and services to specific needs of the end customers.

Products/services and strategy adapted: The main products/services strategies adopted by the SOs are: Accessibility (1, 2, 3, 4, 5, 6, A, B, C), this means that they focus on an easy products accessibility directly to the consumer's; Risk reduction (1, 3, 4, 5, 6, 7) this means that most of these SOs sold products before that it is handled; Product differentiation (1, 2, 3, 4, 5, 6, 7, A, B, C), this means that they focus on offering different products to different targeted groups. Increase efficiency (4), instead, entails a better efficiency of the processes.

3 Värpigne is sharing the “growing risk”. It refers to the cost of production if the harvest is not good. The food producers have high production costs without the guarantee that the harvest will be good. Sharing the "growing risk" means that the consumers pay in advance the food products.


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4.4.2 Clients

Each business has to deal with the clients (i.e. people who are willing to pay for the offered products or services). In our research, the consumers (end clients) are the people who are willing to pay for the organizations’ products and/or services. We now present the characteristics of the approach to the consumers, emerged during the collection of primary data. Thus, the characteristics that the investigation has pointed out.

The motivations why clients buy from the SOs are slightly different for each of them. Consumers are interested in purchasing organization's products because of the embedded information of the product itself (1, 4, 5, 6, 7, A, C) and because they are directly involved in the community and SFSC (1, 3, 7).

All of the BMs declare that consumers buy for having high food quality. Therefore, consumers share both values and vision of the organization itself.

When it comes to analyse the market‟s segments, all the analysed BMs target a market niche. It is mainly composed by families and sensible people who are looking for quality products and they are aware of sustainability aspects.

Table 4.6 shows the main sales channel, clients relationships and focus channels leveraged by the analysed organizations.

The third column explains where the SOs spend more efforts (in order to influence client‟s purchase decision). “Purchase” stands for the moment when clients buy the products. “Delivery” indicate that moment in which the organization delivers the offers to the clients. “Post Sale” are the services offered after sales. “Information” discloses products advices.

The sales channels (fourth column) clarify how products reach consumers through the marketplace. In the analysed cases, it is thought: e-commerce (“internet sales”), stores/shops (“other stores” or “own stores”) or sales force.

The last column explains the relationship with and within the clients. “Personal assistance” implies a human interaction between clients and organizations; whereas; “Communities” stands for developing relationships between and within a group of consumers.


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# Organization Focus of channel phasing

Sales channels Clients relationships

1 L‟alveare Purchase, Delivery Internet sales Personal assistance

2 Trampolin Delivery, Post-sale Own stores Other Stores sales force

Personal assistance,

Communities

3 El Colletero Delivery Own stores Personal assistance Communities

4 CowFunding Information, delivery, post sale

Internet sales Personal assistance

5 Grisoxen Information, delivery Sales force, Internet sales

Personal assistance

6 Agrozero Information, delivery

Internet sales, sales force

Personal assistance

7 Värpinge Information, Own Shop, Internet

Personal Assistant, “communities”

A Bondens Information, Sales forces Personal Assistant

B Karma Purchase Internet sales Self- Serving

C Zolle Information, delivery,

Internet sales, Own Shop

Personal Assistant

Table 4.6: The relationships between the organization and the end customers.

Strategy adapted: Now we present the adopted strategy for Clients Segment, customers relationship and distribution channel. Clients Segment The main strategies adopted by the different SOs concern when they have to choose the clients segments are: Diversification (1, 2, 3) and Segment penetration (3, 4, 5, 6, 7). The first one (Diversification) means that they are looking for a different client segment for example they are looking for building a community/groups of close consumers or they are


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searching for particular clients that share their value. The second strategy (Segment Penetration) means that they try to explore more in the already existing consumer target. Customer relations The customers relations strategy adopted by the SOs are: Interface (1,C) which implies an easy and friendly interface for and with customers; Customization (1, 4, 5, 6, 7, D) which entails higher focus on customized products and services based on end customers‟ needs and requirements; Customers participation (1, 3, 4, 5, 7) which aims to build a system where end customers are directly involved on the SC; Content (2, 7) implies meeting end customers‟ requirements in the best possible way. Distribution channels The mainly used distribution channel strategies are: Direct control of the supply chain (1, 3, 4, 5, 6, 7, C), which means that they have a direct control over all, or the majority, of the operations of the supply chain; share with other organizations the same distribution channel (2); collaborative networks (2, 4, 5, 6, A, B, C); Accessibility (4, 5, 6, C) facilitate to reach the distribution channel. Improving the technology helps consumers to find the products in any moment or place. When using a well-established distribution channel, the BM aims to create a complementary effect. The collaborative networks improve the distribution channel‟s efficiency. See Chapter 3.4.1 “Short Food Supply Chain Definition” - Different Perspectives on SFSC, for reading more about the different types of collaborative network.

4.4.3 Revenue model

The SOs' products prices are usually fixed. They are calculated according to market‟s prices. The structure of the profit margin is different. For example, L‟alveare (1) keeps as a margin of 20% of the selling price (10% for the platform; 10% for the host) so 80% is for the producers; El Collettero 50% for the expenses and 50% for the producers; other as Agrozero's margin is 30% of product's price. Grisoxen and CowFunding‟s revenue model comes from usage fees. In the following table (Table 4.7), we report the main source of income:

# Organization Source of income 1 L‟alveare Usage fee on the sales, % on the sales 2 Trampolin Products sales; Subvention 3 El Colletero Product sales, Subscription fee, Subvention 4 CowFunding Usage fee on the sales 5 Grisoxen Usage fee on the sales 6 Agrozero Usage fee on the sales

7 Värpinge Usage fee, Subscription fees, Product sales

A Bondens - ----

B Karma Usage fee on the sales


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C Zolle Usage fee on the sales

Table 4.7: The source of income for the different organization. “Usage fee on sales” means the clients are playing a margin or a fee to the organizations, in order to use the services. “Subventions” are public financial aids, given by the government, that certain type of organizations can have access to. "Products sales" implies that the organization is producing and selling products or services.

Strategy adapted for revenue model: The main revenue strategies adapted from the analysed BMs are: Traditional method (2, 4, 5, 6, 7, B, C) means through the selling of products; Royalty (2, C) a percentage on the sold products; Subvention (2,3) form of public found due to social activities; Subscription (3, 7), users need to pay a contribution a fee to be associated; Payment by use (1, 4, 5, B, C,) the users pay a percentage on the price to use the service. 4.4.4 Resource and assets The resources and assets of the analysed SOs are different for each of them depending on their aim. The number of employees fluctuates between 1 to several people. It depends on the business‟ dimension (the number of employees had been reported in the general description of the SOs). The profile of employees and their competences vary for the different SOs. In general, no specific competences are required. Some examples of structure are: Trampolin (2) has two administrators, three technicians of production and three technicians of insertion and one economist and 21 people who are working and they are in the insertion program (those people can stay not more than 3 years, usually 1-2 years); L‟alveare (1) has one host for each community; CowFunding (4) has one full time, one chef (who is helping with recipes), one farmer (which is also co-founder) and one part time employee who is charge of the operations. Agrozero (6) has just one full time employee. Grisoxen (5) has four part-time workers (however they are working for “free” so far). Varpinge (7) has three employees and nine volunteers. A business has to count on different assets. The assets we found are different depending on the core business of the SOs. The organizations which are also performing the production, they usually have some production machineries (such as tractor) (2, 3, 7). If they do not own the specific machineries required for the operations, they rent or shared it with other organizations (2, 3). If the organization is also offering the delivery service, it may need a truck or a car (1, 2, 3, 6, C). In the case of cheese and meat, they also need a refrigerated box or refrigerator truck (1, 6). In some cases the different BMs that have their own local shop or place in the local market (2, 3, 7, C) where they sell their products directly to consumers. In other cases the main asset is the web platform where the products are sold and bought (1, 4,


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5, 6).

Grisoxen (5) prefers not to own the offered services. They outsource all the not-core services such as home deliveries, slaughterhouse‟s processes and so on.

Strategy adapted for resource and assets: Most of the assets and resources are rather easy to imitate. The main tangible assets are linked with technology (digital platforms and IT systems). Some organizations (1, 2, 3) share their tangible assets. Thus, an organization shares resources with other organizations. The strength of these organizations is more linked with intangible assets. Their strategy is focused on intangible assets (such us image and knowledge). Their presence and reputation in the market is their best asset. Since it is intangible, it is hard -and it takes long time- to be imitated.

4.4.5 Costs

Table 4.8 reports the cost model and structure that the different analysed SOs use. “Low Cost Model” entails the goal of the business to cut costs whenever it is possible; whereas “Value Creation Model” aims to premium value proposition and personalized services. As far as the cost structure, “Variable” (“fixed”) costs (do not) change depending on the volume of the goods sold. “Economies of scale” (“scope”) aim to reach lower unit costs increasing the production (the range/variety of the products).

# SO Cost model Cost structure

1 L‟alveare Low Cost models Economies of scale 2 Trampolin Value creation models Fixed Costs, Variable Costs 3 El Colletero Value creation models Variable Costs, 4 CowFunding Value creation models Fixed cost & Economies of scale 5 Grisoxen Low Cost models Variable Costs & Economies of scale 6 Agrozero Low Cost models Economies of scale, Fix costs

7 Värpinge Value creation models Economies of scope, fix costs

A Bondens Value creation models Economies of scale, Fix costs

B Karma Value creation models Economies of scale, Fix costs

C Zolle Value creation models Economies of scale, Fix costs

Table 4.8: cost model and structure of the SOs.


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Strategy adapted for the costs: The main costs strategies adapted from the analysed SOs are: Affiliate network (1, 2, 3, 4, 6), they focus on maintaining and building a network of clients; Simplification of the value chain (1, 3, 7, A, C), this means that the supply chain is really simple, shorter, build on strong relationship and more flexible; Integration of the activities (2), therefore do not have outsourcing strategies; Share capacity (2), this means that they share their resources in order to maximise utilization; Subsidized costs (2,3), this means that part of their cost are subventioned; Outsourced (5) means that they are focused on outsourcing some activities.

4.4.6 Process and activities Each business is based on its processes and activities which let information and products flow from the suppliers to the consumers. Now we report the main processes and activities that we encounter in the analysed SOs. The main encountered activities are: cultivation and natural production activities (2, 3, 7); collecting and distributing the products (2, 3, 4, 6, C); social inclusion and training programs (2, 3, 7); maintaining a strong network between clients and suppliers (1, 2, 3, 4, 5, 6, C); offering complementary services (1, 2, 3, 4, 5, 6); selling products of different suppliers to expand the offer and to reach economies of scope (1, 2, 3, 4, 5, 6, A, B, C); being the broker between clients and suppliers, selling someone else's product without executing activities linked with the product (2, A, B); volunteer activities (such as help disabled people) (2, 3, 7); awareness rising process of the consumers (1, 3, 6, 7); checking and assure the quality of the service and the products (1, 2, 3, 4, 5, 6, 7, A, C). The processes are usually based on product‟s production, sell and distribution. In the BMs, it is very important the network‟s position of the organizations. They link the suppliers with the consumers (1, 2, 3, 4, 5, 6, B, C). More in detail, mostly in agriculture, the operations are deeply connected with the environment conditions (2, 3, 7); therefore, the daily activities are not fixed but they range with the different daily necessities. For other organizations based more on the products‟ deliveries (1, 4, 5, 6, B, C), the operations are more standardized and thus they are repetitive on daily bases. These are: organization of activities of products‟ distribution and collection (1, 2, 3, 4, 5, 6, C); collection of foods from supplier (1, 3, 6, C); separation of the collected food (1, 2), in the prefixed box (3, C); distribution of the products to consumers (6, C) and in a specific place (1, 3, 6, 7, C). Agrozero (6), CowFunding (5), Grisoxen (4), L‟alveare (1), Karma (B), Zolle (C) are all web based organizations. Some of them aim to completely automatize and to digitize consumers‟ assistance. This is to cut operations‟ costs. However, they declared that, there is still a lot of personal assistance. Not only they need to further develop the IT system to reach a more automatized operations (5, 6); but also to change consumers‟ purchase habits. They often order through personal assistance rather than through the web-platform (4, 6).


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Table 4.9 shows the main processes of the organizations. Most of them are focusing on Platform/network or Produce/service or both of them. The platform/network refer to all the activities that have the scope of building and maintaining a strong and efficient network of people or a platform that allow an easy network; meanwhile the production/service are all activities that are focused on production or services offerings.

# Organization Main processes 1 L‟alveare Platform / network 2 Trampolin Production / service; Platform / network 3 El Colletero Production / service; Platform / network 4 CowFunding Platform / network 5 Grisoxen Platform / network 6 Agrozero Platform / network 7 Värpinge Production / service;

A Bondens Production / service;

B Karma Platform / network

C Zolle Platform / network; Production / services

Table 4.9: The main processes of the organizations. The communication between the organization and the stakeholders is mostly carried out with digital and phone communication. The most common channels are: Facebook (1, 2, 3, 7)or social media in general; "Whatsapp" groups (2,3), emails (1, 6, B) and personal contact (7, A, C).

Strategy adapted for the activity and process: The main costs strategies adapted from the analysed SOs are: Collaboration (1, 2, 3, 4, 5, 6, C), means the focus on collaborate and share activities within the supply chain and with all the stakeholder of participating in the organization; innovation (1, 4, 5, 6, C) uses more innovative process and activities.

4.4.7 Supplier Most of the analysed SOs depend on suppliers (see Chapter 5.1 “The Short Food Supply Chian” to read the main consequences of this decision).

The number of the suppliers varies for every SOs. In general, it is important to satisfy the consumer‟s needs which usually require different products (at the same moment) (6). Therefore, the organization needs to integrate and to complete the offering with a network of different suppliers (1, 6, A, B, C). For example, Agrozero (6) has eight suppliers several of which are local producers of fresh and seasonal agri-food such as fruits and vegetables,


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cheese and meat. Agrozero (6) has also a partnership with “L‟altro Mercato” (which is a fair trade organization). This partnership enlarges the products which cannot be produced locally.

Another example is Trampolin (2) and El Colletero (3). They have a network of suppliers which provides products that are not produced by the organization. Moreover, the network is ready to supply products also when the organization‟s production is insufficient.

El Colletero (3) follows some principles for looking for suppliers. First, they need to be local and organic food producers, if not they need to be small / familiar businesses.

For L‟alverare (1), it is really important that each community has at least five suppliers and at least one local supplier of fruits and vegetables. Then, the most important are meat and cheese suppliers.

Grisoxen (5) has six strategic partnerships. Three of them are farmers (suppliers), one logistic company and one slaughterhouse. Although, they are looking for more logistic suppliers and slaughterhouse.

The experience of working with suppliers is different for different business. For some of them (2, 3), it is easy and the suppliers are willing to collaborate and to share the same values (2, 3). For others (1, 6), the cooperation is difficult. The obstacles are mostly on letting the farmers understand and approach the technologies (1, 5, 6, 7). Moreover, the suppliers- which provide the same products- experience competition with each other. (This is not valid for meat producers because the demand of meat is larger than the offer). Another obstacle to overcome is supplier's fix procedures and rules (5). They make the collaboration more difficult.

Värpinge (7) does not have any suppliers. The organization is producing and providing itself with all the needed raw material (such as seeds). This is the only example where the supply chain is really short with no dependence from suppliers.

4.4.8 Financing

The analysed organizations have different capital structures which match their purposes and values.

The businesses, which are using digital channels, are intended to be start-ups (1, 4, 5, 6).

In the case of non-profit organizations (2, 3), the organizations have access to public subventions. Trampolin (2) is surviving thanks to government subventions. Over six years, 70% of their income has come from public subvention (even if it is decreasing as time goes by).

In the case of El Collettero (3), the subventions are really low and they cover just part of the


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expenses of the training program. These non profit organizations are associations or organizations which acquire the status of “national social organizations”. If they have profit, they invest it in organization‟s activities or donations (2, 3, 7).

The initial investment happens in different ways depending on the organization. For example, Trampolin (2) started with an association and it used private small capital to start the production. Meanwhile, CowFunding (4) started with external investors.

4.5 Criticism Here we present the main criticisms that the analysed BMs have encountered. The main obstacle for L‟alveare (1), Grisoxen (5), Agrozero (6) is to find the right suppliers with all the requested characteristics. For Trampolin (2) the main obstacle is the high costs of the land and services (such as water) (thus the high production cost which obstacle a continuous growth of the production). For CowFunding (4), it is complicated to insert and to include the environmental sustainability in their business model. The meat consumption is widely knownfor not being environmentally friendly due to the unsustainability coming from intensive livestock such as high use of resource and pollution. Anyway, they try to be environmentally sustainable promoting a conscious consumption of meat (which respects animal‟s welfare). For the organizations which are working with public subvention, the public waiting time is one of the main problems. It is the time they need to wait for receiving the money (since those subventions arrive always after the actual costs) (2). A general problem faced by some SOs is that they provide seasonal products and so they are highly dependent on the environment and limited in their offer to clients. CowFunding (4) believes that in the Latin European Countries his business cannot thrive. This is due both to a different interpersonal approach and to the control of the grocery market. In South Europe, consumers have the possibility to chose to have grocery shopping in small specialized boutique. There, they ask where the meat comes from and they know the story of the animal. So CowFunding believes that the organizations (4, 5) have no reason to exit (it does not add value to the system).

4.6 Local Food To all different interviewed people, we asked how they were defining “local food”. The following table (4.10) presents their opinion.


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Person Organization Definition of local food

Michele Di Biase Agrozero “Local Food is within ASL4 boundary limits”

Markel Collis Grisoxen “Until last week, I believe local food is within 100km, then -last week- i discovered food which travelled for 500km max, it is still considered local”.

Gertjan Dieleman CowFunding “Local Food is connected with the perception of control that the end customers manage to have. This leads to a higher trust for the people.”

Lupe Martín Trampolin Local food is what is produced in the territory, within the island. (70km radius)

Raquel Ramirez El colletero We consider local the product form the territory normally within 20-50 km

Paolo Nosenzo L‟alveare “food near within 30 km usually, but supplier with less than 250 km ”

Table 4.10: The definition of "local food" for the different SOs.

4.7 Digitalization of services Digital solutions are penetrating several aspects of our life, such as our way of buying goods or services, the communication system and so on. We believed it is interesting to analyse how the food producers are dealing with new digital technologies when it comes to their operations. This analysis had elicited that there is still a lot of people who do not trust or have a hard time dealing with technology and IT; especially the farmers (1, 5, 6). Small producers have a hard time inserting the technology in their supply chain, therefore they continue to use traditional methods. The intermediaries (1, 4, 5, 6) often have relationship‟s difficulties with the small producers. The small producers are more focused on the production activities and they aim to avoid what does not directly increase their production output. Furthermore, small producers usually hava a farm tradition family background. This makes the progression process harder because they tend to be stuck with the traditional processes and methods (4, 5). The analysed BMs are also helping the food producers to approach

4 See acronimus p 2: ASL (Azienda Sanitaria Locale)


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technologies and communications tools. They want to help producers in order to develop their business and a smooth collaboration (1, 6). Karma (C), is a web based platform which has high digital asset and competences. It is the most technological organization in our sample. It automatizes all the digital and platform based operations and it leaves the physical operation to the suppliers and end consumers. Karma runs its business exclusively through technology. There is a young team working in Karma, thus they are more accustomed to technologies and digital devices. Varpinge (7), declares that organizations like Grisoxen or CowFundings are exploiting a gap they saw, which is that farmers are not accustomed to technologies and how to use them to sell products while consumers are using them to find needed products. Therefore they positioned in the middle.

4.8 Sustainable Model In this part we report the result for answering to the SQ1 (“How different business models are triple sustainable?”). In order to evaluate organizations sustainability we develop a “Sustainable Model”, in this chapter we present the model, how it works and how we use it. Thanks to the literature review, we discovered there was not a complete framework on how to rate and evaluate the sustainability in the food industry. Therefore to fulfil this gap and evaluate the sustainability of the interviewed organizations we decide to develop a sustainable model. Thanks to the combination of write-storming, interviews (Nordlund, 2017; 1, 2, 3, 4, 5, 6,7), literature review and frameworks, we come up with a sustainability model evaluation, more in detail we take inspiration for all the sustainable actions (part of the model). As far as the literature review and models, we used the following scientific documents that help us to develop the sustainable model more specifically we use these in order to develop the different aspects and actions (part of the model):

- ISO 14000; - EU sustainable goals, - Economy of the Common Good; - Sustainable KPIs (Reineck, 2011); - Sustainable aspects (Holton, 2008).

All these previously mentioned frameworks helped us to identify which aspects and actions need to be evaluated. We analysed what a sustainable business model is, how to individuate a sustainable supply chain and what sustainable food is. We also decided to base the sustainable model on the concept of triple sustainability, that is coming from the “Triple bottom line” (Hudson, 2014). The scope of the following work is to develop a model to analyse and rank the sustainability of an organization in the food industry. We consider sustainable food as food which is produced in an environmentally, ethically and economical sustainable way. Furthermore, the food has to be distributed within a sustainable SC.


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As we stated before, different frameworks and models (which aim to help organizations to improve their sustainability aspects) are already existing. However, there was not a complete model which could be used to evaluate and to rank the organizations triple sustainability in the food industry. Our framework is suitable both from a consumers and from the organization point of view. The “Sustainable Model” is divided in three main sustainability categories, following the triple bottom line, these are: Social Sustainability, Environmental Sustainability and Economic Sustainability. For each of these categories we individuated several important aspects affecting the sustainability of the organization. For each aspect we assigned specific actions that can have a positive or negative effect. In our model we defined fix points for each sustainable or unsustainable actions. We associate a numeric scale for each sustainability´s actions in order to give an objective judgment. Points are assigned with a plus and minus sign depending on which way the organization performs the activity. Plus sign means that the organization is sustainable under that specific aspect; minus sign means that it is acting in a unsustainable way. The scale ranks from 1 to 5, it depends on the impact and importance of each sustainable action. The scale used is described as: +1. Lowest sustainability impact. +2. Slightly low level of sustainability. +3. Average level of sustainability +4. Slightly high level of sustainability. +5. Highest sustainability impact. The lowest sustainability impact (“1”) means that the action is sustainable for the organization but it does not contribute so much to the global sustainability. The highest one (“5”) indicates that the action has high impact on the global, local and organizational sustainability. Grade “3” means that the sustainable action has an organizational, local medium high impact but low global impact on the sustainability. All the others are average grades. The negative scale is: -1. Lowest unsustainable impact. -2. Slightly low level of unsustainability. -3. Average level of unsustainable -4. Slightly high level of unsustainability. -5. Highest unsustainable impact. The lowest unsustainable impact (“1”) means that the action is unsustainable for the organization but it does not contribute so much to the global unsustainability. The highest one (“5”) indicates that the action has high impact on the global, local and organizational unsustainability. Grade “3” means that the unsustainable action has an organizational, local and low global


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impact. All the others are average grades. This scale and each association to the sustainable aspects is based on our idea that it comes from our common sense and our experience on the sustainable food aspects. Moreover, it is based on the number of time we found these aspects reported in different literature researches. Appendix D shows the Sustainable Model used to analyse the organizations‟ triple sustainability. We used these tables to obtain the values presented in Chapter 5.2 The business models’ sustainability. Next chapter (Chapter 5: Analysis) brings the analysis of the data presented in this chapter.


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Chapter 5: Analysis This Chapter presents the analysis of our research. Therefore, we study the information and results that we presented in the previous chapter. Furthermore, we linked them with the literature study we had conducted. We start dealing with the local food. Then we link it with the SFSC. Afterwards we mapped the BMs sustainability, we analyse the results and report the similarities/differences in the two geographical areas.

5.1 SFSC - Short Food Supply Chain

In order to be able to explore our main RQ (“How do different sustainable business models respond in the Nordic and Latin European Cluster?”) we identified the concept of local food, which is very important since it is a crucial characteristic of sustainability. At the same time, it is a requirement which consumers in both clusters are looking for. Furthermore, local food is a fundamental characteristic of SFSC. From our primary data collection and from the literature review, the importance of the local nature of food comes out in several occasions (1, 3, 4, 5, 6, A, C). However, it is not well defined what “ local” stands for.

Here we aim to clarify the concept of “local food” and to present the analysis of SFSC (since these two topics are highly correlated between them). Finally, we present how the digitization and technology affect the type of SFSC.

Local Food

Our literature study and data collections shows many different definitions of “local food”. They can be divided in two categories based on the considered aspects. Specifically, it can be the physical distance or the number of intermediaries. These two concepts are reflected by the concepts of physical and social proximity (discuss in the Chapter 2.4.1 “Short Food Supply Chain Definition”).

From a geographical/transport point of view, in the Latin European countries allowed covered kilometres are fewer than in the Nordics Countries. This due to the shorter distance, higher presence of variety of products that is possible to grow in the southern countries compared to the northern ones. It is important to consider this aspect when analysing the sustainability (since the logistic/transportation of food is one of the main sources of pollution for the food industry).

Let‟s take for instance two similar business models: Bondens (A) (Sweden) and Agrozero (6)


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(Italy). The two organizations aim to group all the small and medium food producers within the same area. This due to reach synergies and to expand consumer base. According to Bondens (A), the “same region” is within 250 km (with exception for the Nord region of Sweden; there the allowed distance is 400 km). Meanwhile, for Agrozero (6); the same region is within 50 km. Even if they have a different conception of geographical distance, they are still operating within the SFSC. They form a short circuit this means that they are the only intermediaries between producers and consumers. This leads to high social proximity (where products - embedded of information- reach the consumers). Moreover, a mutual relationship of trust and acknowledgement is established between producers, organization and consumers (6).

CowFunding (4) is leveraging the “spatially extended” concept. They stress the history of the region of production (very well known for the countryside and farm presence). The products carry with them the long traditions and process of the production place. This adds value to the product. There the organization manages to spatially extend one place above the geographical limits.

As far as the social proximity, (i.e. the number of intermediaries), it is important to consider the number of players involved in the SC. Therefore, how much information is lost in every passage. Gertjan Dieleman (2017) considered “local food” as: “food which arrives embedded with all its information to the consumers”. This is most probably the key for considering the adequate number of intermediaries. The reason is that the lower number of intermediaries means an increase of social proximity and probably physical proximity of the SFSC. This means that a face-to-face relationship with direct sales from producers to consumers is the idealistic situations for a sustainable SFSC. The social proximities (trust, loyalty, awareness, construction of community and so on) are leveraged by some BMs (1, 3, 6). This is one of the main added value of these businesses. (To know more about the social proximity and its consequences, we suggest you to read the subchapter 2.4.1 “Short Food Supply Chain”). Consumers are looking for the information and for the history of the food (this in both clusters). They basically want to know what they are eating. Therefore, the food which arrives to consumers, with its own history and information, as considered local. Especially because healthy and fresh food is the main purchasing force for consumers, thus it is why is important to operate with social proximity (see Chapter 2.2.2 “Food Quality” - Quality of food for consumers in different clusters). Consumers believe that eating local food aims to boost the sustainability. This basically because they want to eat healthy food which was grown with a sense of respect towards the environment and the people in their territory (Nordlund 2017).

Providing fresh food decreases also the lead time between production and consumption. This


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leads to different consequences such as decrease of waste, availability of healthier products less usage of energy. Some of the analysed BMs (1, 2, 3, 6, 7, C) are using these aspects to decrease costs, increase their sustainability and take those concepts as their basic value to increase products value.

To sum up and to conclude, we state that food, to be considered as “local”, needs to reach the consumers embedded with the production‟s information through a SFSC. This means that it needs to have a limited number of intermediaries. Furthermore, as far as the physical distance, we consider “local food” that food that is grown within the same geopolitical region. Be local is an important sustainable valuable characteristic of the products. This is valid both for the Nordic and Latin European cluster because the difference between the geographical dimension of the regions balance the needed physical distance in the SFSC.

This analysis has been based on our limited number of interviews. The results are supported by the literature review as well.

5.2 The Business Model's sustainability We used the developed Sustainable Model (See Chapter 4.8) to measure the level of the social, environmental and economic sustainability of the analysed SOs. Moreover, the Sustainable Model is a starting point for increasing the awareness on the need of an evaluation scale of the organizations' sustainability. Appendix D shows the sustainable model‟s tables. The following subchapter (Chapter 5.2.2. The business models’ sustainability) presents the result of applying these sustainable tables for each organization. The tables showing the results are available upon request (email: [email protected] or [email protected]).

The sustainability map (presented in the Chapter 4.8.2 The Sustainable model) is now used to investigate the triple sustainability in different BMs. Table 5.1 shows the results of the analysis.

#

Sustainable organization

social [MAX: 138 ; min: - 81]

environmental [MAX: 237; min: -181 ]

economic [MAX:142; min:-71 ]

total [MAX:517; min:-333]

1 L‟alveare 90 73 80 243

mailto:[email protected]



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2 Trampolin 125 74 29 228

3 El Colletero 126 104 61 291

4 CowFunding 79 63 64 206

5 Grisoxen 85 43 78 206

6 Agrozero 69 34 62 165

7 Värpinge 112 148 96 356

Table 5.1: Mapping the triple sustainability for the Sustainable Organizations From this table (Table 5.1), we compare the triple sustainability of the analysed SOs. In attachment (See Appendix D) we provide the "Sustainable Model" that has been used to analyse the SOs and get the identified figures. This wants to be also an example of the result get from the Sustainable Model that is used to evaluate the organization‟s sustainability. Since we developed the model and we performed the test ourselves, the results may be influenced by us. Even though, during the analysis, we had been as objective as possible. Moreover, since developing the sustainability framework has been an on-going process with the collection of primary data, we lacked specific information for some SOs. To avoid this lack of information in the future investigations, we advise to fulfil the sustainability model together with the representative of the organization. One important conclusion is that we just selected organizations with high level of sustainability, this choice had been reflected from their sustainability analysis. This is showed by the total rank. It is really high in all categories. For this reason we affirm that we chose sustainable organizations (SOs). We plotted these results in a graphs in order to observe different characteristics of sustainability. The following conclusions come from this graph analysis. First we plotted the results of the three different sustainable aspects (social plus environmental plus economic) for each SOs separately (graph: S1, S2, S3, S4, S5, S6, S7). In those graphs, it is possible to observe some interesting elements. First, the level of each sustainable aspects in percentage related with the possible total level of sustainability. Second, the balance of the three sustainable aspects (where the red triangle is almost equilateral, there is a perfect balance between the different aspects). Third, the area of the triangle shows the total level of sustainability (expressed as a percentage of the total area). Fourth, since the SOs are made with the same characteristic and dimension it is easy to compare each of them with the others. These graphs show which sustainability field the organization needs to improve. In order to increase their sustainability level, we suggest to improve first the areas where they were negative, after the areas where they had no points. From these voices, they get some ideas on


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which aspects they need to improve. We plot the resolute in a positive three dimensional graph but we suggest to use a three dimensional graph, where each sustainable aspects has a negative and positive axe (since it is possible that for a general organization the result is negative in one or more aspect). Our organizations were all positive in every aspect, therefore, we just use the positive dimension of each axe.

Graph 1: Sustainability Map – S1 Graph 2: Sustainability Map – S2 Graph 3: Sustainability Map – S3 Graph 4: Sustainability Map – S4 Graph 5: Sustainability Map – S5 Graph 6: Sustainability Map – S6 Graph 7: Sustainability Map – S7


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Furthermore, to compare all the SOs all at the same time, we plot the result in graph 8.

We notice that if a BM thrives in one aspect it struggles in the other aspects of sustainability (for instance 2, and 3 it is thriving in the social sustainability but it has a very low economic).

In general, the most enhanced aspect is the social sustainability, second is the economic and the last one is the environmental.

Regarding the differences of the two clusters; we noticed that there are none. This means that the approach of sustainability is not influenced by the cluster.

We want to clarify that the discussed findings are affected by: a limited sample of SOs, our influence and interpretation of the results and the lack of some information.

Graph 8: The sustainability results for all the investigated BMs


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5.3 The business model characteristics in different clusters

In this sub-chapter we analysed the BMs, their different features and the conditions in the different geographical areas.

Different situation in different clusters

The market system (in the Nordics and in the Latin European countries) is very different. In the Nordic countries, the 90% of the grocery market is owned by three big brands (Nordmark, 2015). Therefore, consumers declared that it is hard to find locally produced food (4). Instead, in the Latin European countries, consumers manage to buy local food (for a price premium) in small shop, boutiques, or directly from the producers (however, they claim limited product‟s availability). This because the presence of small shop or small producers in the Latin European market is higher.

Why is this happening? There are different causes.

One is the climate. Let‟s analyse the case of “Bondens (A) and “Agrozero” (6). The Swedish organization (A) works only from May to September while the Italian one (6) works all the year around. So for this SOs working with small medium suppliers of seasonal food in the Latin European cluster, it is easier to reach the financial sustainability, to improve the business and to assure continuous supply to consumers.

Therefore, here we see the first big difference. In the Latin European countries, the service is represented by a continuous flow long all over the year; meanwhile in the Nordic area there are gaps. In order to provide a continuous service; in the Nordic countries, many organizations are investigating other food products which is possible to provide all year long - beans for instance (5). This will enhance the financial sustainability.

In the Nordic countries there are just big industries for processing the raw material (for instance slaughterhouses and milk processors) (Nordlund, 2017). This implies high competition, economy of scale and difficulties for small and medium producers to process their products and then reaching consumers. Therefore, small and medium food producers need to pass through big food companies (Arla, for instance). The same problem has not been reported by the Latin European cluster this because there the presence of small medium processing industries is higher.

BMs’ differences and similarities in different clusters We now present the differences and similarities of the two studied clusters.


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We now report the BM’s differences of the two clusters. The BMs of the Latin European cluster are based and are often born in order to share and follow sustainable value (1, 2, 3, 6), while in the Nordic cluster, they are more focused on the profits (4,5) (exception for the 7). Beside that Latin European countries are more focused on social value (1, 2, 3) while the Nordic one are more focus on the environmental and economic sustainability (Nordlund, 2017). This is also slightly expressed from the evaluation of the sustainability of the BMs in Chapter 5.2 The Business Model Sustainability. In the value proposition of the services and the products we find some differences as well. Latin European countries are more focused on owning shops or meeting consumers (i.e. they stress the social proximity of the SFSC - 1, 2, 3, 6); meanwhile the Nordic ones are more focused on home deliveries (4, 5). (The only exception is Värpinge, 7).

We now report the BM’s similarities of the two clusters. All the BMs are based on strong similar values. They rely on good network and high perceived value of the products. These small/medium organizations are often claimed to be “idealistic” because their values are taken into higher consideration rather the financial performance. In both clusters are offered different products and services; but this does not depend on the cluster but more on the geographical availability of products. Products have the common features to be consider high quality products. Contrary to what is believed by Gertjan Dieleman (4) selling meat products online is working both in Nordic and Latin European countries (1, 6, C)


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In both clusters, the SOs focus their value proposition on brand policy and differentiation strategies.

Half of the analysed organizations (1, 5, 6) have a low cost models. It means that the goal is to cut costs wherever it is possible. The other half of organization (2, 3, 4, 7) are focusing on a premium value propositions and on personalized services. This is not related with the geographical area.

Our literature review showed us the main forces playing a role during the clients purchase moment (in the two clusters) - See Chapter 2.2.2 "Food Quality in two different clusters". The two clusters show that health, convenience and process characteristic are changing the trends of what people consume. However, the food industry plays an important role to shape the future of sustainable food.

Health is more and more present in the EU public agenda. Since politics directions mirror citizens‟ interests, it is not random that the Eurobarometer survey (EC, 2006) has shown that the main objectives which have to be promoted by Common Agricultural Policy (CAP) are:

1. To offer health and safe food products;

2. To respect the environment;

3. To promote organic production

The food industry is moving toward the facilitation of these three points and studied SOs leverage these points. In both clusters, the investigated BMs want to highlight these aspects. The analysis of BMs‟ differences, in different clusters, is based on the chosen and interviewed BM. This strongly influences the reliability and validity of these analysis since it depends on random causality. Therefore, we want to remark that these differences and conclusions are exclusively valid for the BMs we interviewed.

5.4 Analysis of the study’s reliability and validity We want to be critical on our research. This enhances the scientific approach (as a consequence the reliability of our work). The conducted method followed a systematic, objective and critical approach. We aim to reach a coherence throughout the whole report connecting the problem formulation and purpose to all different subchapters. The study is objective and critical in a sense that the analysed data had been analysed with a low impact of our own interpretations, in the most


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objective ways. All our conclusions and findings have been critically discussed and justified. The input data have been critical evaluated with the triangulation method. Just if they were approved through the triangulation method, they had been used. The interviews to the sustainable organizations were partly structured (which enhance the validity) and partly semi structured (there, the validity had been affected). The validity had been enhanced in our work thanks to the low anonymity rate. Even if we gave the possibility to be anonymous in the report, no one decided in this sense. We do not believe this has affected in any way their answers because they asked to treat in a confidential ways some information.

5.5 Criticism We have to be critical on our research and findings.

First of all, the analysis had been affected by the chosen SOs. It is likely that if we analysed other organizations, we might have obtained different results. Moreover, the BMs of our sample had not be randomly selected, in fact they had been selected with high influence of our network and our research method. Therefore, we cannot aim to a high generalizability of this research. The choice has been influenced by our connection and our focus.

Secondly the study is mostly focused on the organization point of view (functional level) and most of our interviewees (primary data) belongs to the organizations. The results may be affected by this choice.

Thirdly, the findings from the mapping process of sustainability cannot be considered highly scientific. The obtained values are general. This is due to several facts: the numeric value associated to each sustainable aspects (part of the sustainable model); the analysis of the sustainability has been influenced by the lack of information and our objective interpretations of the results.

However, we believed this research mirrors the authors‟ resources and competences.


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Chapter 6: Findings This chapter presents our findings. We show the conclusions of the results and analysis of this research. We start discussing the Short Food Supply Chain in the different organizations, similarities, differences, consequences and challenges that are commonly faced. Then, we describe another important finding on the reproducibility of the BMs. Finally, we review similarities of the BMs in the two different clusters.

6.1 Short Food Supply Chain

Big part of the food waste derives from the inability of reaching the consumer in time or form standard packaging requirement. This leads to expired food which cannot be eaten and, therefore, it is wasted. Many BMs try to organize their operations without buffers. The key to manage it, according to Agrozero (6), is to plan the demand. This generates a de-stress at the beginning of the supply chain. A not accurate demand forecast is a clear origin of unsustainability. Agrozero (6) is working in order to plan the demand from the end of the supply chain, driving then back to the beginning in order not to have buffers and just-in-time deliveries.

In order to comply with this, the digital data management is a successful key.

Other examples are given by El Colletero (3), Grisoxen (5) and CowFunding (4). They are also planning their sellings. They sell the products even before that they had it ready. This is an extreme good example of manage the operations. Nevertheless, it is dangerous because they have some clients‟ dissatisfaction due to the impossibility to perfectly forecast products characteristics. In this way, they manage to eliminate intermediaries, even if the product (meat for example) still needs some processes before reaching the consumers. Therefore, Grisoxen (3) and CowFunding (4) decided to outsource some operations (rather than in globe other parties in the chain).

The de-stressed supply chain is possible to be reproduced in many different organizations. The effect of planning the demand has a double impact on consumers‟ habits. From one side, they need to plan their groceries; from the other side, they have to change their purchase habits (they may need to visit more than one sellers to complete the whole shopping).

An important finding is about the two types of SFSC: short circuit and direct selling. The short circuit has more economies of scope5 ; meanwhile, the direct selling aims more to

5 Economy of scope: decreasing the cost of production or the operative costs increasing the


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economies of scale rather than of scope (or scope within the same range of products. For instance, enlarge the vegetable‟s offerings. but from vegetable the producer will not amply its production to meat, cheese, beans and so on…). Another important consequence is the allocation of overhead costs. Due to the collaboration, the short circuit SFSC (1, 2, 4, 5, 6) shares some of overhead costs (for example the delivery costs). Therefore, they offer a wider range of products and services. Instead, Värpinge (7) or El Colletero (3) cannot afford - for instance- to deliver goods at home (it is very economically and environmentally expensive).

However, in both types of the SFSC, the consumers is socially and physically very close to producers. In fact, both SFSC emotionally involve the consumers (social proximity) with history, information and production method. The physical proximity is due to the local production and distribution.

6.2 The BM reproducibility

The reproducibility of different BMs is highly important for transferring and reproducing the BM in other places with similar conditions. We noticed that there are similar business ideas in different places.

For instance, to decrease bakeries‟ food waste at the end of the day, Karma (B) offers an online platform where bakeries upload their leftovers with large discounts. “Optimiam”, etc…This is because the web-based BM can be easily reproduced in different lands with similar social conditions (Ronca, 2017). Karma is an example of web based organization which is possible to reproduce in different areas with social similarities. Another example is L‟alveare (1). It is a web based BM which has been reproduced in different countries in the Latin European cluster.

As far as the not web based BMs, they can be reproduced using similar structure and development. For example, who wants to reproduce a BM like Trampolin (2) needs to know how it works, the best practices, activities and the networks which facilitate the development of the organizations. In this case, it can be reproduced by using the same structure and by performing the same activities and by adapting them at the environment in which they are operating.

In the other cases, it is necessary to reproduce communities of consumers, suppliers and volunteers (if needed) (1, 3, 7). types of product/services (thus the rage of the offer).


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Other BMs which are only partly based on web solutions (for instance Agrozero - 6), it is partially possible to reproduce them in different places. As stated before (Chapter 5.1 SFSC) in Sweden there is a similar business, but it is running its business just in the summer season. This is due to different climate conditions, which do not allow an easy cultivation.

To sum up, it is easier to reproduce web-based BM. However, just reproducing the BM is not enough. It is recommended to adapt and “translate” the BM in the new social environment. It is necessary to thrive the business in the future.

6.3 BM features: similarities and differences. This thesis wants to compare BMs in two different European clusters. Now we quickly recall the common features in the two clusters. There is a stronger and stronger need of “local food”. In the last years, small and medium food producers are giving a local print to their products. Then small and medium organization tends to be really idealistic rather than business oriented. The stakeholders involved in the organization share these idealistic values. Given the small or medium scale of the organization, their production aims to be more quality oriented rather than quantity oriented. This also reflects also the regional scope the organization wants to reach. Internet is used not to reach distant territory and therefore to enlarge their business. Internet is used for communicating and penetrating the region staying local. Most of the organizations adopt a differentiation strategy. Even if they are slightly different, their strategy wants to underline the higher quality of their food compared to the big large corporations. As far as the differences, we have not remarked any significant differences belonging to a particular cluster rather than the other one. Therefore, our conclusion is that there is not any special BM characteristic belonging to different clusters.

6.4 Reconnection to the purpose

This study has fulfilled its purpose by investigating business models, which have in common the aim to increase the consumption of sustainable food. Moreover, our research wanted to further investigate the triple sustainability. Therefore, we provide a model to evaluate it. The framework can also be used to take inspiration on how improve the sustainability in its triple aspects. Moreover Chapter 4 reports the shared information of the analysed organizations. These information represent available, shared knowledge and experience for now entrance organizations.


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Chapter 7: Conclusion

This chapter reviews the purpose and research questions to conclude if they have been answered. It also summarizes the findings of the study. We also argue the contribution to the existing knowledge and finally we present interesting areas, which need to be further investigated. During the spring semester 2017, we worked on a research project given by Professor Jose P. Garcia. He asked us to find data and information to create a database of reproducible BMs of small and medium food producers who “directly” reach the consumers. This in order to enhance the consumption of sustainable food. Given this topic we developed a RQ (“How do different sustainable business models respond in the Nordic and Latin European Cluster?”). It drives us to develop a SQ1 (“How different business models are triple sustainable?”) in order to identify what a "sustainable organization" is. We discovered a gap in the existing literature study. There is not a model to fully evaluate the sustainability in the food industry. Therefore, we performed a literature study, interviews and write-storming to shape a new framework to evaluate the triple sustainability (social, environmental and economic) (See Appendix D). The model had been tailored for the food industry. We performed an analysis - especially on SFSC and BM's characteristics- in order to reply to the RQ (“How do different sustainable business models respond in the Nordic and Latin European Cluster?”). We noticed that there is no specific characteristic of a determined cluster. Therefore, the geographical region does not influence the BM's design. During our analysis, we contributed to clarify the concept of “local food”, to identify the different types of SFSC and to study the reproducibility of the BM. Moreover, the reported results (Chapter 4) represent the knowledge, data and information shared by the SOs. These represent instance of sustainable BMs that could be reproduced and taken as example for new entrances. We discovered that the geographical region influences the concept of "local food". We defined "local food" is it is produced, processed and consumed within the same geopolitical limits of the region. About the SFSC, we understood and highlighted that they represents a huge potential not only for reducing the waste in the food industry; but also for transforming the whole food industry into a more triple sustainable one. Regarding the BM‟s reproducibility, we discover the differences between the web based organizations and the not web based ones. The first one being easier to reproduce in different places. Anyhow this is not enough because there need to be very similar social conditions. These are the conclusion of our research project. Now we present the contribution to existing knowledge and, finally, we suggest future researches and knowledge gaps which can be fulfilled with future research topics.


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7.1 Contribution to knowledge This project aimed to investigate the - present and future- needs to enhance a more triple sustainable food industry. Moreover, a strong characteristic of this thesis is the attention given to two different geographical regions. In this way, we contribute to see the differences and similarities of two different social systems.

Specifically, we contribute to define the need to design a tailored designed framework to evaluate the triple sustainability for the food industry. This for helping organizations, existing and new, to choose the right activities and operations in order to maximise products‟ sustainability. Furthermore, by creating a general framework to analyse the sustainability of an organization we contribute the general knowledge on sustainability. This framework has as well the scope to influence the people‟s awareness, literature studies and politics decision to create and follow specific criteria for evaluating the organization‟s sustainability.

Our work contributes to define the conception of Local food in different geographic area. Another contribution is the public information about the analysed OSs that increase the availability of information and knowledge regarding this type of sustainable BMs. It allows new entrants to have access to helpful information and knowledge that can be used to start now SO.

7.2 Future work

We suggest future researches to develop a more detailed and general framework to evaluate the sustainability of the organization in all the industries. To do that, the triple sustainability has to be further investigated. Even if we believe our sustainability model is complete (it touches the economic, environmental and social sustainability in different aspects); new and different voices and aspects could be found and adapted to different industries; the numbers associated to each task can be further investigated and therefore made more reliable and more generalized to be applied to all the industries. Connecting and officially recognizing the sustainability framework will enhance the sustainability.

Moreover, we believe it is interesting to investigate the community of consumers and their relationships within the food industry. This due to the different food‟s role and human approach in the two different clusters.


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WEB SITES:

European union sustainable goals: http://ec.europa.eu/eurostat/documents/3217494/7745644/KS-02-16-996-EN-N.pdf/eae6b7f9-d06c-4c83-b16f-c72b0779ad03 ISO 14000: https://it.wikipedia.org/wiki/ISO_14000 Autor D, (2016), "Will automation take away all our jobs?", Retrieved from: https://www.ted.com/talks/david_autor_why_are_there_still_so_many_jobs?

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La matriz del bien comun: www.economia-del-bien-comun.org, [email protected]. Economy of the common good: https://old.ecogood.org/en/ PoliBuscador: http://polibuscador.upv.es/primo_library/libweb/action/search.do Articles about sustainability characteristics:

http://www.ccsenet.org/journal/index.php/jms/article/viewFile/33518/20891

Monica Orrigo ( 2016) , Top 10 Food Industry Trends for 2016, handshake blog, https://www.handshake.com/blog/food-industry-trends/ Tristram Stuart,https://www.tristramstuart.co.uk/default.html, https://www.ted.com/speakers/tristram_stuart

Here are reported the website of the different analysed organizations.

# Organization Reference Web-site

1 L‟alveare https://alvearechedicesi.it/it/p/index

2 Trampolin http://www.trampolinsolidario.org/quienes-somos.html

3 El Colletero https://www.facebook.com/ElColletero

https://it.wikipedia.org/wiki/ISO_14000



https://old.ecogood.org/en/

http://polibuscador.upv.es/primo_library/libweb/action/search.do

https://www.handshake.com/blog/food-industry-trends/



https://www.ted.com/speakers/tristram_stuart


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4 CowFunding http://cowfunding.se/om-cowfunding/

5 Grisoxen http://www.grisoxen.se/

6 Agrozero http://www.biella.agrozero.it/dnn/

7 Värpinge https://www.facebook.com/VarpingeGronGardsbutik/

A Bondens http://bondensegen.com

B Karma https://karma.life

C Zolle http://www.zolle.it/web/partecipare-a-zolle/

REPORT and CONFERENCES Fusion, (2016), "Estimates of European food waste level". Fusion is supported by Euroean community's seventh Framework Program under Great Agreement n 311972 Brundtland commission, 1987, World Commission on Environment and Development (WCED).

http://cowfunding.se/om-cowfunding/


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Appendix

Appendix A: Justification of countries in different clusters We here report our justification in the countries´selection for the two different clusters.

Nordic Cluster Here we report the previous findings.

Source




Hofstede (1976)



Hofstede (1980)

Nordic

Denmark Germany Norway Sweden



Denmark Norway

Denmark Finland Norway Sweden

Denmark Finland Norway Sweden Netherlands

In table 2 we analyse the general presence of the country in the Nordic cluster.

Country Defined as Nordic (out of 6 researches) Percentage

Denmark 6 100% Norway 6 100% Finland 4 67% Sweden 3 50% Germany 1 16,6% Netherlands 1 16,6%

Out of this result we decided that our Nordic cluster is composed by: Denmark, Norway, Finland and Sweden.

We decided to eliminate Germany and Netherlands because they are present in just one research out of 5. With an overall presence of 10%, we believe it is not enough to justify the of the country in the Nordic cluster.

Griffeth (1980) and Haire (1966) did not differentiate between the Nordic and the Germanic


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clusters. In both of these researches, the two clusters were combined into a Northern European cluster. This explain the presence of Germany and Netherlands and it justifies even more our decision not to take them into consideration as a part of the Nordic country.

Latin European

Source




Hofstede (1976)



Hofstede (1980)

Latin European

Belgium France Italy Spain

Belgium France

Belgium France

Brazil France Italy Switzerland

Belgium France

Belgium Greece Italy Netherlands Portugal Spain

Argentina Belgium Brazil France Italy Spain

In table 3 we analyse the general presence of the country in the Latin European cluster.

Country Defined as Nordic (out of 7 researches) Percentage

Belgium 6 85,7% France 6 85,7% Italy 4 57,1% Spain 3 42,9% Brazil 2 28,6% Switzerland 1 14,3% Greece 1 14,3% Netherlands 1 14,3% Portugal 1 14,3% Argentina 1 14,3%

So our Latin European Cluster is made up by Belgium, France, Italy and Spain.

The Latin European cluster was the last cluster commonly found. Its most consistent members were France and Belgium (85,7%). Then we decided to include Spain and Italy because they fit in this cluster when they have been considered. This justifies our choice.


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Even though these countries differ in language, they all are variations of the Romance tongue, and religion. Moreover, Belgium was one of the major destination during the Italian emigration in 1900s.


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Appendix B: Interview’s structure for the organization Interviewed organization: Interviewee: Date: Place: ADMINISTRATIVE MATTERS

1. We would like to record the interview to reach a good level of validity and reliability, we hope this is okay with you?

2. You have the possibility to be completely anonymous. Would you like to be anonymous, or we can mention your name on our report?

3. We will lead this interview, which is a semi-structured interview, meaning that if we get into topics that are interesting for our work, but not in the manuscript, we‟re free to follow new tracks. We also want you to feel free to add whatever you feel is relevant to each matter.

PROJECT BACKGROUND A peer student and I are now doing our master thesis. We are interested in the food industry. More specifically we want to analyse how different sustainable small/medium food producers reach end customers according to their needs. This interview is divided in two parts. During the first part, we go through the analysis of the business model. Some parts have been already analysed by us, but we would like to go through it together. During the second part, instead, we have some general questions about your organisation.

BACKGROUND - General questions

- When have you started working with this business? And WHY? - core values and ideas? what do you want to leverage? - Where do you see the organisation in the future?

Business model: Now we will analyse 10 elements which together compose the business model. 1.General features: What you would say about your business model? why is working well if you have to choose between the follow aspects: resource efficiency? good network between clients and suppliers? or due to the perceived value of the clients?


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2.Value proposition. Which is the offer of your organization? How do you operate (manage) the product or service? Is there a brand and differentiation policy? (marketing strategy) Which of the follow attributes mirror the offer of your organization?

§ Comfort / Utility Facilitate things or make them more practical. Example: Apple Ipod

§ Accessibility Put products or services available to customers who previously had no access to it.

§ New They satisfy needs that were previously non-existent.

§ Performance improvement Increase the performance of a product.

§ Customization Tailoring products and services to the specific needs for different clients or segments.

§ “Work done” Assist the intermediate customer in certain jobs. Partial outsourcing

§ Design A product can stand out for the superior quality of its design.

§ Brand policy and differentiation Perception of Value by the customer, for the use of the mark.

§ Price Policy Offer similar value at a lower price to meet the needs of the market segments that are governed by the price.

§ Cost reduction Helping customers reduce costs.

§ Risk reduction Reducing risks.

3 Clients: Why customers buy from you? What is the market or the customer target ? (MS) If you have to choose between the follow selected, which of these one you choose?

§ Mass market Business models that focus on the general public and do not distinguish market segments.

§ Market niche Models that serve specific and specialized segments. Frequent models in supplier-customer relationships.

§ Segmented markets Some business models distinguish several


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market segments with slightly different needs and problems.

§ Diversified markets A business model that serves some unrelated market segments with very different needs and problems.

§ Multilateral markets Multilateral platforms. For example: credit cards (Data-base customers and merchants).

What sales channels are used? If you have to choose between the follow selected, which of these one you choose?

§ Sales force

§ Internet sales

§ Own stores § Other Stores

§ Franchising

§ Wholesaler (partner / indirect)

Direct contact network

Institutional partners

Which channel phasing you are mostly focus on: If you have to choose between the follow selected, which of these one you choose?

1. Information How disclose the products and services of our company?

2. Evaluation How do you help customers evaluate our value proposition?

3. Purchase How can customers buy our products and services?

4. Delivery How do we deliver our value offer to customers?

5. Post-sale What after-sales service is offered?


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What types of customer relationships have been established? (ICR) If you have to choose between the follow selected, which of these one you choose?

§ Personal assistance Human interaction.

§ Exclusive personal assistance A customer service representative is dedicated specifically to a particular customer.

§ Self-service The company is limited to providing all the necessary means so that the customers can serve themselves.

§ Automatic services Automatic processes for self-service.

§ Communities Communities of users to deepen the relationship with customers.

§ Collective creation Customer collaboration to create value.

4. Revenue model: What are the main sources of income?

§ Asset sales

§ Usage fee

§ Subscription fee

§ Loan / rental / lease

§ Licensing

§ Brokerage expenses

§ Advertising

What is the pricing policy? dynamic or fix? What structure of intermediate and final margins does the company have? 5 Resources / Assets (R): What is the structure of the staff of employees/participants? (in terms of numbers and


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organization) What profiles and competences do the employees have? What types of Assets and Technology does the company count on? Do the organization share their resources? 6 Costs What are the most important costs inherent to the business model? If you have to choose between the follow selected, which of these one you choose?

§ Low Cost models The goal of cost-based business models is to cut costs wherever possible.

§ Value creation models Premium value propositions and personalized services.

What cost structure is used in the company? If you have to choose between the follow selected, which of these one you choose?

§ Fixed Costs Those that do not change according to the volume of goods or services produced.

§ Variable Costs They change in direct proportion to the volume of business.

§ Economies of scale Cost advantages that a company obtains as its production grows. The average cost per unit decreases as production increases.

§ Economies of scope Cost advantages that a company obtains as it broadens its action scope

7. Processes and Activities (AC): What are the organization daily activities? can you describe them? What are the main processes that define operations? If you have to choose between the follow selected, which of these one you choose?

§ Production Activities related to the design, manufacture, and delivery of a product in


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quantity and quality.

§ Problem solving Activities that imply the search for new solutions to the individual problems of each client. Example: consultancies, hospitals, service companies, etc.

§ Platform / network Key activities related to the platform or network.

What information and communication system is used, and how is it organized? 8. Supplier What kind of suppliers does the company work with and what number? What resources and activities are contracted/outsourced? Suppliers were willing to collaborate and participate? 9. Financing What capital structure does have the company? What fund-raising has been used? What kind of partners are there in the company? 10. Criticism. Which are your main obstacles?(both to grow and for everyday operations) which are the main problem with suppliers? customers? with the logistics? What are the difficulties in order to replicate a similar BM? How do you deal with your direct competitors? STRATEGY

- Do you collaborate with Open Business Model? (i.e. collaborating for the R&D department; sharing your knowledge)

- Where your small company is better than the large food companies?(Viceversa)

Local food:

- what do you consider local?

- how have you chosen your market place ? (geographical one).


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Digital transformation

- what do you have digital? is it in the core? why/why not? Sustainability

- What is sustainable food for you ?

- How do you work with the sustainability?

- Are you analysing the sustainability in order to mirror the value of the organization? - in which sustainable fields do you focus your attention (environmental social or economic)?

which parameters do you consider? Do you have a framework that you apply? Conclusion Thank you very much for your time. Do you want to add something more? Do you have some feedbacks for us? Ok, thanks again for your time, Vittoria & Nicolò


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Appendix C: Template for preliminary BM analysis NAME of the Organization RESOURCES / ASSETS 1. What is the structure of the employee template? 2. What profiles and competencies do the employees that compose it have? 3. What types of Assets does the company have? PROCESSES AND ACTIVITIES 4. What are the main processes that define the operations? COSTS 5. What Cost Structure is there? Personnel costs, Exploitation Costs; Cost of investments and maintenance of assets BENEFIT 6. What structure of intermediate margins, and End, you have ? FINANCING 7. What is the optimal capital structure of the company ? 8. What kind of partners are there in the company? 9. What is its corporate structure? SUPPLIERS 10. What kind of suppliers do you work with? What number of them? CUSTOMERS 11. What is the target market or customer? 12. What sales channels are used? 13. Who are the competitors? FLOWS OF INFORMATION 14. What information system and communication is used and how is organized? PRODUCT / OFFER 15. What is the offer of the company? 16. How is the product or service offered? 17. What is the pricing policy? 18. Is there a brand and differentiation policy?


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Appendix D: The sustainable model. We report the tables of the sustainable model. If you are interested in knowing about a specific organization, you can to email us ([email protected] or [email protected]) asking the table you are willing to have.

Social sustainability

Education

City life Aspects Local economy Retribution/workers aspects

improve food awareness: on health aspects and on production +4

give false (marketing) information to increase unaware consumption -4

decrease dependency resource, differentiate suppliers + 3

high dependency on one big provider -1

creation of different small organizations (differentiation, entrepreneurial spirit) +3

Not support for local entrepreneurship -1

integration people with difficulties +2

all able workers (if organization with more than 15) -2

training program on sustainable solutions +3

no training program -2

increase relationships between city and rural areas +2

decrease relationships/close relationships -3

exchange within the local (regional) +2

integration of social exclusion +3

promote reduction of home waste /home

promote a consumption education -1

Increase city life quality conditions (decrease of stress,

Do not increase city life quality conditions ( decrease of relationshi

short chain of the capital within the local community +2

equal right (within the organization, in terms of democracy and transparency,

discrimination -5




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recycle +2

increase relationships) +3

p) -2 equal distribution of work) +2

Promote a equilibrate healthy diet +2

Promote unhealthy diet -1

Build communities +2

social return on investment +3

empowerment of women and social discrminate (diversity, in different organization level with equal salaries) +4

no diversity - 3

Sharing knowledge and experience +2

capabilities differentiation of employees/organization +1

specialization -1

Rural area life Aspect

Human life Aspects

Food/alimentation Aspect

price politics

local empowerment +3

empowerment outsider -1

increase well being (defined as mental physical and social) + 3

decrease people's well being -3

product certification Fair Trade ,(Organic ) +5

No certification - 2

right price based on cost of production +3

price based on company image/brand - 3

creation of new local working

increase direct relationships and

decrease people's relationships -2

Maintenance of Culture/ tradition

loss of cultural identity -2

price that allow people to afford

Price higher than the market


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place + 3 trust between people +4

+3 quality foods +3

price -2

promotion of the rural area +3

promotion of urbanization -1

inclusion +2

exclusion - 1

gastro diversity +3

lower gastro diversity - 1

Right remuneration to suppliers +4

Not right remuneration to suppliers -4

promote association of different organizations +2

healthy product +5

unhealthy products - 5

food quality + 5

no quality food -3

Right distribution of the margin over the supply chain +4

training of local people +3

use outside specialized workforce -1

guarantee satisfaction of basic needs of local/global (basic human right) +3

Diversification of food availability + 2

promote personal talent +3

natural local product +5

product form distant -3

tackle poverty and social exclusion +3

exclude and improve poverty -5


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value Communication Etichs

organization policies which add emphasis on the positive aspects of social sustainability + 5

do not have policies which add emphasis on the positive aspects of social sustainability - 5

Give space to communication + 3

Do not give space to communication -1

Consider ethical aspects over economic one + 4

Unethical actions -5

Sharing value and ideology within the organization and stakeholders + 4

pass on the traditions + 3

conforming to globalization -2

Support ethics bancs +4

Not support ethics banks - 4

TOTAL SOCIAL SUSTAINABILITY = ….

Environmental sustainability

Packaging Resource optimization

Waste Pollution

use minimal essential packaging +5

use packaging that are not necessary but for marketing reasons - 4

Share capacity/use full capacity + 4

under capacity utilization -3

decrease waste with resource optimization +5

prevent/cure land pollution + 4

land chemical pollution - 4

packaging used maintain longer pr

packaging do not favourit

circular economy +5

linear economy - 5

facilitate recycle and recovery

increase non recyclable

prevent/cure water pollution + 4

water pollution -4


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oduct +4 e the products conservation - 3

+5 waste -5

use environmental material for packaging +5

use polluted material -5

handle the product shelf life +4

unexpected waste -5

decreasing house waste +5

increase house waste -4

prevent/cure air pollution + 4

air pollution -4

reutilize and repair +5

facilitate and use recovery +5

decrease utilization of chemical product +4

use recyclable material +4

no recyclable material - 4

0 error +4

high presence of unexpected errors -4

moving through 0 waste +4

not calculate the waste -4

low CO2 emission +3

high CO2 emission -5

low packing with low risk of broken products +4

high packing with high risk of broken products - 4

limit the use of natural resources, increase recycle +4

exploit natural resources - 4

promote restructuring and recovery of buildings +4

build new buildings -3

Earth conservation Local environment

global environment Artificial/chemical dependency

Bio-diversity maintenance + 4

bio-diversity decrease -4

no critical alteration of

high influence on the natural

decrease animal product consum

increase animal product consumption -

increase mechanical methods

use of chemical method


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local environment + 1

environment - 4

ption +3 3 +3 s -4

Landscape protection and respect +4

landscape destruction -4

fit within the local condition and natural source +3

use resource from other geographical area -3

decrease overall no sustainable use of resources +4

use of non renewable resources - 4

Use of organic product +4

production with the use of artificial chemical products -4

forestation protection +4

deforestation -4

increase the sustainable use of local resource +4

maintenance of climate equilibrium +4

Use of permaculture +4

increase use of natural agronomy methods +4

use of fertilizer and pesticide -4

Use of abandoned land +2

increase water quality +3

polluted the water -4

selective method of fishing/hunting +3

unselective method of fishing/hunting -3

maintenance of resource by a minimal and efficient

over use of primary resource -4


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use (potable water) +4

Reverse the long-term decline in (animal) populations of farmland and woodland +4

decline the (animal) population of farmland and woodland -4

Territorial revitalization +4

consciousness energy Products transport method

increase people awareness on consumption of sustainable food and on environmental issues + 5

promote no needed demand of unhealthy or unsustainable food -5

use of green energy +5

use of non renewable energy -4

organic + 4

no organic - 4

KM 0 +5

long distance (> 250 km) - 5

creation of energy from waste + 5

fresh +4

no fresh, processed food. - 3

local transport (<250km)+4

organization policies & values

do not have

decreasing the

waste of

vegan or

neither vegan

transport optimiza

no optimiza


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that help emphasis the positive aspect of environmental sustainability + 4

policies & values that cover these aspect - 4

energy consumption + 4

energy -4

vegetarian (low resource impact) + 4

nor vegetarian - 2

tion (sharing goods moving)+ 5

tion of transport - 5

use of energy in smart hours + 3

seasonal +5

non seasonal - 4

use of non polluted transport method +5

use of highly polluted transport -4

sustainable raw material (provided from a sustainable supply chain)+ 4

limited distance between raw material, production and consumption +5

long distance between production and consumption -5

promote animal welfare + 5

Do not promote animal welfare - 5

TOTAL ENVIRONMENTAL SUSTAINABILITY= ….

Economical sustainability


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Costs time BM characteristics investment

lower cost of production and sell due to lower use of resource +3

higher cost than bigger economy - 1

reduce production and selling time +3

return on capital and on social activities +4

No return on capital and on social activities -4

lower overall cost lowering intermediaries number +4

high impact of logistics costs -4

decrease lead time +3

increase lead time - 4

auto maintenance from an economical point of view +4

dependence from investments, donations or subventions -4

investment risk diversification +4

overall costs to be sustainable lower of the 15% of the cost of the products (percentage that people are willing to pay for a sustainable product) +3

minimize the stock presence +4

Circular economy +5 (lower waste and use of resource and lock in of consumers)

No circular economy -4

access to public subsidy +3

rely on public subsidy -3

efficiency +5

high utilization of resource -3

high return on capital for investors +2

low return on capital for investors -1


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Demand sharing use IT system

innovation

direct demand/no intermediaries +5

presence of intermediaries -4

utilize shared information + 3

increase efficiency + 4

new products +3

no new products - 2

lock-in effect, +4

share assets, capacity +4

increase communication capabilities + 4

new technologies/process increase efficiency +4

no use of new technologies to increase efficiency and communication -3

consumers active part of the supply chain +4

consumer passive part of the supply chain - 3

sharing value among stakeholder +4

E-commerce that increase market space and visibility +4

research and development on sustainability aspects +4

no research and development on sustainability aspects - 3

clients group +3

No client group - 2

share knowledge and experience +4

not share, keep organization secret -3

products management selling customers

promote product information +4

no provide required information -4

strong and dedicated leadership based on common

week leadership - 3

new ways of selling products +3

customers engaged and participative +3


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value, mission and vision + 4

segmented advertisement +3

not advertisement -1

utilized lean: production and distribution + 3

market diversity +4

focalized on one market -3

loyalty and satisfaction and measure it + 2

Not loyalty and satisfaction -3

collaboration and association+3

diversification of the sales' channels direct selling online selling +3

Just one sales channel - 3

retain customers and assure the products +3

Do not retain customers and assure the products - 3

flexible organization process +3

bureaucratic organization process -3

flat organization + 2

hierarchic organization - 2

TOTAL ECONOMIC SUSTAINABILITY = …. TOTAL TRIPLE SUSTAINABILITY (tot social + tot environmental + tot economic) = ….

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