Sustainable Food and Fibre Supply chains - What’s missing? : Impediments and Drivers from a Consumer Perspective
Human Ecology Program, The Fenner School, Australian National University
This paper outlines results from the RIRDC supported Greening EMS project which builds on findings from previous studies related to extension of EMS to a supply chain approach (e.g. Eco-range and Enviro-Meat).
Focusing on farms in Western Australian implementing the BestFarms EMS, the Greening EMS project explores the tensions between ‘sustainability’ values found amongst supply chain actors for ten supply chains (including wool, wine, grain, horticulture and milk). Drivers and barriers to social, environmental and economic sustainability were examined at the farming, manufacturing, warehousing, transportation, and retail and consumer stages. A number of tangible drivers and impediments to the transfer of sustainability values between producers and consumers were identified. This paper describes the consumer survey part of supply chain analysis.
‘Green’ buyers were targeted for consumer research because they are the most likely to drive demand of environmentally friendly products. Consumers were asked what influenced their food and fibre purchases. When values were looked at individually, price was the most important for both conventional and organic consumers. However, when first and second preference were combined, as would be expected when consumers are making choices based on multiple values held, environmentally friendly rose above price as the most important value, especially for organic consumers. Gender differences were also noted. Results on consumer preferences were consistent with other consumer studies.
A model of sustainable consumption that considers the social context and interaction between core elements of product availability, social norms and lifestyle practices is also explored. This paper outlines a range of issues from the consumer perspective that must be addressed within an integrated sustainable supply chain approach.
The Greening EMS project investigated opportunities and impediments for agricultural industries to implement whole of supply chain environmental sustainability systems enabling progression from producer EMS or other sustainability systems (e.g. organic certification) to whole of supply chain approaches to sustainability.
This was achieved through assessing sustainability values at all steps of the supply chain for 5 selected commodities (10 supply chains), half of which were certified (organic certification and EU Ecowool) and half which were not. Interviews were held with all supply chain actors to determine the level of environmental value transference through all steps of the supply chain including consumers. A key research question was concerned with the ability of environmental certification systems to capture these values.
There were varying levels of value transference amongst the case studies. Results from assessment of value transfer are represented briefly below in order of level of value transference. The certified supply chains showed a much greater ability to transfer values.
Level of value transference
Biodynamic Bread case study
Organic Wine case study
Organic strawberries case study
Organic milk products case study
European Ecowool case study
Wine case study
Conventional Wool case study
Conventional Strawberries case study
Conventional Milk case study
Conventional grain case study
Table 1: Levels of value transference in supply chain case studies
Contributing factors to generation of a high value transference included: strong supply chain relationships based on personal contact and shared values; farmer driven and customer focused approaches and strong environmental and social values held both farmers and consumers associated with that chain.
A common theme was that whilst environmental and social values were important to farmers and consumers, this focus was often missing amongst the middle chain actors (warehousing, manufacturing, transport and retail) particularly conventional (non-certified) chains.
Using the product as a ‘vehicle’ of these values, it appears that often the sustainable values of the on-farm product were not transferred between farmers and consumers. This paper details the how values were or were not transferred in these supply chains from the consumer perspective.
Much of the research into sustainable or green consumption has focused on the role of labelling for environmental and social values and consumer preparedness to purchase products labelled as such. This research has generally targeted individual consumers and has not necessarily been integrated into a whole of supply chain perspective, nor a wider socio-economic perspective, although demographics such as income, age and gender are commonly incorporated (Gordy 2002, Brickley 2002, Howard & Allen 2006, Teisl, M, Roe, B & Levy, A, 2002)
This research demonstrates that whilst freshness, taste and price, remain the primary consumer issues when deciding on a product (Barstow, 2002), there is an emergent theme related to interest in environmental and social values in food and fibre including environment, human rights, animal rights and locally grown (Gordy, L 2002, Brickley, C 2002, Barstow, 2002) .
A number of US studies into consumer preferences (Gordy, 2002, Brickley, 2002) show that the attitudes, values and demographics of consumers have an affect on seeking and purchasing products with ecolabels. Exploration into who is purchasing eco-friendly produce undertaken by the U.S Harvest Cooperative found that increased awareness and desire to know more about the impacts of the production cycle is driving the need for alternative food sources (Brickley, 2002).
In terms of the effect of demographics on green purchasing, Brickely (2002) found that approximately 50% of the cooperative customer base are highly educated. In contrast, Barstow (2002) suggests that the white middle class are no longer the primary markets for ‘ethical products’ with higher percentages of Asian and African Americans choosing them. She also found that 18-24 year olds also showed a strong preference for ethical products.
Barstow (2002) also found that US consumers increasingly prefer local and small-batch products with farmers markets growing by 60% per annum. If growth in farmers markets is a measure of preference for local, then this trend towards local preference is also being demonstrated in Australia, with an estimation of Australian farmers markets turning over at least $1 million per week (The Land, 14 Dec 2006).
Howard & Allen (2006) undertook a survey of 1000 households in California. Amongst the environmental and social consumption values they researched, they found that humane treatment was the most important, followed by local origin followed by living wage requirements. They also discovered minor differences to ordering of preferences related to gender and age differences. They did not specifically examine environmental values in purchasing however their work establishes an argument for labelling based on environmental and social criteria in response to the desire for consumers to know more about these values. They make recommendations for methods to either incorporate this labelling into existing organic certification schemes or develop a new system.
A study undertaken on consumers of the EMS certified Gippsland Beef product (Roberts, 2004) found that many consumers “felt that a sticker something like that used by the heart foundation, would be useful and appreciated. They were also supportive of the idea of the product being audited by an external body”. Results of this survey showed some recognition of EMS (and a preference for ‘EMS meat’) though as this recognition increased during the time of the study, this recognition may be a result of the Gippsland Natural marketing campaign.
A study undertaken focusing on the King Island EMS products, found that 71% of the sample interviewed were sometimes influenced by environmental issues in their purchases and 37% were often influenced (Brand DNA, 2005).
Regarding the tension between price and environmentally friendly produce, research conducted for the Eco-range EMS beef project found that 50% of European and US consumers would prefer environmentally friendly beef at the same price whilst their Australian case study showed a figure of 22%. The reasons for Australia’s reluctant trend in this area need to be understood in the wider socio-political context. This is not well elaborated in the literature on green consumption.
Southerton, Van Viet and Chappells (2004) suggest that the contemporary understanding of consumption is still rooted in an individualist paradigm, “..where drivers and mechanisms are seen to boil down to a matter of individual choice”. They critically analyse the OECD focus (e.g. in their ‘Towards Sustainable Household Consumption’ report OECD, 2002) on per capita income levels and social and economic decisions of individuals or households. They suggest that this individualistic focus has led to a “particularly restricted view of the processes through which consumption is constructed and evolves”. They go on to say that this “fails to appreciate the socially situated and socially structured nature of consumption” (ibid).
In considering consumers as part of the supply chain, the methodology of the Greening EMS study recognizes consumers as actors embedded in complex social relationships and interactions. It observes them in their (albeit often disempowered) role as a major feedback mechanism in the production to consumption cycle. Again to quote Southerton et al (2004), “production configures consumption and consumption configures production”.
Southerton et al (2004) suggest that it may be necessary to look beyond the immediate demographics and to explain why people do and don’t engage in sustainable consumption. Southerton et al (2004), Spaaregaren (2004) and Warde (2004) emphasise the need to look beyond the individual choice and suggest a model of investigating sustainable consumption that considers wider societal influences, systems of provisions and social practices (or lifestyles) to better understand the drivers and barrier to sustainable consumptions.
Methods to determine consumer attitudes to environmental and social values related to the case study food and fibre products included interviewing people at the point of purchase, holding a forum and interviewing people at selected events likely to attract ‘green’ purchasers.
Best practice “green” purchasers were selected because as well as being the most information rich on the topic, they are the most likely to drive demand of environmentally friendly products. Also the awareness or lack of awareness amongst this grouping gives an indication of a best case scenario in terms of sustainable consumption.
The Buying Green Conference in Perth in May 2006 provided an opportunity for consumer research in a forum where participants were likely to be sympathetic to ‘green’ food and fibre products. Using a context of a display of sustainable products (including case study products and other organic, fair trade and ecolabled products), participants at the conference were given 10 minute interviews regarding attitudes to ‘green’ products. Participants at the Food Consumption and Production Conference held at the University of WA in August 2006 and the Blackwood River Festival in Bridgetown in 2004 were also interviewed. In addition to this, consumer interviews were conducted at shopfronts selling case study products.
A focused ‘Food for Thought’ forum was held in May 2006 to further the debate and further consider emerging theories. This event was specific in its objectives to allow interaction between supply chain actors. The forum was held as an Open Space Technology forum where participants were asked to set the agenda. Held in partnership with the WA Conservation Council, this forum attracted 50 people from a diverse range of interests. The forum was attended by farmers and consumers and the dialogue between them was recorded.
Techniques including product displays and presentations, product ‘tastings’ and promotion of existing schemes (e.g. the Blackwood Basin Group’s BestFarms EMS project and the WA Dept of Agriculture’s Farming for the Future) were employed to build the scenario of a broad environmental endorsement scheme in which to assess consumers attitudes.
As part of the consumer research design, the idea of catering using sustainably produced foods was put to the organizers of the WA Buying Green conference. For this a list of green produce across Australia was developed. Requests for this were sent out to Environmental Management Systems practitioners. There were very few results indicating the lack of connection between EMS and ‘green’ marketing. Conference organizers were willing to provide ‘sustainable’ produce but the concept was inhibited by a lack of supply and the lack of an endorsed process.
Approximately the same number of both genders was interviewed with men being 49% and women being 51% of the case study consumers. Of the consumers interviewed 61% identified as buying eco-labelled now (fair trade, organic etc) and 23% said they did not purchase eco-labelled products. Of the 61% of ‘ecolabel’ consumers only a minority would be purchasing exclusively organic or ecolabeled products. Age and location demographics are shown below.
No age given
Figure 2: Age of interviewees
Consumers were interviewed using open-ended questions regarding their purchasing behaviour followed by more specific questions focusing on environmental and social values. They were also given a list of product values to rank (environmentally friendly, locally supportive, price, small business, minimal transport, workers rights, animal welfare and ‘other’). People were also asked what was most important to them generally.
The following graphs show the results of the ranking of values. These are presented as a pyramid of needs with the most important value providing a basis for other decisions. When preferences were looked at individually, price was the most important for both conventional and organic consumers.
Figure 3: first preferences – all consumers interviewed
Figure 4 : First preferences, ecolabel consumers compared to conventional consumers.
When ecolabled and conventional consumer results where separated, there was no re-ordering of the “pyramid” however there were some significant differences in values with only 2.2 % of the organic consumers preferring price over environmentally friendly.
When first and second preference were combined, as would be expected when consumers are making choices based on multiple values held, environmentally friendly rose above price as the most important value for the consumers who identified as purchasing ecolabeled products. Conventional consumers retained the same order with first and second preferences combined.
Figure 5 : First & second preferences combined, ecolabel consumers compared to conventional consumers.
These results basically indicate that a large number of the consumers who chose price as their first preference also chose environmentally friendly as their second preference.
Gender differences were also noted with the order of preferences being reordered by women to favour animal welfare over workers rights. This is consistent with other studies (e.g. Howard & Allen 2006).
Figure 6: Women versus men consumer preferences (first preferences only)
As for Barstow (2002) age does appear to play a role in preferences for environmentally friendly products with the tendency to choose environmentally friendly as first or equal first preference decreasing with age. There was a strong tendency amongst the older interviewees (55-70) to choose local as first their preference. Howard and Allen (2006) also found that increasing age was associated with choosing local.
Figure 7 : First preferences by age
The relationship between work type and preferences has not been fully examined, however 50% of interviewees working in the environmental field chose environment as their first preference and 40% of them chose environment as their second preference, showing a stronger trend in this than any other work type.
Key themes that emerged from conversations with the interviews include:
Of the consumers interviewed 74% said they would find an environmental label helpful. As for the Enviro-meat study (Roberts, 2004), a common suggestion was for a green tick along the lines of the heart foundation. EMS was not mentioned by any consumers although on-farm Best Management Practices and other processes were mentioned by a few.
Consumers interviewed were concerned about finding the balance between what is good for them and what is good for the environment. Many saw a relationship between their own health and the health of the environment. There was also some conflict with buying local as some people recognised social benefits in supporting overseas markets. Issues relating to human health often did outweigh environmental issues including concern about additives, sugar and fats.
Convenience both in accessing food and judging its environmental and social merits were strong themes. Most people wanted to just trust environmental and social claims on product marketing through a trusted and known symbol. However some wanted to be able to at least once research the claims more thoroughly. A website to enable this was mentioned frequently. People not inside the organic network complained that sustainable food is difficult to find.
Consumers ranged from being cynical about logos and marks to being very trustful. Generally people don’t know the organic logos by symbol or name, even those consumers who actively sought organic had difficulty with recognition of these logos. There was greater recognition of the Fair Trade logo than any of the organic logos. This suggests a possible difference in marketing or recruiting value interest.
People attached a lot of values to ‘sustainable’ products in addition to environmentally friendly including no preservatives, healthy and tasting better. ‘Good for the environment’ was clearly linked with less chemical use to many interviewees. However organic was not necessarily assumed to be sustainable. This is a key message for case study organic producers who generally appeared to take it for granted that their products are sustainable and would be seen as such. In contrast when people were asked if they consumed sustainable products many did mention organic. The differentiation between organic and sustainable was unclear to many. This confusion is commonly reported in the literature (Pahl 2003, Cary et al 2004).
People have high expectation of sustainable products. For example an attendee at the Food Symposium said they would involve “sustainable methods of farming, eco-friendly packaging, limited logistics and a stable industry”. A number of interviewees mentioned the supply chain such as one who said that sustainable products would be “produced as part of an adaptive learning process or chain seeking to reduce environmental impacts throughout”. It appeared that customer loyalty would be offered more to environmentally friendly products.
When they were questioned on core values, no interviewees mentioned wealth and money as the most important thing to them. Family significantly dominated with wellbeing and environment coming second in what’s generally important to people. Given that decisions to purchase eco-friendly food are often emotionally based (Brickley, 2002), understanding peoples core values is an important key to understanding ‘green’ purchasing behaviour.
Consumers appeared to fall into three categories in regard to levels of concern relating to environmental and social values in food and fibre products:
There were clear differences in the conventional and ecolabel / organic purchasing customers with the latter having a better understanding of where to source ‘sustainable’ foods. It is also likely that they are more integrated into a social grouping that supported purchasing of ‘green’ products. Workers in the environmental field who tended towards environmentally friendly products also share this social network of support to ‘buy green’.
Southerton, Chappells and Van Vliet (2004) argue for a less individualistic and more systems based approach to understanding consumer motivations and actions relating to sustainable consumption. Their model of sustainable consumption uses social practice (e.g. peer group support or pressure), normative behaviour (e.g. wider societal pressure to conform) and systems of provision (eg product availability, accessibility and affordability) to explain the drivers and barriers to sustainable consumption. The difference between the conventional and ecolabel consumers can be seen using this model with the latter being part of a social practice that tends towards buying green.
This model implies that provision (e.g. of ecolabeled or EMS products) alone will not suffice to increase consumption of ‘green’ products. That is, while access and convenience are primary, marketing and promotion of green products will require an understanding of the interaction between provision, lifestyle and wider social pressures.
Consumption is embedded within the socio-economic system of the supply chain as well as within the wider social system of socio-economic and political influences. When interactions within the supply chain prior to consumption focused on sharing environmental and social values, these case study products were more likely or transfer these values to the consumer. The biodynamic bread case study is an example of this, with consumers of this product generally sharing the values of the farmer in terms of social and environmental sustainability. (Interaction between supply chain actors in the ten case studies is to be more fully explored in a forthcoming RIRDC publication).
There is little argument that wider socio-economic and political influences have an effect on consumer preferences though there is limited Australian literature relating to the impacts of this on sustainable consumption. Lack of Australian government policy on sustainable consumption demonstrates a lack of unified national consciousness on sustainable consumption issues. Social influences also manifest in the differences found in gender and age group with different social norms and practices applying to these groupings.
In relation to consumption of EMS products, social systems need to be considered to bring consumers into a whole of supply chain approach to sustainability. This involves the development of whole of supply chain approaches to sustainability, though achieving commitment to environmental and social sustainability and the transfer of these values at all stages of the chain (as opposed to a focus primarily at the farm stage).
In summary, consumers who are generally willing to give preference to environmentally friendly, humane and socially sustainable products are inhibited by a long list of impediments including availability and accessibility of ‘sustainable’ products, lack of mechanisms for transfer of sustainability values along the supply chain, lifestyle choices that do not necessarily support green purchasing and wider social norms (particularly in Australia) that infer that green purchasing is unconventional behaviour.
Three key learnings:
1. Developing a framework for extending EMS on farm to a whole of supply chain approach
EMS is unlikely to work as an environmental assurance process for the rest of the supply chain, specifically consumers, where it is separated from a process involving all supply chain sectors. Without this approach, there is no feedback loop and no opportunity to incorporate consumer and other supply chain actors in the sustainability process. Implementing an EMS on independent farms, factories and shops is unlikely to achieve value transference without a whole of supply chain approach. Consumers are not interested in EMS per se. EMS was not raised as an issue by consumers however they were concerned with and aware of eco-labelling. Consumers also showed little interest or understanding of natural resource management issues on farm such as wildlife, vegetation and water quality. They were primarily concerned with chemicals as an environmental and a health issue.
2. To achieve value transference, the certification systems needs to be a food or product based system rather than a farm certification system
Value transference is reliant on product exchange. It is the exchange process that carries the values. It requires communication of farmer held values to the consumer. Consumers are not generally concerned about values in the ‘middle’ of the supply chain. Environmental performance needs to be built into product ‘specifications’.
3. Consumer demand, or lack of demand for ‘green’ products need to be understood in the wider social context
Rather than viewing consumers as fully independent individuals with clear choices, a better understanding of their motivations can be reached through considering their immediate and wider social context as well as the socio-economic context of the supply chain.
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The Land, 14 Dec 2006 - City Slickers Love it Farm Fresh
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