Trust and governance of global value chains: The case of a Brazilian beef processor

Purpose - The purpose of this paper is to offer an exploratory case study comparing one Brazilian beef processor's relationships supplying two different distribution channels, an EU importer and an EU retail chain operating in Brazil. Design/methodology/approach - The paper begins with a short review of global value chains and the recent literature on trust. It gives the background to the Brazilian beef chain and presents data obtained through in-depth interviews, annual reports and direct observation with the Brazilian beef processor, the EU importer and the retailer. The interviews were conducted with individual firms, but the analysis places them in a chain context, identifying the links and relationships between the agents of the chains and aiming to describe each distribution channel. Findings - Executive chain governance exercised by the domestic retailer stimulates technical upgrading and transferring of best practices to local. suppliers. Consequently, this kind of relationship results in more trust within the global value chain. Practical implications - There are difficulties and challenges facing this Brazilian beef processor that are party related to the need to comply with increasingly complex and demanding food safety and food quality standards. There is still a gap between practices adopted for the export market and practices adopted locally. The strategies of transnational retailers in offering differentiated beef should be taken in account. Originality/value - The research outlines an interdisciplinary framework able to explain chain relationships and the kind of trust that emerges in relationships between EU importer/retail and a developing country supplier.

Importance of mycotoxins in food and feed in India

Various food and feed samples including groundnut seed, maize, sorghum, soyabean cake, groundnut cake, cotton cake, poultry feed, buffalo milk, cow milk and milk powders were collected from farmers' fields, farmer's stores, oil millers storage, traders' storage, retail shops and supermarkets. More than 2000 samples were analysed by ELISA and most of the commodities, with the exception of sorghum seed, contained high levels of aflatoxin. Groundnut cake was one of the major cattle feed ingredients in the peri-urban area of Hyderabad (Andhra Pradesh, India) and >75% of the samples contained >100 µg/kg aflatoxin, leading to a high level of aflatoxin M1, in milk samples. Strategies to reduce aflatoxin levels (especially in groundnut) by management interventions at preharvest, harvest and storage, are discussed.

Regulated irrigation of woody ornamentals to improve plant quality and precondition against drought stress

Regulated irrigation has the potential to improve crop quality in woody ornamentals by reducing excessive vigour and promoting a more compact habit. This research aimed to compare the effectiveness and the mode of action of two techniques, regulated deficit irrigation (RDI) and partial root drying (PRD), when applied to container-grown ornamentals through drip irrigation. Results showed that RDI and PRD reduced growth in Cotinus coggygria 'Royal Purple', but in Forsythia x intermedia 'Lynwood', significant reductions were recorded only with RDI. Physiological measurements in Forsythia indicated that reductions in stomatal conductance (g(s)) occurred in both treatments, but those in the RDI tended to be more persistent. Reduced g(s) in PRD was consistent with the concept that chemical signals from the root can regulate stomatal aperture alone; however, the data also suggested that optimising the growth reduction required a moderate degree of shoot water deficit (i.e. a hydraulic signal to be imposed). As RDI was associated with tissue water deficit, it was used in a second experiment to determine the potential of this technique to precondition container-grown plants against subsequent drought stress (e.g. during retail stages or after planting out). Speed of acclimation would be important in a commercial context, and the results demonstrated that both slow and rapid imposition of RDI enabled Forsythia plants to acclimate against later drought events. This article discusses the potential to both improve ornamental plant quality and enhance tolerance to subsequent adverse conditions through controlled, regulated irrigation.

The British ‘failure’ that never was? The Anglo-American ‘productivity gap’ in large-scale interwar retailing—evidence from the department store sector

Interwar British retailing has been characterized as having lower productivity, less developed managerial hierarchies and methods, and weaker scale economies than its US counterpart. This article examines comparative productivity for one major segment of large-scale retailing in both countries—the department store sector. Drawing on exceptionally detailed contemporary survey data, we show that British department stores in fact achieved superior performance in terms of operating costs, margins, profits, and stock-turn. While smaller British stores had lower labour productivity than US stores of equivalent size, TFP was generally higher for British stores, which also enjoyed stronger scale economies. We also examine the reasons behind Britain's surprisingly strong relative performance, using surviving original returns from the British surveys. Contrary to arguments that British retailers faced major barriers to the development of large-scale enterprises, that could reap economies of scale and scope and invest in machinery and marketing to support the growth of their primary sales functions, we find that British department stores enthusiastically embraced the retail ‘managerial revolution’—and reaped substantial benefits from this investment.

Small business lease reform - can the UK learn from the Australian experience?

This paper addresses the commercial leases policy issue of how to deal with small business tenants. The UK has adopted a voluntary solution to commercial lease reform by using Codes of Practice which is in contrast to the legislative approach adopted by Australia to attempt to solve its perceived problems with small business retail tenancies. The aim of the research was to examine the perceptions of the effectiveness of the legislation in Australia and discuss any implications for the UK policy debate. The research used a combination of literature and legislation review and a semi structured interview survey to investigate the policy aims and objectives of Australian Federal and State Governments, identify the nature and scope of the Australian legislation and examine perceptions of effectiveness of the legislation in informing small business tenants. The situation is complicated in Australia due to leases being a State rather than Federal responsibility therefore the main fieldwork was carried out in one case study State, Victoria. The paper concludes that some aspects of the Australian system can inform the UK policy debate including mandatory information provision at the commencement of negotiations and the use of lease registrars/commissioners. However, there are a number of issues that the Australian legislation does not appear to have successfully addressed including the difficulties of legislating across partial segments of the commercial property market and the collection of data for enforcement purposes.

Small business legislation in Australia: does it provide a solution to part of the UK lease reform debate?

This paper addresses the commercial leases policy issue of how to deal with small business tenants. The UK has adopted a voluntary solution to commercial lease reform by using Codes of Practice which is in contrast to the legislative approach adopted by Australia to attempt to solve its perceived problems with small business retail tenancies. The major aim of the research was to examine the perceptions of the effectiveness of the legislation in Australia and discuss any implications for the UK policy debate but the results of the research also raise questions for the Australian regime. The research used a combination of literature and legislation review and a semi structured interview survey to investigate the policy aims and objectives of Australian Federal and State Governments, identify the nature and scope of the Australian legislation and examine perceptions of effectiveness of the legislation in informing small business tenants. The situation is complicated in Australia due to leases being a State rather than Federal responsibility therefore the main fieldwork was carried out in one case study State, Victoria. The paper concludes that some aspects of the Australian system can inform the UK policy debate including mandatory information provision at the commencement of negotiations and the use of lease registrars/commissioners. However, there are a number of issues that the Australian legislation does not appear to have successfully addressed including the difficulties of legislating across partial segments of the commercial property market and the collection of data for enforcement purposes.

Are property agents to blame for upward only rent reviews?

In negotiating commercial leases, many landlords and tenants employ property agents (brokers) to act on their behalf; typically these people are chartered surveyors. The aim of this paper is to explore the role that these brokers play in the shaping of commercial leases in the context of the current debate in the UK on upward only rent reviews. This role can be described using agency theory and the theories of professionalism. These provide expectations of behaviour which show inherent tensions between the role of agent and professional, particularly regarding the use of knowledge, autonomy and the obligation to the public interest. The parties to eleven recent lease transactions were interviewed to see if the brokers conformed to the expectations of agency theory or professionalism. Brokers that acted for industrial and office tenants behaved as professionals in using their expertise to determine lease structures. However, those acting for landlords and retail tenants simply followed instructions and behaved as conduits for their clients, a role more usually associated with that of an agent within the principal-agent relationship. None of the landlords’ brokers saw themselves as having responsibilities beyond their clients and so they were not promoting the discussion of alternatives to the UORR. The evidence from these case studies suggests that agents are not professionals; to behave entirely as an agent is to contradict the essential characteristics of a professional. While brokers cannot be held entirely responsible for the lack of movement on the UORR, by adopting predominantly agent roles then they must take some of the blame. However, behind this may be a much larger issue that needs to be explored; the institutional pressures that lead to professionals behaving in this way.

The management of positive inter-store externalities in shopping centres: some empirical evidence

In enclosed shopping centres, stores benefit from the positive externalities of other stores in the centre. Some stores provide greater benefits to their neighbours than others – for example anchor tenants and brand leading stores. In managing shopping centres, these positive externalities might be captured through rental variations. This paper explores the determinants of rent – including externalities – for UK regional shopping centres. Two linked databases were utilised in the research. One contains characteristics of 148 shopping centres; the other has some 1,930 individual tenant records including rent level. These data were analysed to provide information on the characteristics of centres and retailers that help determine rent. Factors influencing tenant rents include market potential factors derived from urban and regional economic theory and shopping centre characteristics identified in prior retail research. The model also includes variables that proxy for the interaction between tenants and the impact of positive in-centre externalities. We find that store size is significantly and negatively related to tenant with both anchor and other larger tenants, perhaps as a result of the positive effects generated by their presence, paying relatively lower rents while smaller stores, benefiting from the generation of demand, pay relatively higher rents. Brand leader tenants pay lower rents than other tenants within individual retail categories.

Forecasting UK real estate cycle phases with leading indicators: a probit approach

This paper examines the significance of widely used leading indicators of the UK economy for predicting the cyclical pattern of commercial real estate performance. The analysis uses monthly capital value data for UK industrials, offices and retail from the Investment Property Databank (IPD). Prospective economic indicators are drawn from three sources namely, the series used by the US Conference Board to construct their UK leading indicator and the series deployed by two private organisations, Lombard Street Research and NTC Research, to predict UK economic activity. We first identify turning points in the capital value series adopting techniques employed in the classical business cycle literature. We then estimate probit models using the leading economic indicators as independent variables and forecast the probability of different phases of capital values, that is, periods of declining and rising capital values. The forecast performance of the models is tested and found to be satisfactory. The predictability of lasting directional changes in property performance represents a useful tool for real estate investment decision-making.

“Financial alchemy” or a zero sum game? Real estate finance, securitisation and the UK property market

Following the US model, the UK has seen considerable innovation in the funding, finance and procurement of real estate in the last decade. In the growing CMBS market asset backed securitisations have included $2.25billion secured on the Broadgate office development and issues secured on Canary Wharf and the Trafford Centre regional mall. Major occupiers (retailer Sainsbury’s, retail bank Abbey National) have engaged in innovative sale & leaseback and outsourcing schemes. Strong claims are made concerning the benefits of such schemes – e.g. British Land were reported to have reduced their weighted cost of debt by 150bp as a result of the Broadgate issue. The paper reports preliminary findings from a project funded by the Corporation of London and the RICS Research Foundation examining a number of innovative schemes to identify, within a formal finance framework, sources of added value and hidden costs. The analysis indicates that many of the gains claimed conceal costs – in terms of market value of debt or flexibility of management – while others result from unusual firm or market conditions (for example utilising the UK long lease and the unusual shape of the yield curve). Nonetheless, there are real gains resulting from the innovations, reflecting arbitrage and institutional constraints in the direct (private) real estate market