Farmers' choice between endogenous vs. exogenous e-commerce: alignment with resources and performance goals
ISSN: 0007-070X
Article publication date: 18 June 2021
Issue publication date: 3 January 2022
Abstract
Purpose
The literature shows that e-commerce adoption brings many benefits to farmers and agricultural businesses. However, the literature offers very limited guidance on the most effective ways for them to utilize e-commerce platforms. In this study, we unfold how a farmer's choice between endogenous (their own) vs. exogenous (third-party) e-commerce platforms should be aligned with the external (support from agricultural cooperative) and internal (usage of quality labels) resources they can leverage and the performance goals they want to achieve (market expansion vs. price premium).
Design/methodology/approach
Our study draws on transaction cost economics (TCE) and resource-based theory (RBT) to test the conceptual model with data from a cross-sectional survey of 324 farmers from two provinces in PR China.
Findings
Our findings show that external and internal resources shed additional light on the effectiveness of endogenous vis-à-vis exogenous e-commerce platforms. For farmers who rely on exogenous e-commerce, support from an agricultural cooperative appears to be critical in increasing their market expansion. On the other hand, farmers seeking to earn a price premium should focus on developing their own e-commerce platforms, while at the same time emphasizing the quality labels of their agricultural products.
Practical implications
Farmers should pay close attention to the value-added benefits provisioned through farmers' cooperatives, as well as the benefits of acquiring quality labels for their agricultural products. However, the decision to utilize these resources should be aligned with the chosen e-commerce platform (endogenous vs. exogenous) as well as with the performance goal the farmer wants to achieve.
Originality/value
Our work goes beyond the traditional focus on transaction costs and efficiency of e-commerce channels and provides specific insights into when an endogenous or exogenous e-commerce model might provide benefits for farmers. On top of this, we argue and show that this decision should reside with the farmer's ability to leverage external and internal resources, envisioned through support from an agricultural cooperative and the quality labels of agricultural products.
Keywords
Acknowledgements
This paper is supported by the Social Science Fund of China (17BJY143); The Annual Project of Collaborative Imovation Center of Urban Industries Development in Chengdu-Chongqing Economic Zone (KFJJ2018015); the MOE Project of Key Research Institute of Humanities and Social Sciences, Research Center for Economy of Upper Reaches of the Yangtze River Chongqing Technology and Business University, Team of trade circulation (CJSYTD201701).
Citation
Song, Y., Wu, W. and Miocevic, D. (2022), "Farmers' choice between endogenous vs. exogenous e-commerce: alignment with resources and performance goals", British Food Journal, Vol. 124 No. 1, pp. 61-77. https://doi.org/10.1108/BFJ-02-2021-0152
Publisher
:Emerald Publishing Limited
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