From farm to fork: logistics, transport, infrastructure

In Thailand, as in other markets, the supermarket ‘revolution’ is seen as a ‘two-edged sword’. On the one hand, it can lower food prices for consumers and create opportunities for farmers and processors to gain access to quality-differentiated food markets and raise incomes. On the other hand, it can create challenges for small retailers, farmers, and processors who are not equipped to meet the new competition from, and requirements of, supermarkets. Retailing in Thailand has come a long way in only a couple of decades, with new companies entering the market, such as the large European companies Tesco, Carrefour (until recently) and Big C (Casino Group). The number of convenience stores has also grown, with 7-Eleven (6000 stores) run by CP Group (CP ALL) and to a lesser extent Family Mart from Taiwan. Along with these modern trade retailers, third party logistics (3PL) service providers such as Linfox, DHL, CEVA Logistics and others have also entered Thailand. They have used their international experience to improve standards, speed of service and value of service, helping retailers offer more fresh produce and a wider variety of items at a lower delivered cost. In the 1980s, Thailand already had transport infrastructure in the form of an arterial road system, and that infrastructure was continually improved during the nineties even in the aftermath of the financial crisis of 1997. This has resulted in the road network being one of the best within ASEAN. Developing-country governments can put in place a number of policies to help both modern and traditional retailers. For example, in Vietnam, even though the country was accepted into the World Trade Organization with all its market-levelling requirements, international 3PL companies are allowed to operate only as a junior partner in a joint venture with a local company or companies. They cannot operate as a wholly-owned foreign enterprise as yet. Therefore they are not willing to invest heavily in assets until they have control of the company, and this in turn gives the local industry time to develop, ready for the time when the 3PL providers can have a controlling interest and thus be competitive.


Issue Date:
2011-08
Publication Type:
Conference Paper/ Presentation
PURL Identifier:
http://purl.umn.edu/125317
Total Pages:
8




 Record created 2017-04-01, last modified 2017-08-26

Fulltext:
Download fulltext
PDF

Rate this document:

Rate this document:
1
2
3
 
(Not yet reviewed)