Innovative strategies in the food processing industry: fundamental relationships between institutional, competitive, technological and organizational dimensions

(Case studies)*

Jean Philippe Rvillion jeanpr@cpovo.net Antonio Domingos Padula adpadula@adm.ufrgs.br Luiz Carlos Federizzi federizi@ufrgs.br Orlando Martinelli orlando.martinelli@ufrgs.br Centro de Estudos e Pesquisa em Agronegcios / Universidade Federal do Rio Grande do Sul Av. Joo Pessoa, 31 Sala 202 Porto Alegre /Rio Grande do Sul - 90010-282 Brasil Telephone: (055) (51) 33163484 / Fax: (055) (51) 33163281

Vincent Mangematin vincent.mangematin@grenoble.inra.fr Institut National de la Recherche Agronomique Unit dEconomie et Sociologie Rurales de Grenoble Universit Pierre Mends France BP 47 38040 Grenoble Cedex 9 France Telephone: 33 (0) 476825439 / Fax : 33 (0) 476825455

The Fundao Coordenao de Aperfeioamento de Pessoal de Nvel Superior CAPES, supported this research. Their support is gratefully acknowledged. We would like to thank Oscar Alfranca for his helpful comments and criticisms on previous drafts.

ABSTRACT This research use case studies as an approach to give evidence of the systemic relations and the existent trade-offs between the institutional, competitive, technological and organizational variables involved in the process of innovation in the food processing industry. The unity of analysis consists of dairy processors that recently launched new products in the fluid milk market. The results converged in showing the growing importance of non-price competitive strategies and the concomitantly need to adequate a public policy to generate variety in the technological and organizational forms in order to foster industry competitiveness.

INTRODUCTION Continuous innovation is an issue of vital importance for the strategic management of food processing companies that wish to access or stay in quality based markets. In particular, the alignment of product differentiation and market segmentation represent a essential competitive strategy to face the consequences of the changing balance power in the food retailer-food processing industry relations and the rapid evolution of consumer behavior with respect to agricultural and food products. This research illustrates how progress along a technological trajectory and the emergence of new ones results from the interplay between institutional, competitive, technological and organizational variables. 1. OBJECTIVES The aim of this study is to evaluate the relationships between some fundamental institutional, competitive, technological and organizational factors in the innovation process carried out by food processing firms as defined a priori in the specific literature. The basic questions are: i) How the innovation process is deployed? ii) Why the firms innovate? iii) What are the main determinants to develop innovation in this sector? 2. METHODOLOGY We use case studies as an approach to give evidence of the systemic relations and the existent trade-offs between those factors. We choose a research design with one unity of analysis (food processors that recently launched new products and explored new markets in the fluid milk production chain) and multiple case studies (two firms in Brazil and two in France which launched some of the principal product innovations in this market during the 90s, respectively: Premium UHT milk, sterilized milk and organic UHT milk, microfiltrated milk). Clearly, the structure and strategies developed by suppliers, the dairy industry and the retail food distribution system are undergoing rapid change in those countries helping to show the robustness of the phenomenon across different and complex contexts. The contrast in those two sectoral innovation systems1 acted as a revelatory tool. In particular, the fluid milk market is a hard test to product innovation considering its ordinary character2 and the domination of retail products3 - finally, the supremacy of one process technology (Ultra High Temperature - UHT processing) limits the technological strategies diversity adopted by the food processors4 . Afterwards, we compare enterprises with the same structural profile in the two countries: multinational enterprises MNE (very large multi-product/brand firms) and small and medium enterprises - SME. This configuration is specially useful and robust to confront the theoretical basis, where each case is selected by the researcher to confirm convergent or contrasting evidence between the cases5, 6 . Data from the selected enterprises were collected in semi-structured interviews (Table 1) with principal decision-makers. Complementary, we interviewed independent specialists that closely followed the innovation process. The context of the study and the search for conflicting information was obtained in technical journals, sector reports and academic work. Finally, the empirical observations are compared with similar and conflicting theory about innovation in the food industry in the hope to generalize them to theoretical propositions and not to populations or universes5 . The implications between the specific theory and the phenomenon are explicit in the discussion of the results.

Table 1: Interview guide characterization of the sectoral system of innovation1

Innovation project features Origin and motivation Searched benefits Internal agents mobilized Team organization Mechanisms for product differentiation Mechanisms for market segmentation Mechanisms for trade marketing Characteristics of the Sources of innovation: internal R&D, entrepreneur, suppliers, users, knowledge base (mobilized concurrence to innovate) Accessibility of knowledge Tacit or codified character Level of specificity and complexity Characteristics of the Incremental or radical character technological trajectories Specificity Cumulativity (at the firm, sector or cluster level) Irreversibility Appropriability (patents, industrial secrets, pioneering, structural barriers to imitation) Accessed opportunities Performance of technologies Concurrent technologies Accessed barriers of entry Complementary actives Nature of learning processes, Comportamental diversity competencies, organization Organizational learning and behavior of firms (to Adoption of new methods and techniques innovate) Changes in the strategic orientation Level of technological dependence Co-specialization effects between departments Internal coordination Vertical and horizontal inter- Level of complementary between internal and external R&D relations and Impacts (due to innovation) in the production chain complementarities Level of cooperation with universities, financial and research institutions, governmental agencies Level of cooperation with technological suppliers Cluster effects Cooperation mechanisms: joint-ventures, R&D agreements, licensing, direct investment, user-supplier relationships Importance of public politics: industrial, fiscal, monetary, commercial Importance of consumption patterns: emergence of new trends

3. RESULTS
3.1 The institutional and competitive context of the innovative process France Retail participation in the packaged food sales Retail concentration Incidence of distribution brands in the fluid milk market Relative bargaining power of retail Structure of the equipment supplier segment Importance of public research institutions to forster innovation Concentration in the dairy industry Dominant technological trajectory New possible technological trajectory Main strategies in the dairy sector - MNE Main strategies in the dairy sector - SME 80 %7 In 2002 the 3 largest retail possessed 64% of the market9 Over 60% Strong and growing11, 12, 13 In concentration Brazil 82% 8 In 2001 the 3 largest retail possessed 42% of the market10 Limited Strong and growing14 National clusters in disintegration growing dependence on international suppliers15 Monopolist position16, 17 Limited8

Very important (specially to SME)18

High: 2,1% of the enterprises responds for Growing concentration through 55,6% of production19, 20; in 1995, 3 groups acquisitions of PME by MNE8, 15,22 processed more than 40% of total 21 production UHT processing / PEAD and carton presentation Microfiltration - MF associated with light UHT / PEAD and carton presentation Product differentiation, extend product line, market segmentation11, 12 Focus on niche markets12 and pioneering11, 21 Intensive advertisement, product differentiation8 , brand consolidation, market segmentation23 Focus on niche markets and defensive strategies (imitation of MNE)8, 15 Distribution channel selection4 5,3 billion liters in 2001 Growing (+50% between 94 to 2000) 50% in 19978

Fluid milk production Evolution of fluid milk market Fluid milk market relative to dairy products market (volume processed)

3,9 billion liters in 200124 Regression (- 8% between 1989 to 1999) 21 17% in 200124

Fluid milk markets (in 2001)

Pasteurized milk: 3,0% (partly differentiated) Sterilized milk: 7,1% (no differentiation) UHT milk: 89,9% (75% generic and 25% modified) 21, 24

Pasteurized milk: 27% (partly differentiated) UHT milk: 73% (90% generic and 10% modified) 4

3.2 The French case studies Case A MNE Characteristics of Organic UHT milk (4 months of shelf the new product life without refrigeration) PEAD bottle Innovation sources Raw milk suppliers Motivation Trigger event Strategies Try to segment ordinary UHT milk market / valuate products and brand Crazy cow crisis (1996) Case B - SME Microfiltrated milk (15 days of shelf life a 4-6C) PEAD bottle Process equipment suppliers / Research Institute Process alternative to small scale dairies / face UHT milk boost Rapid market displacement of pasteurized milk by UHT milk Pioneering Niche exploration Positive impact in company image and brand

Pioneering Rapid niche exploration Positive impact in company image and brand Extend product line Trade marketing Product Health and well being Taste profile (close to pasteurized milk) differentiation Ethical concerns with extended shelf life; gastronomic sources Quality labeling: Agriculture Biologique value, terroir appeal Focused markets National Local, regional and national and distribution Mainly big retail 80% big retail channels 20% groceries Actual importance Represents 3% of sales of the UHT line Represents 50% of total sales of the product to Marginal impact in profitability the company Internal project Multidepartments Director and small team agents Appropriability Pioneering Pioneering and idiosyncratic learning Consolidated brand External inter- Focused in develop raw milk supply and Process equipment suppliers, research relations logistics due its geographic dispersion institute, marketing consulting, public Better commercial relations with retail, entities (sanitary control) but without specific cooperation Retail: feed-backs about consumer acceptance Learning processes Supply management Product and process development External relations management Innovative culture Governmental Important to production segment Important to processing segment subsidies Innovative Guaranteed shelf space in retailers Guaranteed shelf space in retailers products impact in stores even after the launch of identical stores

trade marketing

products with retailers or processing firms brands Benefits for retails brand: complete line of products associated with the offer of a cheaper (- 20%) retail brand substitute Better margins with new products

No direct concurrence Benefits for retails brand: differentiate from concurrence Better margins with new products

3.3 The Brazilian case studies Case C - MNE Case D - SME

Characteristics of Premium UHT milk (4 months of shelf Sterilized milk (4 months of shelf life the new product life without refrigeration) PEAD bottles without refrigeration) PEAD bottles Innovation sources Process equipment suppliers Process equipment suppliers Raw milk suppliers Motivation Try to segment ordinary UHT milk Process alternative to small scale dairies market / valuate products and brand / face UHT milk boost Trigger event Commoditization of ordinary UHT Rapid market displacement of milk pasteurized milk by UHT milk Valuate products and brand Strategies Pioneering Pioneering Differentiation Differentiation Positive impact in company image and Positive impact in company image brand Trade marketing Extend product line Increase logistics flexibility (compared Trade marketing to pasteurized milk) Permits to explore seasonal effects in raw milk productions Product Natural appeal raw milk selection First long conservation milk in PEAD differentiation First UHT milk in PEAD bottles bottles sources Focused markets Regional and national Regional and distribution channels Actual importance Represents 15% of sales of the UHT line Represents 30% of total sales of the product to the company Internal project Multidepartments and inter-firms Director and small team agents (international exchanges) Appropriability Pioneering Pioneering aspects Consolidated brand Intensive advertisement External inter- International process equipment suppliers International process equipment relations suppliers Learning processes Governmental subsidies Innovative Product and process development External relations management No Guaranteed shelf space in retailers stores External relations management No Guaranteed shelf space in retailers

products impact in trade marketing

No direct concurrence Benefits for retails brand: differentiate from concurrence Better margins with new products

stores No direct concurrence Benefits for retails brand: differentiate from concurrence

4. DISCUSSION The opportunity conditions in the two countries are very different: even though the market size (fluid milk) is larger in Brazil, the level of direct and indirect subsidies and market sophistication/diversification are greater in France. Nevertheless, in both countries, the level of concentration is growing concomitantly in the dairy sector and retail - both seeking brand consolidation and market segmentation by the offer of innovative products what turns vertical (specially in France) and horizontal (in France and Brazil) competition a fiercely process (a sectors characteristics, as evidenced by many authors37, 44, 45, 51). The technological opportunities explored in the two countries are somewhat diverse: i) in Brazil the product innovations in fluid milk still are predominantly incremental, concerning packaging and product formulation variations; ii) in France, the emergence of a new technological trajectory27 in fluid milk processing (microfiltration) may represent an important technological path. In both situations powerful equipment suppliers orchestrate the sectoral evolution. In all of the case studies clients and consumers are considered in relation to the emerging markets consequence of new needs, life-styles and socio-economic trends. Nevertheless, the innovation strategies seems to be predominantly related to competitive positioning, specially pioneering in new products/technologies (as evidenced by other authors30 for the European food processors) what paradoxically can limit formalized research on consumers behavior or trade marketing impact. Here again, market intelligence prevails over market orientation as observed in other innovative food processors case studies28 . As a matter of fact, market selection and technological paths co-evolve in a complex (and rather incremental) way27 what indicate the complementary role of marketing studies in forecasting the direction of the innovative opportunities. Although the external technological offer, the knowledge base mobilized in the SME to innovate depends in a preponderantly tacit process based in the entrepreneur competency to consider the fit between the market opportunity, the technology specificitys and the firm capabilities to explore them and forecast the possible evolution of this complex system. Otherwise, as process technology (like MF) needs to be adapted to raw material particularities and the need to coordinate and integrate internal and external actors gain importance (as demonstrated for other SME in the food industry18, 29 ) the idiosyncratic character of the learning process became evident. In the case of the MNE, even considering the mature character of the technologies and the higher degree of formalization, the processes of selection and coordination of external partners (raw milk suppliers, equipment suppliers, research institutes) and integration between multidepartements call for tacit capabilities and leadership. All the case studies illustrate the dynamics of a sector which depends extensively on public and private organisms suppliers of technology embedded in equipment, suppliers of materials or components and an applied research network4, 30, 31, 32, 33 . Besides, the switch between the search for external complementarities and the mobilization of internal capacities illustrates the interactive innovation model with feedbacks where the R&D activities are instrumental34 - as observed for other food processing firms28, 30, 32.

The importance of the institutional structure is explicit in the French case studies. Considering the organic UHT milk production chain, the offer of subsidies and the consolidation of a normative structure were very important to incentive the conversion of many producers amplifying the production base35 and to configure this production system26 . The definition of specific norms applied to the organic production even if based in an obligation of results and not of ways associated with the adoption of one, well recognized, label of quality permitted to assure the consumers and promote the rapid diffusion of the organic products25 . Paradoxically, this institutional apparatus didnt favor the production segment since the over production of raw milk lead to a lost in its value - even if the production of organic milk present many tacit and complex learning features. In this case, these effective appropriability mechanisms (to the raw milk producers) where annulled as a competitive advantage due the lack of a geographic delimitation in the production (like in the Appelation dOrigine Controle production systems). The standardization of the key elements in a quality food production process can diminish the potentiality of the differentiation strategies36 . In a similar way, in the adoption of the MF technology by the SME, the existence of a public research unit (whose director represents a technological gate keeper) favored the establishment of key inter-relations between the specific actors concerned (equipment supplier, research institute, SME internal team and public organisms responsible to food control) and the technology adaptation (the importance of public institutions to the innovation process have been illustrated in the French food processing SME18, 32 ). In Brazil, the impacts due to the institutional structure in the innovation process were of a much smaller dimension. The principal relation between the research institutions and the dairies is related to product or process quality control8 . Otherwise, the one-way profile in the relations between equipment suppliers and fluid milk processors limits the development of innovative technologies and products4, 8. These features characterize a system of innovation excessively dependable on international technological suppliers8 which raises the costs and limits the adequability of the technological options 15 , limits the technological variety4 and restraints coevolution between the agents with lost in competitiveness specially to the SME8, 15. One convergent feature in the cases is related to the low appropriability of the technologies developed and offered by equipment suppliers - specially, in the case of SME. Even if the knowledge base associated with the technology adaptation present some elements indicating a tacit and complex learning, the effectiveness of marketing complementary strategies (advertising, distribution channel selection, brand positioning) which can potentially enhance the benefits in pioneering - are limited by the modest financial and technical resources of SME (as noted for other SME in the food processing sector37 ). Besides, the growing need to serve the big retail restrain the opportunities to explore new markets since the bigger dairy processors with complete lines in each product category and a great capacity to promote them keep an asymmetric bargaining power and dominate the shelf spaces (as observed in the dairy sector in France11 and in the food processing segment in general44, 46, 48). Nevertheless, the success of SME in first exploring market niches indicates a greater flexibility and acuity in the perception of new consumer needs38 . In this sense, it is critical to the SME the capacity to profit the first stages of the technological cycle, process dependable on its agility in the mobilization of internal resources in order to detect emerging niche markets and select and adapt new technologies32, 39 . Indeed, the greater technological variety and the diversity of strategic choices, characteristic of the early stages in the life cycle of one sector as in the preparadigmatic stage of a new technology when a dominant design have not consolidated yet40 favors the SME41 . Eventhough, it is a problematic situation to visualize surviving only in this

period of ferment: the potential for the optimization of organizational processes, to reach economies of scale and to permit reliable and stable relations with suppliers is limited since the first technological discontinuities rarely became an industry standard - a dominant design only consolidate as an evolution of the original breakthrough42 . This dynamic feature seems to be confirmed in the evolution of the MF technology: the first technological configuration (1,4 m MF membranes 15 days of shelf life at 4-6C) - adopted by the SME focused in the case study is about to be menaced by a more developed system (0,5 m MF membranes associated with light UHT - 4-6 months of shelf life at ambient temperature) the latter technological option is more adapted to the larger dairy processors. In a much more comfortable position, the MNE can establish entry barriers to smaller concurrence - by selecting technologies that demands high financial commitments and benefit from scale economies - and surviving constraints since the performance evolution of the dominant design tend to be incremental and routinized - stimulating concentration27, 41 . This dynamic is especially true considering that the development of close and technically creative supplier relationships appear to be keys to successful, continuing dominance of the bigger enterprises and that the equipment suppliers who head the technological development may put enough weight behind a particular design to make it a standard42:616. Besides, following Suttons propositions 43 , endogenous sunk costs can deter competition from SME too as growing marketing and P&D fixed costs require a higher level of sales to amortize them44, 45, 46 . Indeed, product innovation in the food industry will be better explored if the adoptants have the necessary advertising capacity (as in the case of Premium UHT milk), brand positioning (as in the case of the organic UHT milk) and technological leadership (as in the new MF variant) permitting the bigger firms to explore scope economies and shelf space in retail. Even considering these asymmetries, there is convergence in all cases studies considering the critical effects in pioneering the development of new technologies and in the offer of new products (as emphasized by other authors44 ): it guaranteed shelf space in retailers stores, even after the launch of identical products with retailers brands. Complementary, the usual exigencies of retail related to marketing support47 seemed to be softened (as was the case with sterilized milk). Besides, innovation was an important tool to generate brand loyalty and reputation and functioned as a partial substitute to advertisement since notoriety came along with novelty (as in the case of the MF milk). The importance of increasing the frequency of new products launches19, 48, 49 and market segmentation46, 50 seem to be clear to all the enterprises focused in the case studies. Nevertheless, the retail capacity to rapid respond with similar products and own brands was especially important in France19, 21, 51, 52. 5. CONCLUSIONS The results converged in showing the growing importance of non-price competitive strategies in a context of accruing concentration in the processing and distribution segments. In this context it is very important to deploy an adequate public policy to generate variety in the technological and organizational forms in order to foster industry competitiveness. In this sense it would be critical to maintain an effective network capable to sustain a process of continuous innovation in the SME of the food industry - as their survival will depend on the exploration of ever-shorter periods in the beginning of technological cycles. This aim seems to be critical in Brazil considering the fragility of the institutional structure to support innovation in this industry. The establishment of cooperation mechanisms between public research institutes, food processing machinery industry, regularization and control organisms were more relevant to the innovative

French processing firms than the Brazilian ones. Nevertheless, in some situations the specifications of food quality standards and production regulations had ambiguous effects: in one way they limited opportunism in the chain and helped to communicate the differential characteristics of the food products to consumers, in the other way they limited the appropriability of the innovations. The research illustrates how progress along a technological trajectory and the emergence of new ones results from the interplay between institutional, competitive, technological and organizational variables.

REFERENCES 1. Breschi, S. and F. Malerba, 1997. Sectoral innovation systems: technological regimes, Schumpeterian dynamics, and spatial boundaries. Pp.130-156 in C. Edquist, ed., Systems of innovation Technologies, Institutions and Organizations. London and Washington: Pinter. 2. Siebert, J. W., R. Schwart, M. Pritchard and M. Seidenberger, 2000. Suiza foods corporation: best management strategy in the fluid milk industry. International Food and Agribusiness Management Review, 3: 445-455. 3. Galizzi, G., L. Venturini, and S. Boccaletti, 1997. Vertical relationships and dual branding strategies in the Italian food industry. Agribusiness, 13(2): 185-195. 4. Rvillion, J. P., A. D. Padula and A. Brandelli, 2001. Estudo das variveis relevantes na adoo da tecnologia de processamento UHT nas agroindstrias de laticnios no estado do Rio Grande do Sul. Revista do Instituto de Laticnios Cndido Tostes, 323(56): 3-12. 5. Yin, R. K. 1994. Case study research: design and methods. 2nd edition. London: Sage Publications. 6. Sterns, J. A., D. B. Schweikhardt and H. C. Peterson, 1998. Using case studies as an approach for conducting agribusiness research. International Food and Agribusiness Review, 1(3): 311327. 7. Carrier, C., A. Edy and W. El Singab, 2002. Le panorama du systme alimentaire en Europe. Pp. 11-35 in S. Miloszyk, J. Achehaifi, Y. El Maslouhi and J. L. Rastoin, eds., Marchs, Filires et Systmes Agroalimentaires en Europe. Montpellier: Institut Agronomique Mditerranen de Montpellier. 8. Bortoleto, E. 2000. Trajetria e demandas tecnolgicas nas cadeias agroalimentares do MERCOSUL ampliado - Lcteos. Montevideo: PROCISUR/BID. 9. GMS Dossier Spcial Grandes et Moyennes Surfaces: ce quil faut savoir, in www.fdsea51.fr/actualites/communiques. 10. ABRAS Associao Brasileira de Supermercados - Ranking 2001 in www.abrasnet.com.br

11. DHauteville, F., G. Bardou and J. M. Codron, 1996. LInnovation Produit dans la Relation Fournisseur Distribuiteur en Agro-Alimentaire. Programme Aliment 2000 Innovation, Projet GIPIA N R 93/13. Montpellier: Chaire de Gestion-GRAAL, ENSA. 12. Richard, E. and B. Sylvander, 1997. La filire lait biologique: stratgies dacteurs, dveloppement de march - Rapport n97-03P. Le Mans: INRA-ESR. 13. Drescher, K. and O. Maurer, 1999. Competitiveness in the european dairy industries. Agribusiness, 15(2): 163-177. 14. Farina, E. M. M. Q. 2001. Challenges for Brazils food industry in the context of globalization and Mercosur consolidation. International Food and Agribusiness Management Review, 2(3/4): 315-330. 15. Dirven, M. 2001. Dairy clusters in Latin America in the context of globalization. International Food and Agribusiness Management Review, 2(3/4): 301-313. 16. Santos, C. F. M. 1999. Novas tecnologias e o selo verde. Revista Leite & Derivados, 8(44): 30-43. 17. Massote Primo, W. 1999. Restries ao desenvolvimento da indstria brasileira de laticnios. Pp. 71-127 in D. Vilela, M. Bressan and A. S. Cunha, eds., Restries Tcnicas, Econmicas e Institucionais ao Desenvolvimento da Cadeia Produtiva do Leite no Brasil. Braslia: MCT/CNPq/PADCT, Juiz de Fora: EMBRAPA CNPGL. 18. Le Bars, A. 2001. Innovation sans recherche: les comptences pour innover dans les PME de lagro-alimentaire. These de Doctorat en Economie Applique. Grenoble: Universit Pierre Mends-France UFR Dveloppement Gestion Economique et Socits. 19. Trail, B. 1997. Structural changes in the European food industry: consequences for innovation. Pp. 38-60 in B. Trail and K. G. Grunert, eds., Product and Process Innovation in the Food Industry, Suffolk: Chapman & Hall. 20. Trail, B. and J. Gilpin, 1998. Changes in size distribution of EU food and drink manufacturers: 1980 to 1992. Agribusiness, 14(4): 321-329. 21. Imelda, H., R. Elisabeth and E. M. Youns, 2002. La filire lait. Pp. 57-75 in S. Miloszyk, J. Achehaifi, Y. El Maslouhi and J. L. Rastoin, eds., Marchs, Filires et Systmes Agroalimentaires en Europe. Montpellier: Institut Agronomique Mditerranen de Montpellier. 22. Jank, M. S., M. F. Paes Leme, A. M. Nassar and P. Faveret Filho, 2001. Concentration and internalization of Brazilian agribusiness exporters. International Food and Agribusiness Management Review, 2(3/4): 359-374. 23. Reardon, T. and E. Farina, 2002. The rise of private food quality and safety standards: illustrations from Brazil. International Food and Agribusiness Management Review, 4: 413-421.

24. CNIEL Centre National Interprofessionnel de lEconomie Laitire. 2002. LEconomie Laitire en Chiffres. Paris: Le Clavier. 25. Sylvander, B., F. Porin and P. Mainsant, 1998. Les facteurs de succs de qualit spcifiques dans lagro-alimentaire. Rodez: VII Journes des Sciences du Muscle et Technologies de la Viande. 26. Sylvander, B. 2000. Les tendances de la consommation des produits biologiques en Europe. Pp. 192-212 in G. Allard, C. David and G. Henning (eds.). Lagriculture biologique face son dveloppement les enjeux futurs. Lyon: Editions INRA. 27. Dosi, G. 1982. Technological paradigms and technological trajectories. Research Policy, 11: 147-162. 28. Grunert, K. G., H. Harmsen, M. Meulenberg and B. Trail, 1997. Innovation in the food sector: a revised framework. Pp. 213-226 in B. Trail and K. G. Grunert, eds., Product and Process Innovation in the Food Industry, Suffolk: Chapman & Hall. 29. Mangematin, V. 1997. De la capacit d'absorption la capacit de gestion : l'exemple des P.M.I. de l'agro-alimentaire en Rhne-Alpes. Cahiers dEconomie et Sociologie Rurale, 44: 85105. 30. Christensen, J. L., R. Rama and N. G. Von Tunzelmann, 1996. Innovation in the european food products and beverage industry. Industry studies of innovation using C.I.S. data. Bruxelles: European Commission EIMS Project 94/111 EIMS Publication n35. 31. Martinez, M. G. and J. Burns, 1999. Sources of technological development in the spanish food and drink industry. A supplier-dominated industry ? Agribusiness, 15(4): 431-448. 32. Mangematin, V. and N. Mandran, 1999. Do non-R&D intensive industries benefit of spillovers from public research? The case of the Agro-food industry" in A. Kleinknecht, P. Monhen and E. Elgar, eds., Innovation and Economic Change: Exploring CIS micro data. 33. Trail, B. and M. Meulenberg, 2002. Innovation in the food industry. Agribusiness, 18(1): 121. 34. Kline, S. J. and N. Rosenberg, 1986. An overview of innovation. Pp. 275-305 in R. Landau and N. Rosenberg, eds., The positive Sum Strategy. Washington: National Academy Press. 35. ONILAIT Office National Interprofessionnel du Lait et des Produits Laitiers. Enqute sur la filire laitire biologique en 2001 Premiers rsultats. Mai 2002. 36. Khl, R. W. 1997. Quality labelling. Pp.127-136 in F. Nicolas, L. Lagrange and G. Giraud, coords., conomie et Marketing Alimentaires Actes du colloque des 20 et 21 juin 1997, ENITA de Clermont-Ferrand, Paris: ditions Tec & Doc. 37. Grunert, K. G., H. Harmsen, M. Meulenberg, E. Kuiper, T. Ottowitz, F. Declerk, B. Trail and G. Goransson, 1997. A framework for analysing innovation in the food sector. Pp. 1-33 in B.

Trail and K. G. Grunert, eds., Product and Process Innovation in the Food Industry, Suffolk: Chapman & Hall. 38. Noteboom, B. 1994. Innovation and diffusion in small firms: theory and evidence. Small Business economics, 6: 327-347. 39. Audretsch, D. B. 1995. Innovation, growth and survival. International Journal of Industrial Organization, 13: 441-457. 40. Abernathy, W. J. and J. M. Utterback, 1978. Patterns of industrial innovation. Technology Review, 80: 41-47. 41. Utterback, J. M. and F. F. Surez, 1993. Innovation, competition, and industry structure. Research Policy, 22: 1-21. 42. Anderson, P. and M. L. Tushmam, 1990. Technological discontinuities and dominant designs: a cyclical model of technological change. Administrative Science Quarterly, 35(4): 604-633. 43. Sutton, J. 1991. Sunk Costs and Market Structure: Price Competition, Advertising, and the Evolution of Concentration. Cambridge: MIT Press. 44. Galizzi, G. and L. Venturini, 1996. Product innovation in the food industry: nature, characteristics and determinants. Pp. 133-153 in G. Galizzi and L. Venturini, eds., Economics of innovation: the case of food industry. Heidelberg: Physica Verlag. 45. Venturini, L. 1997. Vertical competion and forms of cooperation. Pp.23-35 in F. Nicolas, L. Lagrange and G. Giraud, coords., conomie et Marketing Alimentaires Actes du colloque des 20 et 21 juin 1997, ENITA de Clermont-Ferrand, Paris: ditions Tec & Doc. 46. Connor, J. M. and W. A. Schiek, 1997. Food Processing An Industrial Power House in Transition. New York: John Wiley & Sons. 47. Park, J. L. 2001. Supermarket product selection uncovered: manufacturer promotions and the channel intermediary. International Food and Agribusiness Management Review, 4: 119131. 48. Connor, J. M. 1981. Food product proliferation: a market structure analysis. American Journal of Agricultural Economics, 63(4): 607-617. 49. Cotterill, R. W. 1997. The food distribution system of the future: convergence towards the US or UK model ? Agribusiness, 13(2): 123-135. 50. Steenkamp, J-B, E. M. 1997. Dynamics in consumer behavior with respect to agricultural and food products. Pp. 143-188 in B. Wierenga, A. Van Tilburg, K. Grunert, J-B. E. M. Steenkamp and M. Wedel, eds., Agricultural Marketing and Consumer Behavior in a Changing World. Boston: Kluwer Academic Publishers.

51. Hugues, D. 1996. Building partnerships and alliances in the european food industry Pp. 101-117 in G. Galizzi and L. Venturini, eds., Economics of innovation: the case of food industry. Heidelberg: Physica Verlag. 52. Hugues, A. 1997. The changing organization of new product development for retailers private labels: a UK US comparison. Agribusiness, 13(2): 169-184.