Magoosh GRE

Research in Practice

| December 14, 2016

Introduction

 Population growth and issues such as globalisation are the main drivers behind an increase in demand in the food sector. According to the USDA (2012), “Processed soybeans are the world’s largest source of animal protein feed and the second largest source of vegetable oil”. This can be used as an indicator that there is a constant demand for soybean in the food industry.

Whilst it is a fact that the US are leaders in soy production, according to a study by the IDEI (2012), soybean is mainly imported into the EU as there is high demand and a large variety of products that are made with or from soybean. In fact, demand exceeds its production (0.9 million tons/year) and imports reach around 30-35 million tons per year. France, for example, produces approximately 140,000 tons per year and imports around 4 million tons of soybean meals for animal consumption, including 0.5 million tons of seeds.

This type of issue has external and internal factors that could influence the PESTEL factor of governments within the EU. This is especially pertinent in Poland where economic dependency is on imports or on a small number of key suppliers. Nevertheless, different issues can be analysed in order to identify these types of problems, but one of the main factors is the controversy of GM and non-GM soybeans. The EU legislations refer to the non-authorization of the GM soybean and other GM crops in the EU, and authorization of high levels of import of GM soybean. This eventually means that 50% of soybean meals imported include GM.

 Nevertheless, issues such as the supply chain and the end consumers tend to be interested in healthier foods, and where the place of the soy protein ingredients could take place. Therefore, the study of the supply chain and adaptation of appropriate strategies may affect the increase in efficiency and profitability.

Literature Review

Focusing on the concept of supply chain, there are several studies aimed at understanding where a common view on the supply chain is found.  For example, according to Simchi-Levi et. al (2007), it is clearly seen that the supply chain involves developing an efficiency for all of the inputs, while going through a process of transformation and coming up with the outputs using the best possible strategy. This has led to the development of new tactics and strategies in terms of operational and planning processes of the supply chain (Simchi-Levi et al., 2004)

Nonetheless, Kreipl and Pinedo (2004) have discussed that in order to achieve a successful operation, there should be a decent planning of supply chain and goal setting. With an account of the whole structure of the organisation including micro and macro technological and financial factors (Lambert & Cooper, 2000; Bowersox et al., 2002), the supply chain is being studied in many different variations such as strategic and tactics. However, in simple business conceptuality, it is mainly about receiving minimum costs and predicting movement of the business.

In order to be more specific, according to various researchers, there are five main factors that are involved with supply chain management such as the use of outsource teams (Bal et al, 1999) and according to Christopher (2000), the incorporation of processes which spread the risks but also the income. This can lead to better ICT skills (Morash, 2001) and also helps with a long-term relationship with the suppliers (Schonsleben, 2000).

On the other hand, there are cases where wrong planning and expectation lead to relationship issues between partners and therefore, the production process. In order to ensure these issues are avoided, a coordination of the managers in different departments should be presented (GEMI, 2004). According to Anderson and Tushman (1990) and Christensen (2003), it might be overlapped by being more innovatively structured within the existing market, or as Griffin and Page (1996) argue, being new in the market in terms of the first mover. On the other hand, Sebastiao and Golicic (2008) combine the two views and argue that the success of a company is based on the development of the supply chain such as the dynamics of the market.

Frazelle (2002) states that the entire organisation across the supply chain should co-ordinate in order to maximise shareholder and customer cost through methods such as analysis of the measurement from operations, vertical integration which collaborates the logistics and logistics services.

The changes in international business have led to changes in the supply chain and pose many questions towards these changes and the strategies that should be taken by companies (Christopher, 2005), Hopkin (2010) adds to this perception and argues that supply chain management becomes even more important due to global business. Nontheless, according to Bozart and Handfield (2006), the company’s survival depends on the way that the supply chain managers operate it. The leading point of supply chain managers is the ability to create a competitive advantage (Klassen and Johnson, 2004).

Lavoie (2005) provides an example of the agricultural product, wheat, in which the importance of the supply chain and the logistical performance are more dynamic in than simply the competition even though the process differs due to difference in handing and supply chain process. The price differs by grade of protein and other characteristics.

According to the USDA, forecasts for vegetable protein demand in 2011 have grown compared to previous years which means that the availability of meal from South America might be lowered and this might be seen as opportunity for the USA to expand its share of the Polish soybean meal. (Agata Kingsbury, 2011)

 

 Thesis statement

 The main aim of this research is to allocate the supply chain of the soybean in Poland, the main producers, especially the main consumers and customers, and to allocate gaps in the market which could be seen as emerging business opportunities. There should be an understanding of the latest data and the major stakeholders of this particular market and industry. This could eventually identify gaps in the market, and might be a useful tool for market research in emerging members of the EU such as Poland, eventually creating potential strategies for establishment of a business in this specific industry.

The following research could be conducted with secondary and primary research which is available through major agricultural institutions and different major players of the market, such as traders but mainly comes from the users of the Soybean in Poland. There will be a comparison with Non-EU markets as they are part of the stakeholders and exporters. With the allocation of the existing organisations in Poland, there might be an outcome for potential markets. There will therefore be primary research such as interviews with professionals included.

Methodology

Philosophy of Study

The two following philosophies of Positivism and Interpretivism are going to be examined during the research of the emerging opportunities in the Polish market with soybeans. The first theory will be looking at other theories and attempting to generalise them through looking at their outcomes both in and observable social reality which eventually can lead to gathering of relevant data such as by looking at the market performance in Poland and trying to relate it to the concept of growth in the market and possible market gaps in EU food industry (Remenyi et al., 1998).

On the other hand, there will be the use of an interpretivistic approach throughout the analysis of the interviews with the different Soybean producers and traders in Poland and other countries in the EU so as to non-EU members such as Ukraine, and finally, when evaluating the research findings based on the interviews for the industry professionals.

Approach

This research will mainly analyse business opportunities in the Polish Soybean market in the food production sector and is going to be conducted using the inductive approach.

According to Bryman and Bell (2007), this particular method is the relationship between theory and the research that is being undertaken and finally, trying to evaluate and create a theory or concept out of the research. As in this particular research, there will be an analysis and study of the soybean in Poland and attempts to evaluate the issues that might relate to theory and concept which are the possibilities to market opportunities in Poland as an EU member, possibly become a European leader in producing soybean food products and potentially create possible strategies to develop the Soybean food industry in Poland by learning its implications and potential growth.

Purpose of Research

Explanatory research tends to be conducted by the researcher as the initial research requires the use of a decent amount of surveys to indicate the main topics for subsequent research. Consequently, I will conduct research of emerging possibilities in the Soybean industry in Poland and the EU and its possible growth and development, possibly finding challenges in the market of the food industry in Poland by looking at data analysis, eventually being able to develop a strategized correlation. Therefore, the qualitative data that will be researched may allow this understanding and will adopt a clear vision of possibilities at relatively new markets. This particular method could be seen the most appropriate out of the three methods for this type of study (Lee, Collier & Cullen, 2007)

Research Design

As the main research focuses on the Soybean market in Poland and its effect on the food industry in Poland and the EU, I will be studying these particular industries and their potential growth and strategic analysis and finally, recommendations.

Therefore, the study will involve a case study of large multinational companies that are mainly controlling the industry in term of their size and pricing. These companies include Cargill, Topfer, Bunge, Desmet Ballesetra, EuroFin and other possible American and EU organisations that can be found throughout the duration of the research. According to Saunders et al., there is a need for using various companies for research in order to gain a better understanding and establish the relevant data necessary for the research. The Mmin purpose in the collection date from these companies is due to the fact that they are deeply involved in the market and have strong forces of influence on it.

An important factor is to interview these companies and their regional director in order to begin to create an image of the Polish soybean market and its supply chain, and finding the reasons of why and what could be done better.

Another important issue is why Polish is being studied and this is due to the fact that it is relatively new market and a new member of the EU with large potential in terms of development and its geographical and logistical preferences.

Sample Size

 In this particular research, the sample will consist mainly of the Polish Soybean market and companies motioned above that are operated in Poland. As these soybean companies in Poland are European members, there will be an analysis of the EU soybean market and the main aspects of the supply chain of this particular business. I expect the sample size to grow over the period of this research.

Secondary Research

As mentioned earlier, there will be a study of the supply chain of the business. Therefore, there is a need to provide secondary data drawing on books on supply chain, statistics of worldwide agricultural figures and changes, and journal articles of the companies’ performance. In order to indicate the performance of the market and any potential gaps in Polish soybean market which eventually could lead to credible data for business strategy, there will be other sources that are provided by the case study such as reports and presentations of new strategies and their supply chain.

Primary Research

Furthermore, there is a need to research primary data, based on direct interactions with the studied area and the main companies involved in the industry. There is also a need to study the agricultural polish department in terms of regulation and understanding the actual business in terms of legality, and to eventually conduct an analysis based on primary findings from processing companies in the food industry in Poland in the case of the Non-GMO soybeans. In this particular research, the most suitable method for primary research is a direct interview technique which consist of mostly semi-structured interviews.

There will be five interviews in total that will be taken during the summer of 2013. One interview will take place with the CEO of the multinational company Bunge and another interview will be conducted with the CEO of other similar company; MNC Toepfer. In both interviews, the main focus of the conversation will be the relationship of companies in Poland on their activates of business in Poland, from their trading perspective and so as manufacturing and relationship with local producers. Such as their supply chain, or challenges that they face in this field in Poland, so as their main reasons for entering these specific markets.

Another interview will take place with a non EU member but also a major importer to Europe of Non-GMO soybean. This is the Ukrainian company ATK. The main aspect of this interview is to research the soybean market in terms of its production in the EU and the main concerns of food producers. Geographically, Ukraine has a potential for business in Poland with the Soybean, especially as Ukraine is one of the largest agricultural exporters in the world

Two more interviews will be conducted with the Polish Soybean Extracting company Zlato Zerno and one with the Agricultural Ministry office in Poland. These interviews will be conducted to understand the actual concept of Non-GMO and the role of soy in the food sector in Poland and the EU.

In terms of reliability and validity of the data, there may be couple of challenges such as whether the companies would like to provide the needed information, and if so, whether it would be based on academic material and world financial organisations such as the USDA.

 Ethical Issues

The main ethical issues that might arise involve the primary research. When companies are studied, particularly private enterprises where there is a lack of transparency, there might be protection of particular data. Another factor is that most of the interviews are going to be conducted in foreign languages such as Ukrainian, Polish, and Russian and therefore, there will be a need for translation in order to avoid misunderstanding of the cultural differences in terms of language.

Resources

 When referring back to the primary research, there are a variety of places that the interviews are going to take place in such as Warsaw, Kiev, Krakow, and potentially in Belgium. Interviews will take place over a two-month period of summer and shall end in London for evaluations.and further interviews on Skype or via e-mails.

Conclusion

Considering the growth of globalisation, the increase of border-free trade between different countries, the dramatic increase in migration and population growth and the rise in concern for healthier products and a more sustainable environment, there is a need for food processing with constant growth in this particular area.

This particular research is aimed at covering the knowledge in this industry and sphere, so as to conduct strategic analysis and eventually to make outcomes on the development of the food industry in Poland, within the context of Non-GMO soybean, and its potential growth, by looking at Poland and so as Europe and non European member which are geographically European.

 

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