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"Farm workers are the foundation of a massive supply chain that includes farmers, distributors, but that is dominated by fast food, food service and supermarkets, like Publix."

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"Farm workers are the foundation of a massive supply chain that includes farmers, distributors, but that is dominated by fast food, food service and supermarkets, like Publix."

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This quote summarizes the roles and positions of each party in the supply chain. From the farm workers and farmers, to the distributors, and then to the fast food chains, food services, and supermarkets, produce is grown, packaged, sold, distributed and sold again to local consumers. In this article, the authors focus on buyer-seller power within supermarkets, and analyze effective buyer trustworthiness and supplier satisfaction and performance. Taking the perspectives from this large supply chain, results showed that farmers and large corporation buyers who have a consistent business are more satisfied (Gorton, Angell, Dries, Urutyan, Jackson, & White, 2015). Between these parties, where supermarkets have the most power in a business deal, characteristics and methods such as this benefit trade deals and provide a more fair trade system.

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Power, buyer trustworthiness and supplier performance: Evidence from the Armenian dairy sector

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The paper presents a Multiple Indicators and MultIple Causes (MIMIC) model for explaining the relationships between buyer-seller power, buyer trustwor...

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"Over the course of an average work day, workers pick, carry and throw about four thousand pounds of tomatoes earning them ~ $40 a day, or a little over a penny for each of those pounds. That's why the CIW has asked Publix to pay just a penny more per pound to double farm worker wages."

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"Over the course of an average work day, workers pick, carry and throw about four thousand pounds of tomatoes earning them ~ $40 a day, or a little over a penny for each of those pounds. That's why the CIW has asked Publix to pay just a penny more per pound to double farm worker wages."

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I chose this quote, because I find the calculations amazing. Farm workers will get paid very little, and farmers' businesses rely on the powerful supermarkets. Win-win situations do not seem to exist between these relationships, and the poor wages given to farm workers is taking its toll on individuals, families, and communities. The article below tells of the inability for small-scale coffee productions to be successful and pay their workers a fair wage (Linton, 2008). Along with tomatoes and a long list of other produce, coffee bean workers are given little for the work they perform, and this is considered a major crises worldwide.

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"At the beginning of the season, Jacob would sell his tomatoes through a contract he'd sign with a supermarket, but the supermarket was soon able to buy tomatoes from Mexico at a price that Jacob couldn't match. It would now cost Jacob a lot more money to harvest and pack his crop, than to let it rot."

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"At the beginning of the season, Jacob would sell his tomatoes through a contract he'd sign with a supermarket, but the supermarket was soon able to buy tomatoes from Mexico at a price that Jacob couldn't match. It would now cost Jacob a lot more money to harvest and pack his crop, than to let it rot."

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This quote made me sad, and I chose it because it is an example and outcome of monopsony and supermarkets. Similar situations occur In Nicaragua and other countries in Central America. This article describes how small-scale farmers take very large risks entering into contracts with supermarket chains. Walmart, as well as other large corporations, continue to change their buying prices often, making it an unpredictable outcome for farmers and their businesses (Michelson, Reardon, & Perez, 2012).

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Small Farmers and Big Retail: Trade-offs of Supplying Supermarkets in Nicaragua

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In Nicaragua and elsewhere in Central America, small-scale farmers are weighing the risks of entering into contracts with supermarket chains. We use u...

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"You've got the system where supermarkets have enormous buying power. By their existence, they shape the whole system, but despite having that power the supermarkets don't want to be growing the food themselves. They certainly don't want to be hiring the farm workers, [and] they don't want to take on the risk of actually producing the foods that get delivered to consumers."

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"You've got the system where supermarkets have enormous buying power. By their existence, they shape the whole system, but despite having that power the supermarkets don't want to be growing the food themselves. They certainly don't want to be hiring the farm workers, [and] they don't want to take on the risk of actually producing the foods that get delivered to consumers."

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Throughout this movie, I continued to learn of the power supermarkets have. Farmers compete to sell their produce to these supermarkets in hopes to offer an attractive buying price that will also make themselves a profit. Though supermarkets do not grow or distribute their merchandise, they still shape the system and have enormous buying power. This quote explains the situation well, and so does the article below. The supply chain analyzed, shows unbalance between the three parties at hand. The farm workers, farmers, and supermarkets all handle business in a supply chain with a design problem making it difficult for a party to prosper from worthwhile labor (Xiaoxue, Llang, Reardon, & Zilberman, 2016).

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"When a company is able to dictate its pricing structure down its entire supply chain, a free market no longer exists. Economists call this unfair market, a  monopsony."

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"When a company is able to dictate its pricing structure down its entire supply chain, a free market no longer exists. Economists call this unfair market, a  monopsony."

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I found this quote really helpful when grasping the understanding of the power of supermarkets. Monopsony is also a new word I learned through this quote. In the article attached, economic development in a monopsony situation is considered. The authors suggest that a new strategy that is designed to allow more freedom among trade, will help the underdeveloped countries and farmers be more marketable (Skarstein, 2007).