A Novel On-line Business Model of Organic Farming and Fresh Produce
Date Issued
2014
Date
2014
Author(s)
Lee, Pei-Ying
Abstract
Organic framing adapts more eco-friendly method of production process by not using any pesticide and chemical fertilizer. On the other hand, the traditional agriculture in Taiwan rely heavily on pesticide and chemical fertilizer, which leads to environmental pollution and ecological imbalance. Since our living space cannot be isolated from the nature environment, the negative effects that pesticide and other chemical substances bring along also endanger human health. Despite the merits of organic farming and organic food, the intrinsic value and more importantly, its authenticity are not easy to differentiate from those are not organically produced. We called this feature of organic produce as “hidden characteristics”. The hidden-characteristics nature of organic produce could ultimately cause adverse selection, which means that the produce with less intrinsic value will actually be sold and purchased on the market, rather than the produce that authentically outstand. In The long run, the good produce will overstock and the bad ones will be traded on the market. Eventually, market failure occurs.
To prevent market failure in organic produce market, over the years, the government strived to build up a certification system, stressing the credibility of proofed organic produce. However, consumers are often confused by several legalized marks. In addition, there are several incidents that the so-called organic produce actually contains pesticide. The confusing organic authentication marks and the fraud organic cases make the official organic authentication less credible.
Currently, retailers are cooperating with several organic farms, building up its own supply chains. For those small size organic farms, it is never easy to find satiable retailer partners. And for those already worked with organic produce chain stores, they often received payment under 50% of price that the produce sold in stores.
For consumers who do not regularly purchase organic food, they consider that the price is too high and some of them do not have faith in official authentication. Compared with organic food stores, the product information is revealed a lot more on the internet websites such as some organic food e-commerce. But to those who buy organic produce frequently yet in a small amount, buying on-line impose them with lots of freight.
In order to fulfill the unmet needs of consumers and small size organic farm, this paper develops a new platform, a new business model to make it work. By means of on-line and off-line social network operation and group buy, the new model could stress credible authentication of organic produce. In addition, with lower cost, the model ensures a higher return for the farmers.
Subjects
團購
電子商務
社群支持型農業
虛擬社群
Type
thesis
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