Farmers’ Choice of Marketing Strategy: A Study of New Zealand Lamb Producers

The red meat industry is of utmost importance to New Zealand’s economy, generating $2.8 billion in export earnings, accounting for 6.5% of the total merchandise export value in 2010 - 2011. However, sheep numbers fell substantially from 70 million in 1982 to 31 million in 2012. This has led to large-scale rationalization within the processing industry, causing major processing companies to now focus on in-house performance, including external relationships with suppliers and downstream customers. Yet, there are still openly adversarial relationships between processing companies and farmer suppliers with a prevalence of spot market relationships between many producers and processors. As the industry attempts to determine how to improve performance, a clearer understanding of producers’ selling behaviors and the drivers behind such behaviors is needed in New Zealand to effectively move towards a more comprehensive and sustainable procurement strategy for the industry. This research provides insights into why, and what influences why individual farmers chose various selling channels within the lamb meat supply chain