Good praxis analysis and possible paths in order to obtain the best return for the typical agricultural and food productions

From Best Practices WIKI

About the “good praxis survey”, this section focuses on the given answers analysis of questionnaires of Greek and Italian entrepreneurs related to “Support and promotion of typical products” plan. The main goal is to comprehend the exploitation process of their products, difficulties coped, obtained outcomes, etc. After the outcomes analysis, the presentation of the scene of typical products scenario follows and the possible paths in order to obtain the best return for the typical agricultural and food products in terms of rules, tools and procedures.

Questionnaires Analysis: Outcomes

The Good Praxis about the valorization of the agricultural and food typical products in the two territories involved in the present plan (IT and GR), concerned actions and plans about strategies of communication and marketing, about innovations of product/process, about improvement of products quality, etc. Such experiences are concentrated in the area of Lefkada Prefecture and Corfu for Greece and in Bari and Brindisi Districts for Apulia Region. A “good experience”, as taken up in this survey, has included not only single plans but also other types of “pilot actions”, that is a sequence of plans considered like a whole set.

Table “Good praxis of Support and promotion of typical products plan””

Greece Italy
“Ladopita” Traditional sweet olive oil made Torre Guaceto Consortium: ”L'oro del Parco”
Mandorlato – “Saint Mavra” crayons Libere Terre Association
“Lefkadìtiki ghì” Wine (Lefkada) Puglia Natura Consortium
Lefkada Traditional Sausage Masseria Ferri
Patini Soap factory of Apostolos Patunis Bio&Tipico Project (Meas 4,8 POR Puglia 2000-2006)

From the analysis of considered experiences, is observed that, in some cases, the concept of “typical products” coincides with a category of products covered by one recognized denomination, generally defined by the communitarian regulations in matter; in other cases (GR) it coincides with those products that are linked to a certain territory, precise production modalities, tradition of some areas and that, however, apart the de facto acknowledgement do not show defined and formal credentials. In all Greek Italian experiences, comes out that, the “typical” product has a direct link to a determined territory and, mostly, to agriculture. One observes strategies of choices in favour of healthy products that have a certain meant and intrinsic value. That is, as an example, for those products which hold a communitarian stamp (project Oro del Parco, Puglia Natura Consortium), for traditional ones of Lefkada districts, for that ones which refers to ethical values (Libere Terre project) and, for the typical products in the measure in which these are recognized as specific and original values holders. To the question “Why this action/project is a good experience”, Greek partners point out with greater frequency the innovative feature of their projects (with reference, especially, to process and product innovation they have chosen). In order to add value to local products, the innovation is represented:

  • a) by the possibility to improve specific resources that have been left unused, or forsaken or underused – to innovate, actually, does not mean to recreate every thing from scratch, but it implies, above all, the necessity to profit by existent elements and a different use of know-how, knowledge, resources and structures, acknowledging the role of operators and involved people;
  • b) by a collective process that is recognizing and counting on an outgoing team that promotes a project and that is able to start up collective learning initiatives,introducing and trading new products and services;
  • c) by the competence to manage the testing and changing risk that is:
Support on risk taking on (funding, making operators responsible in all process steps, turning to research institutes, etc.);
Support to initiatives that foster the changing (synergies creation) and a “new local culture” ;
  • d) by the competence to provide optimized solutions against the requirements of rural areas (exploring new ideas, original compositions of new tools); of global context evolution.

Greek entrepreneurs, give also a positive feedback to promote the project integration, sustainability of their initiatives and transferability in favour of new situations. Critical states are highlighted in order to promote partnerships, “network systems” including private individuals and public ones for a general “bottomup” and “area based” criterion. Concerning the “area based”, even though some experiences are present in the area (areas approach), interviewees denounce infrastructural and institutional criticalities. Once they have been overcome, local entrepreneurs will get more advantages and more competition will be present in the area with doubtless benefits for the local growth and development. For apulian entrepreneurs’ interviews, instead, it is possible to notice consolidated approaches, methods and tools that characterize local development policies of last years: bottom-up approach, integration principles and resources-actions connection, partnerships, network actions, attest how the experience Leader+ succeeded on rural development and/or the strong participation of private and public subjects to the community initiatives Interreg that characterize the area involved in this survey.

Best Practices identification Criteria-Traditional Sausage from Lefkada

In the same time it is noticeable that, mostly, a territorial approach has been favoured. It is defined as opposition of the sectorial approach, it implies the needing of considering the actuality of the area under its different angles: environmental, economic, social, cultural, political, etc. “Territorial” approach allows local operators to establish a development policy based on facts, advantages (steady points), limits (lacks), needing and opportunity of a certain area. One remarks that “extraordinary” resources are not the only to be improved, on the contrary, in the most part, in facts, it can be opportune to re-discover an “ordinary” territorial heritage or a heritage considered “usual”. It is the case, in particular, of ancient know-how (soap at Corfu, traditional food recipes in Greece and Italy, etc.) that, once re-introduced and professionalized, creates new activities and value added. Integration process might involve:

  • local individuals and operators (both private and public or belonging to NGO, that think to be rivals or, being in the same place, they ignore each others);
  • projects and actions (in economic, social, cultural, environmental branches);
  • areas and relative resources (natural and cultural linked to heritage);
  • activity sectors (agriculture, handicraft, industry, trade, facilities, etc.)

This approach assumes that expected actions and projects do not have been planned individually and in a different way (for instance, training courses from one side and funding supports to create receptive units in rural farms on the other side) but, on the contrary, they must be one body in a whole strategy, and they must be correlated and coordinated coherently. A table, spotting Best Practices identification criteria, follows: (Source: n. 10 interviews – Attached A)

Best Practices identification Criteria Traditional Sausage “Lefkadìtiki ghì”Wine (Lefkada) Mandorlato –“Saint Mavra”crayons Ladopita”Traditional sweetolive oil made Patini Soap factory of Apostolos Patunis ”L'oro del Parco” project Puglia Natura Consortium Libera Terra Association Project 4.8 Masseria Ferri
Area based Approach YES YES YES YES YES YES --- YES YES YES
Bottom-up approach YES NO YES NO NO YES YES NO YES YES
Partnerships Approach YES NO YES NO NO YES YES YES YES NO
Innovation YES YES YES --- YES YES YES YES YES YES
Integrated approach YES YES YES --- YES YES NO NO YES YES
Creation of Net NO NO NO --- NO YES NO NO YES NO
Transferability YES YES YES YES YES YES YES YES YES YES
Sustainability YES YES YES YES YES YES YES YES YES YES

Overall, hence, from questionnaires it infers that:

  • e) Products added value is not only in its originality and quality, but also in

their local dimension. These experiences demonstrate that they have been able to highlight what makes a product typically local and so authentic.

  • f) In the strategy development and assessment on local products, it needs to

incorporate all those elements that make add more value, such as, integration of an innovative approach, for instance processing, trading and distributing local crops.

  • g) Usually, promoters of connection projects of local food products belong to

resourceful group of farmers that co-operate on agricultural markets or supply large dealers and distributors. In some Best Practices investigated, this kind of local food manufacturer is taking part more and more to networks which promote local food products. This kind of activity can also be considered as a feedback of a system that is more and more a centralized system of food production and supply, ruled by sale interests and large scale production.

  • h) Actual critical states of the system regard, above all, the lack of strong

trading networks, also for foreign markets, and the needing of an “umbrella” brand: a tool that allows to bargain and negotiate with the large structured distribution, keeping the own entrepreneurial identity. The main issue of local entrepreneurs is “the shelf”, that is the trading layout planning.

The typical products scenario and possible paths in order to obtain the best return for the typical agricultural and food products

Thanks to the Italian Agriculture Department that recently updated and elaborated the protected origins denomination Register (2007 October), DOCG, DOC and IGT wine registers (last updating 2007, September, 24th) as well as traditional products (7° review of National register of agricultural and food products, 2007 June) is possible to compare, for each product, number of obtained acknowledgements at national and regional level.

Traditional products 4330
DOC 314
DOCG 35
IGT 118

Nowadays, Italy[1] holds 164 Italian original products (109 DOP and 55 IGP) which in terms of productions, main references regard the extra virgin olive oil, fruits, vegetables, cereals, cheeses and processed meats, for a worth of 10 millions euro (7% total Italy). Thanks to 164 acknowledged denominations, on 741 in the whole EU[2], Italy holds the first position in the community list of origins denomination products, and detains 21,45% of the whole European market. In the second position there is France with its 152 products, Spain and Portugal with 104, and then Greece, Germany and United Kingdom, holding respectively 87, 67 and 29, until Finland and Slovenia with just one product acknowledged. In Italy the production worth is assessed around 4,6 thousands millions Euro that becomes 9,3 milliards at consumption level (1,8 milliards made abroad). Regarding traditional products, in 2007, Italian Regions raised 4330 traditional products; the main products are fresh and processed (1.193; 28,1%), meat (716; 16,8%) follows and cheeses (456; 10,7%). Noticeably lower instead it is the significance of other sections that are beverages (alcohol free, distilled products and liquors), animal products, fish and mollusks, oils and greases, seasoning and culinary products. In reference, instead to “quality wine”, at the end of 2007 there were 35 Italian wines that were holding the denomination DOCG seal, 314 DOC, and 118 IGT. At regional level (Apulia), instead, concerning community quality labels (DOP/IGP), MIPAAF updating 2007, October, one can observe 9 DOP and 3 IGP on a total of 12 quality products, as reported in the following table:

Quality products.jpg

Regarding traditional products, Apulia represents 4,4% of national whole holding the acknowledgement of 190 traditional products that in the most of cases are fresh ore processed vegetable (67) or fresh macaroni and bakery products (54). To finish the supply of traditional Apulian products there are 21 products of meat section, 15 of cheeses category, 12 alcohol free beverages, distilled products or liquors, 8 products in the fish and mollusks section, 8 culinary products, 4 animal products and 1 seasoning. Concerning quality wines at regional level, just like reported in the A attachment, 25 are DOC and 6 IGT. There are not DOCG denominations. Apulia Region anticipated, besides, the establishment of “Marchio Collettivo dei Prodotti Tipici Pugliesi” (Collective Mark of typical Apulian Products) that represents a sort of protection, in a private way, of products denomination, liable to public acknowledgement[3]. The Apulian scenario (2007, November)

Apulian scenario.jpg

With reference to Greece on reports the 2007, November updating for quality labels DOP and IGP divided by category of products.

Labels DOP IGP.jpg

Hence, overall:

Greek scenario.jpg

Valorization Paths for agricultural food quality productions: quality and collective labels

The productions diversification based on the territorial origins represents an option, for enterprises, their associations and local public institutions, in order to get to new markets and sale networks, as well as to keep market shares. In fact, enterprises look for new forms and methods of competition[4]. That is due both by the growing competition on production costs (deriving from an open market) and by changing occurred during the last community policy (CAP), that, de facto, frees grants of supports to specific productions[5]. The valorization process of typical agricultural productions does not set aside, therefore, a valorization action on markets that joins quality features of production to a system that can warrant the safety of consumers. In other words, the aim is a valorization process of local productions based on quality and warranties for consumers rather than production costs. In the agricultural food scenario it is possible to recognize different kind of seals which mark the quality of products and be part of the following regulations[6]

  • Community framework of quality labels (DOP, IGP, DOC, DOCG, IGT) and organic products;
  • National framework of traditional products (available only for Italy)
  • National frameworks for private or collective marks of member States.

The possibility to add value to such “different” products/tools is an indicator, nowadays, of the real capacity of the local agricultural food system able to differentiate its own productions based on criteria both qualitative and historical-traditional or linked to the area. Particularly, in the areas involved in the project (Apulia and Greece), agricultural food systems, even showing off their leader positions (like in Italy for instance), in terms of production quantities related to quality productions (organic, traditional, DOP, IGP, DOC, DOCG, IGT labels), do not succeed, likewise, to obtain a right acknowledgement in the main national and European markets. Such marks, hence, can be an useful tool to add value to typical products and for origin areas, providing that an analysis costs and benefits is done before. The geographic origin element cannot be “pirated”. Of course, this model provides benefits only when the geographical origin assumes a discriminant value in the options available for consumers and in the intrinsic and indivisible quality of the product. Typical products are in a market – the food one – with a competition that is year by year more intense. For this reason the commonplace that a brand is enough, in order to obtain a market success, has to be discredited. One needs to give a service back to the local agricultural economy. The point of reference for market development is still the consumer and the investigation highlighted that, in this branch, it exists a serious lack of knowledge and information. Nevertheless typical product can aim to more profitable markets, is still subjected to competition of alternative products, typical and a-typical. For this reason, the efficiency of enterprise and industry is a priority exigency even in the typical industries. Structural limits of agricultural and agro-industrial model still remain: from the industrial pulverization to the problem of generational replacement and so the ageing of entrepreneurial population, to the scarce innovation level. Rather quite the nature and basic characteristics of typical industries make to connect the most disperse part of agricultural farms and crops processing firms. Besides, it is noticeable the aggregate efficiency of entrepreneurial subjects together in the typical industry, with many problems and constraints to define organizational efficient models for a system based on micro enterprises needful of offer homogeneity, construction of well defined qualitative levels and process certification. In the industry, besides, other constraints are the main market interlocutors: industry and distribution. Today local products development is not included in the priority strategies of such enterprises that, consequently, do not represent the “flywheel” of the sector development. Nevertheless it seems emerging signals of a new interest of distribution chains to products able to introduce significant levels of diversification, and so valorization, of offers in the individual stores. One reports in the next table possible valorization tools of agricultural and food productions, showing the related rule, of reasons that determined the choice of a tool rather than another, critical aspects to cope, competitive advantages, recipients of such advantages and finally correlated strategies. Valorization Paths for agricultural food quality productions: quality and collective labels

Valorization paths.jpg

Valorization paths tradiotional products.jpg

Valorization paths voluntary certification.jpg

Costs-Benefits Analysis of geographic denominations (DOP and IGP)

In this section, is analyzed the “costs-benefits” issue related to corporate decision to start up a registration procedure DOP/IGP. How it will be shown, variables in the field will be very high and very often not easy to quantify and assess. They depend both on the characteristics of single enterprise and on the whole productive system. The choice to adopt a geographic Denomination results from a careful economic costs-benefits analysis. The cogency of the Denomination depends from one side on reduction of utilization costs, and from the other side on obtainable benefits increasing. Generally, decision about whether or not to use the Denomination is part of managerial strategy that characterizes single enterprises, and particularly of typology of target markets and demands of intermediate and final customers, and of course of human and physical resources of the firm. Concerning the business size, one observes that most of enterprises that operates in systems linked to typical productions are PMI (small medium-sized enterprises), and very often they are directed to trade on local sale networks where DOP-IGP does not provide any particular informative value and/or warranty qua there are other issues (trust, geographical and cultural proximity). On the contrary, for enterprises that operate on long/modern networks, Geographical denomination appears a very effective tool. One reports a resume about the main costs and benefits (short term) related to the geographical denomination choice (DOP, IGP).

Costs benefits analysis short.jpg

Concerning the “costs”, one observes that a more careful redaction of the production disciplinary, supported by an efficient collective organizing, can provide a less difficult use of denominations, particularly for small products and for small enterprises. In fact such costs depend on the way the disciplinary is made: an excessive specification of less considerable details, can involve both a direct costs increase (i.e. analysis, consulting) and an indirect costs increase (i.e. not conformity), pre-empting the convenience to denomination use. Concerning “benefits”, one reminds that large part of success of Denomination is linked to the importance of geographical name used. Very often, some Denominations are registered just with the goal to “create”, more than “defending”, a reputation linked to the geographical name. In these cases, where often the registering initiative is strongly wanted and supported by local public institution networks, the scope is to stimulate and restart the local economy taking advantage of the “medal effect” that comes from community protection concession. As much often, however, enterprises are not sufficiently involved and/or interested, for real difficulties to get profits in the market of Denomination or because the honour of their brands is higher than the denomination seal. In this instance, the denomination mark would smooth the message about the quality level of the product at consumer level. In these cases it should be necessary to build and/or maintain the reputation through collective and/or public actions. In conclusion, it is opportune to consider that, in the business decision to start up a community acknowledgement procedure there are 4 precise elements; consumers, market, competition and rural development. In fact, alimentary consumption model changed very much against a different perception of life quality. Buyers display new needs that can be satisfied by intrinsic specific properties of the product (sensorial characteristics, nutrition facts, genuineness, food safety, etc.) and extrinsic (typicality, traditions, ecocompatibility, animal welfare, ethical features of the product, etc.). They are, besides, interested to establish strong connections with cultural identities of original areas; Under the market point of view, like already said, European quality labels can be used by enterprises as a differentiation quality tool to avoid the competition on the production costs side. In the same time, strong reputation that characterizes most of typical products has to be protected from limitations and usurpations to provide a correct and loyal image (unfair competition); In the end, for the multi-dimensional link to the area, typical products can give a good hint to the rural development, keeping traditions and cultures, social and economic vital systems, especially in disadvantaged areas, providing a “flywheel” effect on the local economy.

  1. Mipaaf Updating, 2007
  2. At European level, EU - source: registrations database of quality products – European Commission, 2006
  3. The mark is registrable in any Chamber of Commerce or directly at Italian Patents and Marks Office according to specific procedures.
  4. Among different ways of competition chosen by enterprises, a particular importance is assumed by the offer of new facilities (according to multi-functionality principle) apart a research based on quality productions. New facilities, very often, does not fit in the traditional package of agricultural activities (agritourism, social agriculture, school factories, environmental protection and biodiversity, etc.), nowadays, those facilities allows to sustain and re-generate the agriculture in some rural places where agricultural practices are decreasing.
  5. The Decoupling System introduced by the last reform of Community Agricultural Policy – CAP (June 2003)
  6. In the following chapters is described the normative framework that rules the sole seals and some procedure to activate quality labels.