Feasibility study for voluntary chains in the Polish food distribution system

Voluntary chains are affiliations of independent retailers with an independent, sponsoring wholesaler. Some of the more well known voluntary chains are Spar in Europe and I.G.A. and SuperValu in the United States. The Polish food distribution system is undergoing a dynamic transition from central state control to private entrepreneurship. In the process the system is becoming quite fragmented and economies of scale in food distribution are largely unrealized. While consumers spent approximately 40% of their income on food prior to 1989, they now spend 50-60%. The Polish Government wants to encourage entrepreneurs, but it is increasingly concerned about the excessive number of intermediaries that have appeared with the fragmentation of the system. Voluntary chains could potentially decrease this fragmentation, providing benefits to manufacturers, wholesalers, retailers, and consumers. They entail wholesaler-retailer coordination and cooperation to achieve buying economies, joint merchandising and promotional programs, and other improvements. Closer wholesale-retail coordination helps both wholesalers and retailers to increase operational efficiency, thereby decreasing costs and retail prices. To determine the feasibility of voluntary chains in Poland, a diagnostic study was conducted of the dry grocery distribution system. Dry groceries (non-perishables) were focused on because they represent the largest single share of consumer food purchases, and voluntary chains have traditionally been organized around their distribution. Only later as voluntary chains become established are the more risky perishable products incorporated. This study examined the structure of the dry grocery subsector at the wholesale and retail levels in the capital city of Warsaw. Both opportunities and barriers to the creation of voluntary chains were explored. Throughout the study emphasis was placed on understanding the roles and participation of women in the food marketing system. Consideration was given to how the potential introduction of voluntary chains would affect women"s roles and authority. (Author abstract)