Local and Multinational companies in the agrifood sector: case studies

Abstract

The analysis and the study of the global food industry demonstrate clearly that this sector is characterized by few very large companies, the multinational companies (MNCs). Their widespread presence, makes these companies extremely powerful players in the food worldwide arena. The food sector is composed at the same time, by a great amount of relatively small companies (compared to the MNCs ones) that could be benefited by the vertical integration (from production to consumption), but that are geographically limited (defined as Local Companies). In order to have a better understanding of the food sector, the analysis of the agribusiness as a whole is crucial. At first by having an institutional and regulatory framework of how the agricultural sector is supported by the public actors and how it is globally measured by the OECD indicators. The recent political and economic reforms undertaken by the new Common Agricultural Policy (CAP) and the new Farm Bill (Agricultural Act of 2014), show that financing the agricultural sector remains a central and current topic in the European Union and in the US, representing the highest supported sector of their economy. Business models are consequently affected by the regulations and the public supports that the governments give to the agricultural sector. Case studies are taken into account. An inner examination of the US commodity trader Cargill is given, as multinational company business model, whereas a deep insight is offered for the companies Rigoni di Asiago S.r.l., Gruppo Veronesi S.p.A., Bisol and Distilleria B.lo Nardini, in order to settle the local company guidelines as business models. By presenting these companies, representing the two types of business model (multinational and local), it appears that different business models can coexist inside the food sector. The local company business model can be an “alternative” business, economically sustainable and exported outside its “natural” and geographical context.