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Relational exchange and partnerships: the Ipanema Coffee case

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Organizações Rurais & Agroindustriais

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Programa de Pós-Graduação

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The case studied, Ipanema coffee, illustrates how market demand for high quality product conducted the company to build longtermrelationship with its suppliers, the farmers, in order to guarantee access to high value consumer international markets. Datawas collected through in-depth interviews with the major company shareholder and also with the marketing director along withdesk research for the coffee sector panorama. The long term contract appeared as a prosperous alliance strategy in the measure thata) reduces the risk related to the coffee quality attributes, b) creates a competitive advantage though the appropriability of specificassets related to the coffee growing and processing, c) permits the creation of a brand name capital. The relational exchange hasbeen successful once it allowed the firm to export 1 million bags for 25 countries. On the other hand, as expected in partnerships,the other party, the farmers, has incentives to continue the relationship, once it permits: a) international market access, b) premiumprices, c) risk minimization with hedge operation, and d) no investment in coffee processing structure.

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ALMEIDA, L. F. de; SPERS, E. E. Relational exchange and partnerships: the Ipanema Coffee case. Organizações Rurais & Agroindustriais, Lavras, v. 18, n. 3, p. 203-213, dez. 2016.

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