Chapter 4 Forces Affecting the Distribution Systems

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Presentation transcript:

Chapter 4 Forces Affecting the Distribution Systems New

Economic Force Supply and demand Basic commodities are typically acquired through a bidding procedure Co-op farmers Established market prices Perceived value Perceived quality + Perceived services / EP cost

Economic Force, Cont. What is the difference between AP price and EP cost? Monopolistic competition

Political Force Lobbyists –The NRA Primary sources have the most influence Typically used to influence produce availability, prices, and channel member behavior

Ethical Force Define ethical behavior What is ethical? Codes of ethical behavior Examples

Legal Force Sherman Act (1890) Meat safety legislation Sinclair Lewis’ The Jungle Pure Food Act (1906) Meat Inspection Act (1907) USDA established in 1862 Primarily focuses on meat, poultry, and eggs

Legal Force, Cont. Meat safety legislation Poultry Products Inspection Act (1957) Wholesome Meat Act (1967) Wholesome Poultry Products Act (1968) The Federal Food, Drug, and Cosmetic Act (1906) FDA administers this law They evaluate contaminate levels

Legal Force, Cont. Seafood safety legislation PUFI for a fee FDA has the authority to examine seafood in interstate commerce. Federal Trade Commission (1914) Amended by the Wheeler-Lea Act (1938) It deals with advertising, deceptive promotions, monopolies,and conduct in the marketplace

Legal Force, Cont. Clayton Act (1914) Used to control antitrust violations Tying agreements Exclusive dealings Perishable Agricultural Commodities Act (1930) Control interstate commerce Prohibits unfair practices in sale of produce Added PAC (1930), EGM

Legal Force, Cont. Agricultural Adjustment Act (1933) & Agricultural Marketing Agreement Act (1937) Ensure steady flow of perishable products Robinson-Patman Act (1936) Known as the “small business protection act” Promotional discounts favoritism through a quantity limits provision Predatory pricing Gas station example Added AAA (1933) and AMAA (1937) EGM

Legal Force, Cont. Heart Act (1966-1969) Packaging pictorial aspects Misleading descriptions and illustrations Package label regulations

Other Laws Franchise law Contract law Agency law Title to goods Consignment sales Warranties Patents Rebates Added Graphic, EGM

Technology Force Genetically engineered foods Preservation methods Value added foods Transportation Computerization Packaging

Copyright ©2008 John Wiley & Sons, Inc.