ISSN 2526-1746

JOURNAL OF
GEOESPATIAL MODELLING

ANALYSIS OF THE FUNCTIONING OF THE SUPPLY CHAIN

MANAGEMENT OF BROILER CHICKEN
Luan Fernandes Rodrigues1; Roberta Gomes Marçal Vieira Vaz1; Ricardo Niehues Buss1*, Daniel
Martins da Silva1
1Federal University of Tocantins, UFT - Logistics Tecnology Course. Araguaína/TO, Brazil.
*Corresponding author: rnbuss@gmail.com

Key words: ABSTRACT

Agribusiness; Supply
chain; Broiler Chicken
Production Chain,
Integrated System.
The agribusiness sector has gotten significant performance in the national economy. Within
the agribusiness, the broiler chicken production has outstanding performance, due to its
association with the production of corn and soybean grains and by the organization of its chain
through the integrated production system. With the increasingly globalized market, the
production of broilers chicken has reached levels that the agents within the chain must look
for strategic plans to obtain the maximum profit, being the supply chain management an
administrative tool that seeks productive efficiency, costs decrease within the chain and
obtainment of higher value added of the product. The methodology used was a literature
review for approach concepts of supply chain management, visualize the functioning and
composition of the productive chain of broiler chicken with the aim of analyzing and
understand this chain, and identify its agents, making the interaction with management
concepts of the supply chain. Being the market increasingly demanding in terms of product
quality, looking for ways to optimize the production process makes them reduce costs and to
become economically sustainable in long-term. It is also important to highlight the significance
that should be given to the distribution of income in all links of the chain, allowing the
maintenance and investments of all agents in the production activity.

INTRODUCTION activities that have been constantly highlighted we

find the trade in grains and meat, especially
Agribusiness is an economic sector of the
soybeans and poultry, cattle and swine trade
country that has stood out in the national and
(CEPEA, 2013; VASCONCELOS and SILVA, 2015).
international scenario, being responsible for
The broiler chicken production chain
22.80% of the national GDP with R$ 1.02 trillion in
comprises the agribusiness sector and has gained
2013 according to the Brazilian Confederation of
international recognition due to the organization
Agriculture and Livestock (CNA) and which has
and dynamism presented by its chain in the format
come in imminent growth in the recent years. This
of the integrated production system. With this, it is
constant development makes Brazil one of the
important to have a good interaction and
largest food producers in the world. Among the
relationship between the agents involved in the

Journal of Geospatial Modelling, v.3, n.1, p. 1-11

production, seeking the mutual benefit of all
involved parties, ensuring sustainability and long-
term survival of the system (BELUSSO and
HESPANHOL, 2010; CALDAS et al., 2015).
The production of broiler chicken is
interconnected with the production of corn and
soybeans, and with the possibility of record
harvests in the coming years of these crops, an
increase in chicken production is also foreseen for
the coming years. The increase in chicken
production will have a major impact on production
costs, being the feeding factor responsible for about
70% of the costs of animal breeding, being
important the development of improvements that
seeks the maximizing of these processes and
consequently cost reduction (RIZZO et al., 2010).
Besides the nutritional aspect, other management
strategies may be adopted so that the profitability
of the system enables the survival of all the agents
in the market, something of great importance for
the proper functioning of the productive chain.
The management concepts have arrived at
the management of the animal breeding farms,
considered as companies of the rural scope, through
the change of the concept of "inside the gate" in the
Rural Administration also gave space to the system
of "outside the gate" in the management of the
activities inside of it, consequent effects of
Globalization, which may mention the increase in
competitiveness and consumer demands,
influencing the economic factors involved in the
marketing of products as market price.
This study aimed to analyze and understand
the functioning of the broiler chicken production
chain and to identify the agents in the system,
Journal of Geospatial Modelling, v.3, n.1, p. 1-11
interacting with management concepts over the
supply chain. Thus, seeks to obtain a broad
understanding of all the agents that integrate the
productive chain of broiler chicken, as well as to
visualize possibilities of interaction of the
administrative concepts of supply chain
management with the general model of the chicken
production chain and to focus on the importance of
the breeder/slaughterer relationship for an
effective operation of the activities.
The methodology used was a
bibliographical review to approach the concepts of
supply chain management and visualization of the
functioning and composition of the productive
chain of broiler chicken, also approaching the
importance of this chain to the national economy
and future perspectives.
This review is justified by the increase of the
competitiveness of the market that requires a
standardization and improvement of the quality of
the products offered by the distributors or retailers,
influenced by the fact that the economy has become
globalized and enabled the increase of exports of
these products. FAÇANHA et al. (2010) discussed
the trade barriers made by countries for the
acquisition of products, requiring hygienic-sanitary
and qualitative standards of the products and even
animal breeding (for example, production with
environmental sustainability). These processes
may assess the production costs, making it
necessary to adopt the strategies that make feasible
or make effective the activities between productive
links, generating greater profits for the system.
SUPPLY CHAIN
 The production and commercialization of
the products receive more pressure from the
market, due to the increasingly fierce competition,
influenced by a series of factors such as the diffusion
of new technologies for the transmission of
information and the increase of the importance of
the logistics in the transport and storage services of
the products generated in the industry (SOARES et
al, 2008). According to VALE, AMÂNCIO and LIMA
(2006), companies had the need to seek innovations
and adaptations to remain competitive in the
market due to this evolution, forcing the search for
partnerships with other organizations, forming
business networks that aim the maintenance, aid,
and innovation of your services and products.
The integration of other companies into a
production process and commercialization of a
particular product linked to the search for better
conditions that promote cost reduction, profit-
making and competitiveness with competing
companies led to the development of the idea of
supply chain and interest of its management.) The
integration of the supply chain has changed the way
of conducting business, encouraging managers to
offer to the customer's products or services with
greater advantages than competitors, highlighting
that this result is obtained in an integrated manner
and not in the isolated way (MOORI and ZILBER,
2003; VOILA and TRICHES, 2015).
The Supply Chain is a considerably new
term, revealing its importance from the beginning
of the thinking of integrated logistics between
companies that took place in the 1950s. The supply
chain is comprised as all activities that have relation
with the flow and transformation of merchandise
Journal of Geospatial Modelling, v.3, n.1, p. 1-11
going from the raw material to the final customer,
in addition to the exchange of information among
the members of the chain, knowing that materials
and information travel along the chain (BALLOU,
2008).
The supply chain conglomerates all stages of
customer care requirements, including producers,
suppliers, transporters and the customer itself as
participatory agents in this process and the
management of this chain involves all the control of
the flows that exist between each phase, seeking
greater economic return of the investment in
production (CHOPRA and MEINDL, 2003).
Thus, supply chain management will
become essential for business planning due to its
function of seeking advantages in the process of
generating the product, such as reduction of
expenses at some stage or during the production
process, as well as giving guarantees to offer
products of the best quality to the consumer. The
importance of generating knowledge and managing
them seeking an entrepreneurial management in a
company and its supply chain is one of the
cooperating technologies for a better performance
of the companies in the business world (FELÍCIO
JÚNIOR, 2005).
SUPPLY CHAIN MANAGEMENT INTEGRATION
The main aim of supply chain management,
according to RODRIGUES and SANTIN (2004) is to
do the integration between all the processes that
involve since the manufacturing until the product
distribution, aiming cost reduction of the
production and values aggregate through the
functions to attend the needs of the final consumer
with the shortest time possible, from the order reasons for the operation of the chain is the
attendance to the product delivery. alignment of the aims around the level of the
The integrated logistics vision in the supply desired service (PRADELLA and SILVA, 2005).
chain has made the company that generates a given
product has the concern both with its suppliers of SUPPLY CHAIN STRUCTURE
raw material, as well as with the retail companies,
In its basic composition, the supply chain is
being that to have a greater efficiency of the supply
made up of suppliers, manufacturers and the final
chain is needed that the agility and speed in the
client, may be able to have intermediate or
exchange of information and also in the availability
complementary agents to those mentioned above,
of materials so that it may attend the final consumer
such as the existence of distributors and retailers
satisfactorily.
between the manufacturer and final client
A paradigm that was broken by the origin of
relationship, and may also have outsourced
the integrated management was that of limited
companies responsible by specific services within
vision only in the interests of a company, without
the company's production as transportation and
the concern for the environment outside of such
information technology.
company. In the modern context of the market,
Figure 01 below shows the format of Supply
plans seeking the relationship with other
Chain Management as well as the integrated
organizations is an advantage that may be exploited
logistics processes, such as inbound logistics,
to increase the competitiveness of companies in the
internal logistics, and outbound logistics.
market, externalizing their actions and expanding
goals for other agents involved (MENDONÇA,
Flow of materials
2007).
Flow of infor mation
Thus, the importance of obtaining
advantageous prices from suppliers and having
distribution channels with efficient functioning to I nbound Outbound Final client

I ntegr ated logistics

attend the demand of products as well as the I nter nal
Supply logistics Distr ibution L ogistics
logistics
adoption of better practices by the manufacturing
company, emphasizing the shared interest of the Figure 1. Supply Chain Management and Integrated Logistics.

development of all the components of the chain

In the chain structure, there is a flow of
(VOILA and TRICHES, 2015).
materials going from the supplier to the final
In the interrelationship between
customer, having the transfer of product from each
companies, the manufacturers aim to keep storage
agent in the chain. Parallel to the material flow is
management constant and to have availability of
observed a financial and information flow,
materials at moments that are required and of
responsible for the economic transfer of the
adequate quality from suppliers. One of the main
product to the agents and data of the market

Journal of Geospatial Modelling, v.3, n.1, p. 1-11

demand (client needs). It is also important to
expose the existence of a more complex system that
promotes the return of the product and its waste for
recycling and reuse, being denominated as Reverse
Logistics.
On supply chain agents, SCHIER,
LOMBARDO and CARDOSO (2012) characterize
suppliers such as those who offer materials or
services and who have great relevance in the
production process, requiring a rigorous selection
to form partners, seeing the demands of quality of
the requirements of the market that keeps
companies fit for growth and business progress.
The relations between each of the stages
within the chain may also be analyzed through
cyclic vision, where the link between the supplier
and the manufacturer is called the supply cycle. This
cycle integrates the manufacturer and the supplier
and is understood as the fundamental means for the
availability of materials at the right time, without
problems of delay in the manufacture (CHOPRA and
MEINDL, 2003, RIBEIRO et al., 2008).
BOWERSOX, CLOSS and COOPER (2006) say
that interest in supplier development and
narrowing of interactions is needed, by working
with them for continuous improvements and
developing the interest in the purchasing
organization's progression so that may succeed in
the purchasing materials with adequate quality and
quantity, ensuring good progress to attend the final
consumer and generating economic efficiency for
the company.
BROILER CHICKEN PRODUCTION CHAIN
Journal of Geospatial Modelling, v.3, n.1, p. 1-11
The productive chain of broiler chicken in
Brazil has been outstanding in agricultural activities
for its national and international economic
performance. Brazil is one of the largest producers
and is the largest exporter of chicken meat in the
world, including products derived from it that
undergo industrialization and have higher benefit.
Figure 2. Brazilian Chicken Meat Production from 2000 to 2012
(in millions of tons). Source: UBABEF (2013)
According to the 2013 annual report of the
Brazilian Poultry Union (UBABEF) showing data on
poultry production in the country in 2012, the
national production of chicken meat in 2012 was
12.65 million tonnes (about 1.054 million of
tons/month), ranking third in terms of the world,
staying behind the United States (16.476 million
tons) and China (13.7 million tons), being 98% of
products in natura and 2% of products resulting
from processing. It may be observed in Figure 02
that the national production presented a slight fall
between the years 2011 and 2012, which contrasts
with the growth presented in the previous years
(2000 to 2011), being this fall mainly due to the
problems in the production of soybeans and corn in
the country and in other countries, resulting in the
increase of the prices of these inputs that integrate
the feeding of these animals as main sources of breeding system. (GARCIA, 2009; VIEIRA;
energy and protein. CAPACLE; BELIK, 2006).
According to UBABEF (2013) of the total
produced chicken meat, 69% were for the domestic
market and 31% to exports (3.918 million tons),
dividing these products into cuts (2.143 million
tons), whole (1,418 million tons), industrialized
(180 thousand tons) and other products (177
thousand), generating a revenue of US $ 7.7 billion.
The main importers of Brazilian chicken meat in
2012 were Saudi Arabia (628.6 thousand tons),
Japan (382.6 thousand tons), Hong Kong (306.8
thousand tons), the United Arab Emirates (239.2
Figure 3. Chicken Slaughter by State in 2012. Source: Adapted
thousand tons) and China (227.4 thousand tons).
from UBABEF (2013)
In the Southern Region predominates most
of the national production (Figure 03), being
In this context, there is the importance of
responsible for 61.8% of production (30.39% from
chicken production chain in the economy of the
Paraná, 17.29% from Santa Catarina, 14.12% from
country, being a job-generating activity (according
the Rio Grande do Sul) and 73.4% of the exports of
to UBABEF, the activity is responsible for 3.5 million
the country's broiler chicken products (28.74%
direct and indirect jobs) and one of the most
from Paraná, 26.12% from Santa Catarina; 18.54%
profitable national agribusinesses in recent years.
from the Rio Grande do Sul). The per capita
According to BERNARDINO (2009), this evolution is
consumption of chicken meat in the country in 2012
due to the improvement in the qualitative
was of 45 kg per person.
parameters of the production through the
Although the highest proportion of
progression in the studies of genetic engineering,
domestic broiler chicken production is located in
management, and poultry nutrition, seeking to
the Southern Region, is the result of its pioneering
understand the requirements of the final consumer.
in this area, it is expected an increase in the
Therefore, the prospect are that the broiler
production in the Central-West Region due to be
chicken market in the country present an growth
found in this region the largest producer of corn and
influenced by the increase in meat consumption,
soybean in the country, basic ingredients in their
which in turn is driven by a series of factors, such
ration, and, consequently, seek lower expenses with
as: the lower price of the product resulting from
the nutritional part, responsible for the greater
better productivity in the breeding systems, the
proportion of the production costs of an animal
increase of the population income, and the diversity

Journal of Geospatial Modelling, v.3, n.1, p. 1-11

 of chicken products available for commercialization function of meat processing and commercialize
(GENTILINI et al., 2013; VOILA and TRICHES, 2015). with retail markets (supermarkets and butchers, for
example) until arriving at the final client (ZANELLA
ANALYSIS OF THE COMPOSITION AND et al., 2013).
FUNCTIONING OF THE CHICKEN BROILER CHAIN Emphasizing the biological chain, the same
author describes that the grandparent hatcheries
The Broiler Chicken Production Chain is
are usually controlled by multinational companies
made up of several agents from the suppliers of
and are responsible for the importation in search of
genetic material for breeding animals to the
improvements in the genetic pattern of the species
grandparent stock to the commercialization of the
produced here in the country through the crossing,
product and it may be illustrated in Figure 04.
the parent hatcheries form the breeding matrices
and, from these, the best eggs are selected to be
Factor y of equipment
Gr andparent hatchery
taken to the hatcheries and, finally, the chicken
and of chemical and
phar maceutical
supplies Parent hatcher y
breeders are responsible for receiving the chicks

Biological Chain
and needed management for growth and fattening
Feed mill H atcher y
of them hygienically until they reach the slaughter

Other supplier s Chicken breeder

Slaughterhouses Refr iger ator
W hole Chicken I ndustr ialized
chicken cuts
Super mar ket M ar ket place Butcher y Poultr y
Figure 4. Broiler Chicken Production Chain. Source: Adapted
from Martins, S. S. (1996)
The productive chain of chicken meat can be
subdivided in: biological chain, being found in it the
grandparent hatchery, the parent hatchery, the
hatcheries and the chicken breeders; nutrition
chain, where the activities of corn and soybean
planting and processing of ration in factories are
involved, being this ration provided to the animals
in the breeding; and distribution chain, including
refrigerator and slaughterhouses, which has the
age.
The grandparent hatchery, the
refrigerators, and the supermarkets are the three-
existing links in the broiler chicken production
W hole Chicken chain that have a greater power to set prices in
chicken cuts
Foreign relation to other agents (VIEIRA et al, 2006;
mar ket
ZANELLA et al, 2013).
Other s
The broiler chicken chain has been
organized through the integration system, where
there is a partnership through contract between
breeders and slaughterhouses that allows the
structural development of breeding by inserting
new technologies, greater technical assistance and
security for the monetary gains of the creator,
besides also having an economic return for the
company that industrializes and distributes the
product because there will be a better quality and
uniformity in the raw materials coming from these
suppliers and the opportunity to have a greater

Journal of Geospatial Modelling, v.3, n.1, p. 1-11

follow up of the stages of that production (FREITAS
& BERTOGLIO, 2001).
The integration system seeks to achieve the
following targets: fixed revenue without
interference from price changes in the market for
the integrated, improving the quality of the product
aiming at techniques that allow this improvement
in all stages of production, as well as economic
sustainability of the system with distribution of
income for all the agents and favor the growth of
production attributes that make the company
competitive in the world poultry meat market
(MARTINS, 2008; ZANELLA et al., 2013).
With the globalized market, the productive
activities must adapt and the companies have to
modernize their production actions, and changes
must be made in all agents of the production chain
of chicken meat, including the weakest links. This
system, also defined as vertical integration, allows a
better management of the producers on their
function in the productive activity part, besides
favoring a cost reduction in the relation between
the chain agents, being able to make that
management arrangement to adapt to the new
market requirements (VIEIRA JUNIOR et al., 2006;
ASCHE et al., 2018).
For GARCIA (2009), the dynamism in the
production of chicken meat is noticed in the
application of technology and of new methods both
in the product and in the processes for its
generation, being able to mention the several
diversifications that the chicken meat has for sale of
the product as a specific cut of the carcass (thigh,
breast) and other products with higher processing
(sausage, nuggets, etc.), each with a differentiated
Journal of Geospatial Modelling, v.3, n.1, p. 1-11
aggregation value and with adequate quality, being
a way to keep the economic growth of the sector.
Evaluating the progress of a total quality
plan in the integrators of a large broiler chicken
agroindustry, BERTA, FERREIRA and TALAMINI
(2008), concluded that the quality management in
this production chain has an importance both in the
improvement of the final quality of the product, as
also influences in a better use of it, during its
processing, reducing the losses, responding better
to the market, increasingly demanding with
qualitative standards that please the final
consumer.
For this reason, the productive chains have
to adopt administrative and management measures
that favor the growth of production and the system
with all the agents, taking attend the market
demand. ARAÚJO et al. (2008) suggest that all the
agents of the chain must be able to have adequate
monetary income for their function, allowing it to
maintain its activities and new investments in its
system, thus increasing the market competition
power, guaranteeing its economic sustainability.
Then, it is necessary the existence of a unit
of thought that seeks cooperation among all the
agents of the broiler chicken supply chain, aiming at
the operational processes within the company be
efficient and the relationship between producers
and integrators generate mutual benefits, obtaining
satisfactory results for all (SAKAMOTO & BORNIA,
2005).
BORGES, ORTIZ and NUNES (2009)
observed disharmony in the relationship between
the integrating company and breeders in a poultry
integration system in the southwestern of the state
of Paraná, being the deliveries the most harmed by
being threatened and suffer only if they do not
always invest in their breeding system and do not
dispose profits for their personal rental. Situations
like this should be avoided within the productive
chain because it could lead to long-term losses for
all agents.
Therefore, the integration system
stimulates the close relationship between each
agent and mutual assistance among them, leading to
the success of this activity at the national context,
overcoming the crises coming from the national and
international markets (JESUS JUNIOR et al., 2007).
The organization given by the coordination
between the links of the chicken chain also favors
the flow of information within it, making the
consumer market demands to be detected quickly
in relation to the product, which makes the
coordination of this chain as a determinant factor of
success or failure of the activity in the country
(LEITE et al., 2010; ZANELLA et al., 2013).
CONCLUSIONS
The Broiler Chicken Production Chain
acquired a relative stability over the years
regarding other animal production activities,
organizing in such way that allows a greater control
of information by institutions at national level,
bringing recognition of the international market of
their productive efficiency.
For the good performance of the chain, it is
necessary a good interaction between all the agents
involved in the generation of the product, since the
suppliers of raw material and supplies to the
distributors, aiming that the whole system is
Journal of Geospatial Modelling, v.3, n.1, p. 1-11
efficient and that becomes sustainable, given the
best possible way the needs of the final client.
Therefore, the relationship between producer and
company through the integration system should be
valued as well as the other relations along the chain,
making mutual growth exist in the links of the
production of broiler chicken.
The current market prospects makes with
the producer have to adapt to the new realities in
order to remain competitive and profitable, making
that the activities planning be of utmost importance
in order to see the progression of the system and to
reduce unforeseen events over time, giving greater
reliability for the producer to remain active in the
production system. The companies should also
adopt new policies for planning, suggesting the
supply chain management as one more equipment
to seek greater profitability in the activity, knowing
that the globalization of the market made it as there
was greater rivalry in the commercial activities,
forcing to look for productivity improvements and
reduction of losses coming from the production
process.
Research may be carried out with the
purpose of visualizing the management practices of
the integration system and how the relationship
between breeders and slaughterers in the Region,
looking for possibilities of improvements in their
productive performance, improving the production
in the state.
With the agribusiness being important to
the national economy, including the production of
chicken meat, mainly by the existing development
of this economic sector in the international market,
the commercial policies should require greater
reliability and quality of the products to attend the
requirements of import markets, beyond the final
consumer in the internal market.
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