Research on supply chain model innovation of
Fresh agricultural products in China from the
perspective of relationship stability
Baohua Sun1, Liping Han2, Xiaohui Liu4
School of Economics and Management
Inner Mongolia University of Technology
Hohhot,China
15228419@qq.com
Abstract—Fresh agricultural products have the
characteristics of seasonality, dispersion and perishability.
The stability of the supply chain of fresh agricultural products
plays an important role in the security of China's agricultural
products and the integration of production, supply and
marketing. In the traditional supply chain of fresh
agricultural products, there are problems such as poor
information, complicated circulation links and large logistics
losses, which lead to the inefficient operation of the fresh
agricultural products supply chain model. In order to
effectively integrate the production and circulation of
agricultural products in each link, to achieve the safe,
efficient, reasonable and orderly supply of fresh agricultural
products, based on the synergy theory, this paper proposes the
innovation of fresh agricultural products supply chain model
from information sharing, relationship trust, incentive
mechanism and other aspects to promote the stability of the
relationship
Key words—relationship stability ； fresh agricultural
products supply chain； model innovation
I. INTRODUCTION
"SAN nong" (agriculture, countryside and peasants)
has been an economic and livelihood issue concerned by
the Chinese government and all sectors of society, since
2004, the Central Committee of the Communist Party of
China and the State Council have designated the "SAN
nong" issue as the content of the Central No. 1 document
for 18 consecutive years. The main purpose is to promote
and improve rural infrastructure, and increase farmers'
income, improve agricultural production capacity,promote
the healthy development of agriculture. Among them,
agriculture is the foundation of economic development
and social stability.
Fresh agricultural products have the characteristics of
perishable, seasonal, regional, cyclical and vulnerable to
the impact of natural environment. Affected by the
cooperation mode and operation mode between the
upstream and downstream of the supply chain, fresh
agricultural products are faced with great uncertainty in
the production and sales links. "Production and marketing
uncertainty" leads to "difficult to sell", "expensive to buy",
"unsalable" and other problems in China's fresh
agricultural products market, which increases the
difficulty of fresh agricultural products management
decisions; The supply chain cooperation of all kinds of
Ganchimeg3
Graduate School of Business
Mongolia University of Science and Technology
Ulaanbaatar, Mongolia
fresh agricultural products is mostly short-term behavior,
the cooperation is not close, unstable, lack of long-term
effective mechanism. The supply chain of fresh
agricultural products specifically shows the problems of
large logistics loss, large price fluctuations, opaque
information, uneven distribution of interests of all parties,
and high default rate, which have resulted in damage to
the interests of consumers and fresh agricultural product
producers and affected fresh agricultural products. The
safety of agricultural products and the overall operation
level of the supply chain are low.
Stability affects transaction cost and response speed of
supply chain, which is an important guarantee for the
efficient operation of fresh agricultural supply chain
organization. This paper will analyze the supply chain
model of Fresh agricultural products in China from the
perspective of "relationship stability", explore the key
factors affecting the supply chain stability of fresh
agricultural products and the mechanism of the supply
chain model, and put forward the fresh agricultural
products supply chain model innovation to promote the
relationship stability. The innovation of fresh agricultural
products supply chain model is of great practical
significance for improving the overall performance of
fresh agricultural products supply chain, accelerating the
process of agricultural industrialization and promoting
rural development.
II. LITERATURE REVIEW AND THEORETICAL BASIS
A. Fresh agricultural products supply chain research
Fresh agricultural products refer to primary
agricultural products that are produced and managed by
farmers and are not easily preserved at room temperature,
usually including vegetables, fruits, meat, aquatic
products, milk and poultry eggs. The supply chain of fresh
agricultural products refers to a chain composed of a
series of links from production to the final arrival at
consumers. It not only connects the participants into a
network with overall functions, but also integrates
logistics, capital flow and information flow. At the same
time, it is also a value-added chain, which can effectively
reduce the risk of farmers individual trading loss, cost,
and logistics, etc.
The research on the supply chain management of fresh
agricultural products in China began in 1999 and started
relatively late. The research on the supply chain of fresh to maintain the normal fluctuation state and dynamic
agricultural products by Chinese scholars is still balance of the optimal overall performance of the supply
incomplete. Li Man [1] (2017) proposed that the time and chain
space barriers of fresh agricultural products should be
broken in China's fresh agricultural supply chain.The C. Synergy Theory
study of Fu Zhuo et al. [2](2018) shows that in the case of Synergy is a subject about collaboration. The so-called
supply chain transmission along a single logistics synergy is the coordinated work of all parts of a
direction, value-at-risk measurement can help to find the system. Synergistic effect makes the system have integrity
key nodes controlling risk transmission, and the and stability, and also reflects the determinacy and
optimization of the risk elements of the key nodes can purpose of system evolution. Due to the synergy of the
effectively reduce the value-at-risk of the supply chain.Yu system, various contradictions after coordination reach the
Yunlong et al. [3](2020) constructed three cold chain overall unity, and its overall function is amplified,
service modes of commitment, advance requirement and resulting in complementary effect, so that the overall
delay requirement, and discussed the impact of different function of the system is greater than the sum of the
modes on pricing, cold chain service level and enterprise functions of each component..The thought of supply chain
performance. Yu Rong et al. [4](2018) obtained the cooperation itself is the embodiment of the synergy
optimal quality decision of suppliers and retailers by theory. Supply chain enterprises around the improvement
taking the optimal quality effort level of suppliers and of the overall competitiveness of the supply chain to carry
retailers as the state variable. Zhang Xu et al. [5] (2017) out coordination, cooperation.The supply chain itself is
proposed a combined contract to coordinate the equitable not static, but dynamic. Coordination can make the supply
agricultural supply chain in view of the unequal status of chain maintain stability for a period of time. This stability
supply chain members. is based on the mutual running-in, mutual understanding
and mutual support of the member enterprises of the
From the definition of the supply chain of fresh supply chain until the final formation of complementary
agricultural products, it can be seen that the supply chain advantages and interdependence, which is not only
of fresh agricultural products mainly emphasizes beneficial to the member enterprises, but also conducive
its integrity and the stable cooperative relationship to the whole supply chain to create a win-win situation.
between each link.
III. FRESH AGRICULTURAL SUPPLY CHAIN STATUS
B. Research on the relationship stability of fresh AND ANALYSIS OF EXISTING PROBLEMS
agricultural products Fresh agricultural products are the commodities with
The stability of supply chain relationship is the the highest trading frequency in residents' life. China's
relative stability in the dynamic adjustment or fresh agricultural products supply chain involves
improvement of the supply chain. It is a state of numerous circulation links, and it has the market
equilibrium, rather than the maintenance of the trading characteristics of "producing and selling
relationship between two or more partners (Quan nationwide". According to statistics, the per capita cold
Xiaofeng, Yin Hongying (2007) [6], Tian Gang et al. (2015) storage capacity in the United States is 0.96m^3/ person,
[7]
);Building a dynamic balance structure of the supply that in Western Europe is 0.3m^3/ person, and that in
chain can reduce the opportunistic behavior of partners, China is 0.11m^3/ person, which is far from European
control the cost of switching, help the stability of the and American countries. Fresh agricultural products
supply chain, and prevent the supply chain from being mainly include vegetables, fruits, meat, aquatic products,
damaged due to changes in the internal and external milk and poultry eggs, etc. The production output of fresh
structure of the supply chain (Liao Chenglin et al. agricultural products in China from 2016 to 2020 is
( 2003)[8], Lu Xiaoli (2012)[9]).Whether the supply chain shown in table 1 below:
of fresh agricultural products can maintain stability
mainly depends on income distribution, cooperative TABLE I. OUTPUT OF FRESH AGRICULTURAL PRODUCTS IN
relationship, policy support, smooth information, quality CHINA FROM 2016 TO 2021
and safety and other factors, which are significantly Unit :（One Hundrde Million Ton）
positively correlated with the stability of the supply chain
(Liu Qi (2013) [10], Zhou Yefu (2017) [11], Li Lingjie (2018)
[12]
, Wang Lei (2019) [13], Yan Ximu (2020) [14] ).The Year
stability of fresh agricultural products supply chain has a Category name
direct impact on supply chain performance (Yang et al., 2016 2017 2018 2019 2020
2008 [15], Mao Yihui, 2008 [16], Sheng infantry, 2009 [17], Vegetable production 6.74 6.92 7.03 7.21 7.22
Zeng Wenjie, Ma Shihua, 2010 [18], Sui Bowen (2017) [19]). Fruit production 2.44 2.52 2.57 2.74 2.87
In short, there is an inseparable relationship between the
Meat production 0.86 0.87 0.86 0.78 0.77
relationship stability and performance of fresh agricultural
products supply chain. Aquatic products 0.65 0.65 0.65 0.64 0.64
milk 0.32 0.31 0.32 0.33 0.35
The study of fresh agricultural products supply chain
from the perspective of relationship stability can be Egg production 0.32 0.31 0.31 0.33 0.35
understood as that the key stable fresh agricultural a.
Unit :(tons) Source: China Statistical Yearbook, 2021
products supply chain is based on the continuous In the supply chain of fresh agricultural products, the
adjustment of cooperation among supply chain members members of the supply chain mainly include producers,
suppliers, logistics enterprises, distributors and consumers,
among which producers mainly include individual
farmers, professional large households, family farms,
agricultural leading enterprises, agricultural
bases; Suppliers mainly include large-scale wholesalers,
middlemen, farmers' cooperatives and third-party logistics
enterprises; Retailers include farmers' markets,
supermarket chains, e-commerce, wechat and
livestreaming platforms. After years of development, the
current agricultural product supply chain presents a
multi-mode integration development trend, integrating the
model centered on large wholesalers, the model centered
on chain supermarkets, the model centered on third-party
logistics enterprises, the model centered on agricultural
product processing enterprises, the direct selling model of
agricultural products, e-commerce, wechat and live
broadcasting platform, etc The supply chain mode of
traditional fresh agricultural products is shown in Figure
1:
Fig. 1. Traditional Fresh Agricultural Product Supply Chain Model
A. Large wholesaler - centered model
The mode of large wholesaler as the center mainly
refers to the sales mode of "producer - large wholesaler -
retailer - consumer". According to the statistics from the
Ministry of Commerce, more than 70 percent of China's
agricultural products are distributed centrally by large
wholesalers. As the core of fresh agricultural products
supply chain, large wholesalers connect production,
distribution, wholesale, distribution and retail links. In
each link, fresh agricultural products must be completed
in the trade negotiation, selection, sorting, classification,
packaging, loading and unloading, handling,
transportation, storage and other processes, increasing the
cost of circulation, and finally passed on to consumers
with high prices, which can not be traced and can not
guarantee the quality and safety. In addition, the
circulation link of this mode is relatively complicated. In
the process of purchasing agricultural products from the
field to consumers, multi-level middlemen are needed,
which will incur more transaction costs. At the same time,
complicated circulation links and bullwhip effect make
producers face greater market risks, and aggravate the
instability of fresh agricultural supply chain.
B. Chain supermarkets as the main model
The model with chain supermarket as the main body
refers to "producer-chain supermarket - consumer". Chain
enterprises with strong strength make use of their
advantages to form a unified procurement and stable sales
supply chain mode. The purpose is to use market demand
as a guide to promote farmers' production and realize the
promotion of agriculture by business. Supermarket chain
wal-mart, for example, often have mature procurement
logistics industry chain and fixed stable purchasing
channels. Due to the brand effect of chain supermarkets
and the excellent procurement network system, the types
of products they sell have been widely promoted, so they
have attracted many consumers around them and brought
them stable sales volume. In addition, more and more
chain supermarkets adopt the strategy of low price to
attract consumers, so in order to save wholesale costs,
they often directly omit the middleman and purchase
directly from the source producer.
The risk of this model focuses on the poor information
flow among the members of the fresh agricultural
products supply chain, , supermarket chain often occupies
the dominant position. The large-scale agricultural base
and agricultural leading enterprises have certain
leadership, while the family farm, professional investors
and the individual farmers scattered supply of agricultural
products and agricultural product quality is uneven, the
position is relatively low. Status inequality means
information asymmetry, poor information flow will
damage the interests of the disadvantaged party, and then
may destroy the cooperative relationship between the two
parties; At the same time, the logistics facilities
construction capacity of family farms, professional large
households and individual farmers is weak, especially the
cold chain transportation capacity is extremely low, which
leads to high logistics loss rate and logistics cost increases,
resulting in the instability of fresh agricultural supply
chain.
C. Third-party logistics enterprises as the core of the
model
The mode with the third party logistics enterprise as
the core refers to "producer -- third party logistics
enterprise -- chain supermarket/farmer's market --
consumer".This mode entrusts the distribution task of
each node enterprise in the supply chain to the third-party
logistics enterprise by signing a contract, and stipulates
that the third-party logistics enterprise and other members
of the supply chain share the distribution of benefits and
bear business risks. Through the third-party logistics
enterprises, the scattered fresh agricultural production
households are concentrated in the logistics center, and
then the logistics center distributes uniformly to the
enterprises and consumers at each node of the supply
chain, so as to realize the integration of resources on the
whole supply chain.This supply chain operation mode
mainly includes the following advantages: first, the
third-party logistics enterprises are responsible for the
management of fresh agricultural supply chain business
and integration of superior resources on the supply chain,
so that the enterprises on the supply chain focus on the
development of their own core business. Second, for other
enterprises in the supply chain except third-party logistics
enterprises, it can reduce the investment in logistics
infrastructure equipment and relieve the pressure of
capital turnover. However, in this mode, the disadvantage
is that logistics enterprises cannot grasp the market
information of agricultural production and sales in time,
and it is difficult to realize the effective connection
between supply and demand, which further aggravates the
uncertainty of fresh agricultural supply chain.
D. Agricultural products processing enterprises as the
core mode
The model with agricultural processing enterprises as
the core refers to "producer-agricultural processing
enterprise-supplier/retailer/consumer". In the supply chain
of fresh agricultural products, agricultural producers are
the weakest link, it is difficult to drive the operation of the
whole supply chain. However, processing enterprises
realize the continuation of agricultural products
production and provide a way to improve the added value
of agricultural products. In this mode, processing
enterprises are responsible for agricultural supply chain
management, selecting appropriate suppliers, retailers and
consumers, and making reasonable production plans.
Agricultural products processing enterprises as the
core of the model, its sales in a variety of forms. First,
after primary processing, raw materials are directly
provided to suppliers or retailers in the form of
agricultural and sideline products at a higher price, and
then to consumers; Second, many fresh agricultural
production bases are open to consumers in the form of
farmhouse. Consumers can directly enter planting and
breeding farms to pick and buy agricultural products.
This mode mainly includes the following advantages:
first, as the core enterprise of the fresh agricultural supply
chain, processing enterprises are conducive to reducing
the market risk of producers and forming large-scale
production, so as to reduce the production and processing
costs of agricultural products and the transaction costs
within the supply chain. Second, processing enterprises
often have advantages in capital, technology and means of
production. They can make use of their ability to control
the market to ensure the stability of the entire agricultural
supply chain. However, this model also has some
limitations. For example, it requires high management
level of enterprises. If enterprises cannot be managed
scientifically and effectively, it is difficult to form
economies of scale effect.
E. Farmer direct sales model
Farmer direct selling model is "producer-
consumer". Farmer direct selling mode refers to the direct
sale of fresh agricultural products from producers to end
consumers, bypasses suppliers and retailers. In the
producing areas of fresh agricultural products in rural
areas, producers sell fresh agricultural products directly to
consumers in market towns or specific business gathering
places, which reduces the suppliers and retailers in the
intermediate link, saves circulation time for agricultural
products, and thus improves freshness. However, this
sales model is difficult to large-scale promotion.It needs
to be in the production area of fresh agricultural products
or in the area close to the production area, so it is difficult
to form economies of scale.
F. E-commerce, wechat business and live broadcast
platform mode
The mode of e-commerce, wechat business and
livestreaming platform refers to "producer--e-commerce,
we chat business and livestreaming platform/
consumer". The rise of e-commerce, wechat business and
livestreaming platforms has omitted the intermediate
wholesale link, thus making commodity circulation
smoother and commodity prices more
transparent. However, the main risk of this mode lies in
the e-commerce platform merchants themselves. For
consumers, the commodity information advertised by
e-commerce is difficult to distinguish between true and
false, and the quality of goods is also uneven, which
highlights the issue of interest fairness. Meanwhile, the
logistics service is unstable, which leads to the high
circulation cost of this mode.
To sum up, from the six modes of fresh agricultural
supply chain, it can be seen that producers are dispersed
in operation, responsible for their own profits and losses,
and the cooperation between enterprises at the nodes of
the supply chain is not coordinated; From the field to the
consumer, the circulation link is long and
complex; Agricultural products are easily restricted by
natural conditions such as season and climate, and market
demand fluctuates greatly. Uneven quality of agricultural
products, unequal status, information asymmetry, low
cold chain transport capacity, etc. Therefore, typical
problems existing in the supply chain model of fresh
agricultural products can be summarized as follows :
First,high uncertainty risk; Second, The information flow
of supply chain node enterprises is not smooth;Third,
Fresh agricultural supply chain has higher requirements
on logistics;Fourth,]Supply chain node enterprises only
pursue the maximization of their own interests. All these
increase the uncertainty of fresh agricultural supply chain.
IV. RELATIONSHIP-STABLE FRESH AGRICULTURAL
PRODUCTS SUPPLY CHAIN MODEL CONSTRUCTION
From the perspective of relationship stability in the
fresh agricultural supply chain, nodal enterprises need to
constantly adjust the cooperative relationship to maintain
normal fluctuation and dynamic balance of the alliance
relationship, so as to maintain the optimal overall
performance of the supply chain.
Step 1: Identify the main key factors affecting
economic, environmental and social performance in the
fresh agricultural supply chain, including information
sharing, relationship trust, incentive mechanism and other
factors;
Step 2: Take the relationship stability platform as the
core, use big data, Internet of Things and other
technologies, according to the synergistic effect, through
the behavior of enterprises at multiple nodes in the supply
chain, dependency and integration of external
environmental resources;
Step 3: Each node enterprise in the supply chain is
constantly exchanging information flow, logistics, capital
flow and other aspects. This exchange will make fresh
agricultural supply chain system in a normal state of
fluctuation and dynamic balance;
 Step 4: Build a supply chain model of fresh
agricultural products with stable relationship. Fresh
agricultural products from producers, suppliers,
third-party logistics, distributors to consumers and the
government are dynamically balanced flat network supply
chain. Construction of fresh agricultural supply chain
model with stable relationship, as shown in Figure 2:
Fig. 2. Relationship stable supply chain model of fresh agricultural
products
A. Information Sharing
Information sharing can ensure the unimpeded
information in each link of the fresh agricultural supply
chain, so that the nodal enterprises in the supply chain can
arrange production and operation reasonably according to
the obtained information. Synergies play an important role
in eliminating information asymmetry and imbalance
between production and marketing. The relationship
stabilization platform is the "integration center" of
information, which integrates the supply and demand
information resources between node enterprises in the
supply chain through coordination effect; The relationship
stability platform is the "dispatching center" of fresh
agricultural products logistics activities, which integrates
the information resources of logistics demand and supply
through coordination effect; The relationship stability
platform is the "service center" of market demand changes,
which integrates market demand changes and government
policy restrictions and other information resources
through coordination effect; It enables the node
enterprises of the fresh agricultural products supply chain
to continuously and dynamically adjust the cooperative
relationship of each enterprise, maintains the normal
fluctuation state and dynamic balance of the chain, and
promotes the stability of the relationship of the fresh
agricultural products supply chain.
B. Relationship Trust
The overall performance of fresh agricultural products
supply chain depends on the coordination level and trust
level of cooperation among enterprises at each
node. Stable platform with the aid of synergistic effect, on
the one hand, through a system of ethics, reputation,
groups such as social pressure, limit the opportunism
behavior of individual enterprises, promote the supply
chain node enterprises obey the rules of the group, fresh
agricultural products supply chain relationship of partners
regulate their various behaviors according to these rules,
so as to achieve the trust of cooperative relationship; On
the other hand, the sharing of resources and information
among nodal enterprises in the fresh agricultural supply
chain improves the overall competitiveness of the supply
chain, thus forming the cooperative relationship trust
mechanism of nodal enterprises. The relationship stability
platform will make the node enterprises in the fresh
agricultural supply chain trust and adjust each other, make
adaptive changes, and improve the life of the fresh
agricultural supply chain and the stability of the
relationship.
C. Incentive Mechanism
Fresh agricultural products as a special product, fresh
agricultural supply chain operation has great instability,
suitable incentive mechanism can make fresh agricultural
supply chain more stable. With the help of the synergy
effect, the relationship stable platform considers the fair
distribution of benefits and contract incentive. First,The
relationship stability platform implements the profit
redistribution mechanism of the fresh agricultural
products supply chain. Through the partners signing the
profit redistribution contract, the total profit of the
agricultural products supply chain is redistributed
according to a certain proportion, ensuring the "fairness"
of farmers, suppliers and retailers, effectively maintaining
the cooperative relationship between partners and
improving the stability of the operation of the agricultural
products supply chain. Second, In the cooperation of fresh
agricultural products supply chain, the relationship
stability platform has established a dynamic and
reasonable incentive mechanism, such as risk insurance
subsidy, cooperative fund and other cooperative incentive
mechanisms, and carried out reasonable subsidy incentive
according to the cost change and risk of fresh agricultural
products, which can effectively reduce the default rate
between upstream and downstream enterprises in the
supply chain and ensure the production ， supply of
agricultural products and the stable operation of fresh
agricultural products supply chain.
To sum up, considering the main factors such as
information sharing, relationship trust and incentive
mechanism, the relationship stability platform connects
the scattered node enterprises in the fresh agricultural
supply chain, gives full play to the overall advantages
by virtue of the synergistic effect，and enables the node
enterprises in the supply chain to continuously exchange
information flow, logistics, capital flow and other aspects,
This exchange makes the fresh agricultural products
supply chain system in a flat and dynamic balanced
network supply chain, so as to realize the stable
development and long-term cooperation of the supply
chain relationship, and ensure the optimal result of the
overall performance of the fresh agricultural products
supply chain.
 V. IMPLEMENTATION GUARANTEE OF
RELATIONSHIP-STABLE FRESH AGRICULTURAL PRODUCTS
SUPPLY CHAIN MODEL
A. Improve the supply chain management mechanism of
fresh agricultural products, regulate the price of
fresh agricultural products
The management work is carried out on the basis of
unifying the overall specifications of the fresh agricultural
product supply chain, and according to market
fluctuations and consumer demand, it provides
differentiated services to the market. That is, regional
pricing and management, flexible changes in fresh
agricultural product supply prices for different customer
groups in different regions. Therefore, the Chinese
government needs to introduce the "protection price"
system of fresh agricultural products to stimulate the
production of fresh agricultural products and safeguard
legitimate rights and interests, which is conducive to
maintaining the stability of the supply chain of fresh
agricultural products.
B. Standardize the packaging and transportation of
fresh agricultural products, and unify the standards
of fresh agricultural products
Increase investment in fresh agricultural supply chain
cold storage preservation technology management, to
ensure the supply quality of fresh agricultural
products. With advanced technology and management
personnel to strengthen cold chain investment, can
introduce cold chain technology to the whole of fresh
agricultural products supply chain management, the need
to increase costs, and only by enterprise itself is difficult
to achieve. Therefore, the Chinese government should
formulate corresponding policies to benefit farmers and
provide policy support for the cold chain technology of
fresh agricultural products. At the same time, the supply
chain of fresh agricultural products should be managed in
a unified manner under the supervision of the Chinese
government, and the packaging and transportation of fresh
agricultural products should be standardized.The
freshness of fresh agricultural products is improved, the
stability of supply chain operation is greatly strengthened,
and the overall performance of the supply chain of fresh
agricultural products is also guaranteed.
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