The process of product development in small agricultural firms : a multiple case study of Swedish lamb producers

University essay from SLU/Dept. of Economics

Abstract: This study provides a better understanding of small-scale farmers New Product Development (NPD) processes, what activities farmers undertake within and how they work with NPD processes. NPD plays a crucial role in creating and maintaining competitiveness in many industries and its importance has grown over the years due to changing market conditions, also in the agricultural sector. One of the most critical and most important tasks for a firm is the launch and development of new products, moreover, the high frequency of failure of the development of new food products, 72-88% fail at launch, shows that the knowledge of practices for developing new food products needs to be expanded. There is a great potential for the Swedish lamb production to conduct NPD processes, with an animal that produces three different base materials; wool, meat and sheepskin, and having an increased demand for newly developed products. Previous studies have focused on NPD in large firms and on mostly industrial products. The food product sector has been neglected, which has resulted in a paucity of studies on how small firms can incorporate and work with NPD practices. Moreover, previous research has tried to identify success factors and “the best practices”. In those studies, the firm context is treated as static and over-simplified, however, this study sheds light on the matter of NPD processes through a farmers’ perspective, fulfilling a gap of knowledge on NPD in the agricultural context. The findings from this study can provide empirical insights that might be valuable to fulfil government’s and policymakers’ wishes to increase the innovation rate in the agricultural sector of Sweden. A conceptual framework was developed based on the stage-gate model and a literature review of factors for success when firms engage in innovation projects. By using a qualitative approach based on semi-structured interviews, a multiple case study was conducted on eleven lamb producers on the island of Gotland in Sweden. A conclusion is that the interviewed farmers are most engaged in the activities; development, testing and validation, and consumer relationship when launching the product, and less engaged in scoping, building a business case and post launch review. Moreover, the farmers are more involved in processes within firm- and productrelated factors and are less involved in activities that relate to project- and market-related factors.

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