Wine industry Supply Chain (WSC) modeling: an Argentine-France - PowerPoint PPT Presentation

Third International Workshop on Food Supply Chain (WFSC 2014) Making Food Supply Chains Efficient, Responsive and Sustainable San Francisco, CA, November 4 - 7, 2014 Wine industry Supply Chain (WSC) modeling: an Argentine-France comparison Saglietto Laurence - University of Nice Sophia Antipolis – GREDEG CNRS - France Corresponding author: laurence.saglietto@gredeg.cnrs.fr Fulconis François - University of Avignon - CRET-LOG / Aix-Marseille University - France Bédé Didier - University of Toulouse III, Research Center LGCO - France De Almeida Goes Joice - University of Nice Sophia Antipolis – GREDEG CNRS - France Forradellas Raymundo - Universidad Nacional de Cuyo – CEAL - Argentina

It is a pleasure to share the activities of the WFSC Thanks Susan & Alejandro!

The Wine Regions selection  Sud-Est France (60.000 KM 2 )  Mendoza, Argentina (149.000 KM 2 ) Zone of Mendoza River ( ~ 5.000 km2) Languedoc-Roussillon • • North zone; Provence • • East zone Vallée du Rhône • • Valle de Uco •

Argentine and France Viticulture  General characteristics Number of wineries Argentine 1.280 Mendoza area 998 France 1.498 South-East area 73 Internationally active Argentine 1.047 France 355 Total Wine Production Argentine 11,02/millions hl France 42,24/millions hl Source: National Viticulture Institute – INV; 2012 http://www.inv.gov.ar and International Organisation of vine and wine – OIV; 2012 //www.oiv.int

Total General Information Argentine and France wine exports  Exported volume (Mhl) by destination country France Argentine JAPON HONG KONG, 292 DENMARK, 54 , 59 NETHERLANDS, 108 CANADA, 460 GERMANY, 53 JAPAN , 605 BRAZIL , 156 SWITZERLAND, 717 PARAGUAY GERMANY, 2591 , 163 USA, 1170 UK , 167 UK, 2100 RUSSIA , 233 CHINA , 1395 USA , 1726 CANADA BELGIUM, , 285 1505 NETHERLANDS, 1212 Source: National Viticulture Institute – INV; 2012 http://www.inv.gov.ar and International Organisation of vine and wine – OIV; 2012 //www.oiv.int

Actors Wine Supply Chain Raw material Grape Grower Wine producer supplier Cooperative Bulk wine Transit cellar winery distributor Filler/Packer Freight Freight Forwarder operator Importer Finished goods Wholesaler disbrutor Retailer End Customer

Modeling Supply Chain Approach: Modeling the WSC through the Social Network Analysis (SNA) • Analyses the interactions of nodes within a network. • Contributes to the understanding of SC complexity. Unit of analysis: • Contractual relationship • Each actor is considered a community Decomposition in 3 Levels of Analysis: • Triad (3 Node Network) • Group • Complete network

Level of Analysis First Level - Triad (3 Node Network) Example of role Trio node network for the central actor in the triad Intermediate Freight Operator / Importer / To turn them into its own advantage, End customer dealings between networks members Broker Freight Forwarder / Freight To facilitate or control the flow Operator / Importer Coordinator Filler-Packer / Finished Good To reconcile several options of network Distributor / Wholesaler members and align goals Wholesaler / Retailer / End Agent customer To distribue ressource Hub Transit / Filler-Packer / To facilitate or control the flows of Finished Good Distributor supply across the whole network

Level of Analysis Level of Analysis Second Level - Groups Second Level - The Groups 1. Production group 1. Production group Raw Materials supplier Transit cellar Grape Filler - Bulk wine distributor Grower Packer Wine Producer Cellar door sales

Level of Analysis 2. Distribution on national market Wholesaler Filler-Packer Retailler Finished good Dist. End Customer 3. Distribution on international market Freight operator Freight Forwarder Importer Filler-Packer End Customer

Level of Analysis Third Level - Complete Network Freight Forwarder Freight operator Importer Raw Materials supplier Wholesaler Grape Wine Prod. Grower Filler -Packer Retailler Finished good Dist. Bulk wine dist. Transit cellar End Customer Cellar door sales

Research methodology Case studies Argentina France Criteria for identifying Classification of Economic Activities companies Case studies 6 companies 6 companies Case studies 2 importers

Results and discussion  Theoretical Model: The complet network of WSC Freight Forwarder Freight operator Importer Raw Materials supplier Wholesaler Grape Wine Prod. Grower Filler -Packer Retailler Finished good Dist. Bulk wine dist. Transit cellar End Customer Cellar door sales

Results and discussion  MA model: Mendoza Argentina WSC network Freight Forwarder Freight operator Importer Raw Materials supplier End Wine Prod. Customer Retailler Wholesaler Finished good Dist.

Results and discussion  SEF model: South East of France WSC network Freight Forwarder Importer Raw Materials supplier Grape End Coop. Winery Grower Customer Wholesaler Retailler

Results and discussion 1st Comparison Theoretical Model: MA Model & SEF Model Theoretical model MA model SEF model • 3 actors: wine • 2 actors: prod., filler- • 1 actor: wine cooperative Main Actors packer and finish prod. winery and goods dist. grape grower Grape grower • Estate wineries: private domains and wine prod. Prod. Network • Less integrated • More integrated International • Equivalent to the Theoretical model distribution • Equivalent to • Differs the National the Theoretical Theoretical distribution model model

Results and discussion 2nd Comparison Production Network: MA Model & SEF Model MA model SEF model Hub • Wine producer • Grape grower and the Central cooperative winery Grapes from its own vineyards, • Grapes are transported to wineries • Grapes from its own vineyards. • using an internal or external Grape growers and cooperative • transport. winery can also export. Many steps fot prod. Wine. The • Sale grapes directly to end • number of steps depend on the type customer. of wine. Prod. The cooperative winery includes a • large group of grape grower. The cooperatives wineries have a • very important place in the WSC.

2nd Comparison Continuation: MA Model & SEF Model MA model SEF model • ISO 9001 - ISO 14001 - ISO 9001 - ISO 14001 - IFS BRC - Recognized HCCP - ASPBA VDD certifications • Reduction of water and fuel consumption, Sustainability • Systematic waste sorting and recycling, Environmental • Reduction in pollutant emissions, carbon footprint, aspects • Actions fostering biodiversity • Use photovoltaic panels • protocol has a strong and limits the carbon humanistic approach, Sustainability footprint, • social benefits Socio- economic • lighter bottle, collecting • child-care aspects and recycling cork, • nutrition for the • computerized vineyard families of seasonal RSE - SER and intranet use. workers .

Results and discussion 3rd Comparison National Market Network: MA Model & SEF Model MA model SEF model • Finish goods distributor • Cooperative winery • reception, storage, • relationship between Role of inventory and dispatch, as actors, coordinator well as re-packing and re- • activities to satisfy the end labeling as required. customer . Prod. • Strategies « bottle to order » and « label to order » Strategies • Large Distribution Net • Short Distribution Net • Rep. various Arg. wines, • online sale, direct sales in Dist. channel • Web advertising cellar, • On online social network. • Altitude is the "Argentine • Adequacy between grape Charact. terroir", temp variability . variety used on terroir.

Results and discussion Fourth Comparison: international Market Network MA Model & SEF Model MA model SEF model • Distributed to external • Distributed to external market market through importers through importers • 2 tiers system • 3 tiers system Dist. • Incoterm FOB • Incoterm FOB channel • freight operator can be • freight forwarder provides itself directly in relationship with the transportation service of the wine producers goods to destination countries . Broker • Freight operator • Freight forwarder role • Port of Valparaiso and Buenos • Port of Le Havre and Marseille Ports Aires • Wine quality to the end consumer in the destination country is Quality of primary importance.

Conclusion • Obtaining a new structure and vision of modeling of WSC through the approach of SNA. • Identification of relevant actors having an essential role in the WSC network. • The model can contribute to appreciate the key points for a b tt t l ( ll l i

Conclusion • Identification of inefficient and efficient processes in their contractual relationship. • Importance of sustainability: traceability, carbon footprint, use of ICT, LSP processes, reducing delays between order and shipment.

Suggestion of future works • Benchmarking through a comparative study of other regions • Performing a correlation study between the presented model and the process optimization; • Apply performance measures in this model; The use of this model as standard in other • industries of the sector of food and beverage