Effects of category management on producer-retailer relationships

The relationships between retailers and producers are considered for understanding the determinants of quality, variety and prices. In the food sector, some issues have been extensively studied: impacts of private labels, supply contracts, price transmission. Despite an increasing role, the implementation of “Category management” (CM) has been less studied. CM belongs to a set of methods based on the concepts of Efficient Consumer Response and Supply Chain Management which have been widely implemented by large retailers and thus have changed the relationships among actors in the food chain. As a part of this evolution, Category Captain’s concept (CC) involves a commitment between a retailer and one of the suppliers who receives decision-making power over the product category. Usually, the major of the food suppliers plays the CC’s role in partnership with the retailers. In practices, CC raises many questions. What effects on the sales and prices? Is it beneficial for all the stakeholders, including the consumers? What are their consequences on the non captain suppliers? We propose a vertical relationship model considering that the retailer is the chain’s leader (Stackelberg game). We compare a non-cooperative game (no CC) to a cooperative game (one supplier as CC). We analyse under which conditions CC improves the profit of each stakeholder, as well as the consumers’ surplus. We show that the cooperative game is always a “win, win, win” game for stakeholders (but not necessary for consumers) if the two suppliers offer similar products. If products are different, we define the parameters relationships under which CC is beneficial for stakeholders and consumers.Category captain, shelf space allocation, game theory, Stackelberg equilibrium., Agricultural and Food Policy, Food Consumption/Nutrition/Food Safety,

ARE FRUIT AND VEGETABLE STAMP POLICIES COST-EFFECTIVE?

In many countries, consumption of fruits and vegetables (F&V) is below recommended levels. We quantify the economic and health effects of F&V stamp policy designed for low income consumers. The analysis combined two models: an economic model which predicts how F&V consumption is affected by a change in policy and a health model which evaluates the impact of a change in F&V consumption in terms of death avoided (DA) and life-years saved (LYS). Finally we computed the costs per DA and LYS as the ratio between the taxpayer cost of the policy and the number of DA and LYS. The main findings of the present study are: (1) F&V stamp policy has a positive and significant impact on the consumption of small F&V consumers of the targeted population, (2) at the aggregate level, this policy has a modest impact on consumption and as a result on health gains, (3) for a given budget allocated to the policy, the cost per DA or LYS decreases when the targeting is smaller, at least as long as consumption remains in plausible values, (4) the policy reduces the health inequalities between low and high income populations, (5) when well designed, F&V stamp policy is as cost-effective as price policy (about 42 k€/LYS).Cost-effectiveness analysis, Fruits and Vegetables, Health Impact Assessment, Health Policy, Agricultural and Food Policy, Consumer/Household Economics, Demand and Price Analysis, Food Consumption/Nutrition/Food Safety, Food Security and Poverty, Health Economics and Policy, D61, I18, Q18,

Quality standards versus nutritional taxes: Health and welfare impacts with strategic firms

The goal of this paper is to better understand firms' strategic reactions to nutritional policies targeting food quality improvements and to derive optimal policies. We propose a model of product differentiation, taking into account the taste and health characteristics of products. We study how two firms react to alternative policies: an MQS policy, linear taxation of the two goods on the market, and taxation of the lowquality good. The MQS and the taxation of the low-quality product are the preferred options by a social planner. If taste is moderately important, the MQS policy is chosen by a populist and a paternalist social planner. If taste is a major component of choice, the populist planner chooses to tax the low-quality product whereas the paternalist planner prefers the MQS policy. Finally, for a paternalist social planner, an MQS-based policy always allows for higher levels of welfare than an information policy alone

Economic assessment of nutritional recommendations

The effect of consumers’ compliance with nutritional recommendations is uncertain because of potentially complex substitutions. To lift this uncertainty, we adapt a model of consumer behaviour under rationing to the case of linear nutritional constraints. Dietary adjustments are thus derived from information on consumer preferences, consumption levels, and nutritional contents of foods. A calibration exercise simula tes, for different incomegroups, how the French diet would respond to various nutrition recommendations, and those behavioural adjustments are translated into health outcomes through the DIETRON epidemiological model. This allows for the ex-ante comparison of the efficiency, equity and health effects of ten nutritional recommendations. Although most recommendations impose significant taste costs on consumers,they are highly cost-effective, with the recommen dations targeting salt, saturated fat, and fruits and vegetables (F&V) ranking highest in terms of efficiency. A five percent change in consumption of any of those nutrients or food would reduce premature mortality in excess of 2100 lives annually. By contrast, urging consumers to modify their consumption of fibers, sugar-fat products and dietary cholesterol is unlikely to be socially desirable, often due to large unintended adjustments in some dimensions of dietary quality. Most recommendations are economically progressive, with the exception of that targeting F&

Welfare and sustainability effects of dietary recommendations

The paper develops a framework combining a model of rational behaviour under dietary constraints, an epidemiological model of diet-related mortality, and a life-cycle-analysis model of environmental impact, which permits the ex-ante assessment of dietary recommendations in multiple sustainability dimensions (i.e., taste cost, welfare effect, deaths avoided, reductions in greenhouse gas emissions and acidification). It is applied to compare in a French context the relative effects and efficiency of six popular sustainable diet recommendations. The results confirm the synergies between the health and environmental dimensions: healthy-eating recommendations usually have a positive effect on the environment, although some exceptions exist. Most of the sustainable diet recommendations appear highly cost-effective, but those most commonly promoted on health grounds (e.g., targeting consumption of salt, fruits and vegetables and saturated fat) rank highest in terms of overall efficiency. Moreover, the valuation of benefits indicates that in most cases health benefits are significantly larger than environmental benefits. Overall, the analysis reveals some under-investment in the promotion of sustainable diet recommendations in France. The general lack of enthusiasm in policy circles for informational measures promoting behavioural change may reflect unrealistic expectations about the speed and magnitude of dietary change rather than an objective assessment of the efficiency of those measures

An assessment of the potential health impacts of food reformulation

Background/Objectives: Policies focused on food quality are intended to facilitate healthy choices by consumers, even those who are not fully informed about the links between food consumption and health. The goal of this paper is to evaluate the potential impact of such a food reformulation scenario on health outcomes. Subjects/Methods: We first created reformulation scenarios adapted to the French characteristics of foods. After computing the changes in the nutrient intakes of representative consumers, we determined the health effects of these changes. To do so, we used the DIETRON health assessment model, which calculates the number of deaths avoided by changes in food and nutrient intakes. Results: Depending on the reformulation scenario, the total impact of reformulation varies between 2408 and 3597 avoided deaths per year, which amounts to a 3.7–5.5% reduction in mortality linked to diseases considered in the DIETRON model. The impacts are much higher for men than for women and much higher for low-income categories than for high-income categories. These differences result from the differences in consumption patterns and initial disease prevalence among the various income categories. Conclusions: Even without any changes in consumers’ behaviors, realistic food reformulation may have significant health outcomes

Welfare and sustainability effects of dietary recommendations

The paper develops a framework combining a model of rational behaviour under dietary constraints, an epidemiological model of diet-related mortality, and a life-cycle-analysis model of environmental impact, which permits the ex-ante assessment of dietary recommendations in multiple sustainability dimensions (i.e., taste cost, welfare effect, deaths avoided, reductions in greenhouse gas emissions and acidification). It is applied to compare in a French context the relative effects and efficiency of six popular sustainable diet recommendations. The results confirm the synergies between the health and environmental dimensions: healthy-eating recommendations usually have a positive effect on the environment, although some exceptions exist. Most of the sustainable diet recommendations appear highly cost-effective, but those most commonly promoted on health grounds (e.g., targeting consumption of salt, fruits and vegetables and saturated fat) rank highest in terms of overall efficiency. Moreover, the valuation of benefits indicates that in most cases health benefits are significantly larger than environmental benefits. Overall, the analysis reveals some under-investment in the promotion of sustainable diet recommendations in France. The general lack of enthusiasm in policy circles for informational measures promoting behavioural change may reflect unrealistic expectations about the speed and magnitude of dietary change rather than an objective assessment of the efficiency of those measures

Welfare and sustainability effects of dietary recommendations

The paper develops a framework combining a model of rational behaviour under dietary constraints, an epidemiological model of diet-related mortality, and a life-cycle-analysis model of environmental impact, which permits the ex-ante assessment of dietary recommendations in multiple sustainability dimensions (i.e., taste cost, welfare effect, deaths avoided, reductions in greenhouse gas emissions and acidification). It is applied to compare in a French context the relative effects and efficiency of six popular sustainable diet recommendations. The results confirm the synergies between the health and environmental dimensions: healthy-eating recommendations usually have a positive effect on the environment, although some exceptions exist. Most of the sustainable diet recommendations appear highly cost-effective, but those most commonly promoted on health grounds (e.g., targeting consumption of salt, fruits and vegetables and saturated fat) rank highest in terms of overall efficiency. Moreover, the valuation of benefits indicates that in most cases health benefits are significantly larger than environmental benefits. Overall, the analysis reveals some under-investment in the promotion of sustainable diet recommendations in France. The general lack of enthusiasm in policy circles for informational measures promoting behavioural change may reflect unrealistic expectations about the speed and magnitude of dietary change rather than an objective assessment of the efficiency of those measures