Local food entrepreneurs in Norway : case studies on successful practices for network learning and market development

Summary

Local food has been compared to a "quiet culinary revolution" in Norway, one initiated by a governmental strategy more than 20 years ago. The aim was to provide more local specialtiesꟷ"food and drink products with a defined origin and local identity or with distinct qualities based on recipes, processes or tradition" (Norwegian Food Foundation, 2019)ꟷin the Norwegian market. Since then, local food and drinks have attracted a substantial number of farm-based food entrepreneurs, contributing to value creation and market sales of 11.5 billion NOK in 2022 (Norwegian Food Foundation, 2022). The food sector in Norway is a highly competitive market due to high tolls and taxes, efficiency-focused prominent industry actors, and only three dominating grocery chains controlling the national market (Organisation for Economic Co-operation and Development [OECD], 2020). Local food, therefore, provides an intriguing option for customers who value variety. The interest from customers, producers, and policymakers is therefore growing in both direct-to-consumer markets and the grocery market (Low et al., 2015). In these past 20 years of local food, many new direct-to-consumer markets have been introduced, like the farmers' markets, farm shops, Internet sales, REKO rings (REKO is short for the Swedish “Reja l Konsumtion”, a direct-sales channel based on social media), and gourmet food stores, where local food entrepreneurs can utilize direct customer contact to build unique relationships (Milford et al., 2021). Many researchers have targeted the progress of local food in the Norwegian market as an interesting phenomenon, studying customer preferences and adoption, supply chain parameters, and governmental policy or sales channels (e.g., Bentsen & Pedersen, 2020; Dreyer et al., 2016; Halkier et al., 2017; Milford et al., 2021; Skallerud & Wien, 2019). However, little is known about the activities or practices used by local food entrepreneurs to build their businesses, develop innovative food specialties, and enter the market. The thesis contributes to the field of rural entrepreneurship through a practice-based perspective. Its main contribution is its development and expansion of theoretical frameworks on farm-based entrepreneurship. The thesis draws upon several theoretical lenses to study and identify successful practices for entrepreneurial activity in local food farm-based businesses. More specifically, the thesis aims to improve researchers’ understanding of how local food entrepreneurs utilize their place specific farm-based resources, become food producers, and learn to build a market for their unique products. Three branches of entrepreneurship literature will be explored to enhance our understanding of this topic: social entrepreneurial learning, entrepreneurial marketing, and entrepreneurial orientation/market-driving. Three research papers appended to the thesis address this further, using local food and farm-based businesses in Norway as the research context for discussion of a range of theoretical and applied topics in entrepreneurship literature. The first paper contributes to the social entrepreneurial learning literature by advancing a community learning perspective for farm-based entrepreneurs who build businesses based on their local farm resources. It identifies social learning mechanisms and learning outcomes for the individual entrepreneur. The second paper contributes to entrepreneurial marketing literature by identifying market development practices used by entrepreneurs in a farm-based micro-business context. The third paper contributes to the market-driving literature by identifying pioneering practices leading to market expansion. Further, this thesis demonstrates that policy, society, and academic institutions can support entrepreneurial activity and improve practitioners’ learning within an industry. The three papers are: Paper 1, Informal social learning dynamics and entrepreneurial knowledge acquisition in a micro food learning network, focuses on the social perspectives on entrepreneurial learning by considering the informal learning dynamics and outcomes in a facilitated learning network targeting farm-based businesses within the local food industry. This research builds new theoretical and empirical knowledge on the contributions of a facilitated learning network as a community of inquiry to support entrepreneurial knowledge acquisition. A single embedded case study was chosen as the research design, focusing on the Competence Network for Local Food Production (the facilitated learning network) with 12 farm-based food entrepreneurs within meat production as the embedded units. The units represented different experiences and frequencies of interaction with the facilitated learning network. The founder-managers from the embedded units were interviewed, reflecting on their learning from others. Findings show that informal regulating mechanisms for knowledge sharing influence social entrepreneurial learning. Enabling a community of inquiry to develop within the learning network increased the knowledge acquisition, and potential learning outcomes, for the individual entrepreneur. A conceptual framework was developed to show informal knowledge-sharing mechanisms and the local food entrepreneurs' entrepreneurial knowledge acquisition in a community of inquiry. Paper 2, The farm-based entrepreneur's marketing mix: a case study from the local food sector, explores the market creation practices of farm-based entrepreneurs in the local food sector. A multiple case study with 11 successful farm based entrepreneurs from 10 micro-businesses in Norway was chosen to conduct in depth retrospective interviews with the founder-managers. We found that the farm based entrepreneurs used slightly different entrepreneurial marketing practices depending on their purpose to transfer or transform their farms. A framework: the farm-based entrepreneur’s marketing mix (FEMM) was developed. The practices described using FEMM (person, purpose, practices, and process) can be used to illustrate how local food entrepreneurs create and expand the markets for their unique products. Paper 3, Micro-businesses in the driver’s seat: a qualitative study of market driving practices in the food sector, marks the fact that food micro-businesses (farm-based food entrepreneurs), despite their resource constraints, manage to drive markets using market-driving practices. They build new product categories in the competitive grocery market and thus contribute to market expansion with their innovative local food products. In a multiple case study, four pioneering food micro businesses within the Norwegian local food sector were analyzed, building on in depth interviews with the individual founder-managers. We found that food micro businesses can disrupt the grocery market using pioneering market-driving practices by taking significant personal risks and following their passion, being innovative, and creating passionate unique value propositions. Local food entrepreneurs proactively and perseveringly build new categories in the grocery market, not necessarily outcompeting the larger industry but instead expanding the market by providing customers with unique local food products. The study offers a novel attempt to explore and conceptualize market-driving practices in a micro-business context. A framework for market-driving practices in the local food sector was developed. Based on the identified practices in the three papers, an interesting dynamic interrelationship between social entrepreneurial learning, entrepreneurial marketing, and entrepreneurial orientation/market-driving literature was observed. All seemed to contribute in various ways to the successful community learning and market practices of the local food entrepreneurs. This underlines the fact that there is no “one size fits all” recipe for local food entrepreneurs’ market success but that the entrepreneurs must learn, work and collaborate along several dimensions and apply a variety of practices in order to succeed.

Read publication here:

NVA : hdl.handle.net/11250/3095518