The Sustainability of Contract Farming with Specialized Suppliers to Modern Retailers: Insights from Vegetable Marketing in Indonesia

Specialized suppliers to supermarkets in rural Java showed that smallholder farmers could engage contract farming with the rise of retail modernization. This paper examines whether they have sustained recent decline modernized stores. Our field survey, based on cases reported by World Bank 2006, provides following findings: (1) Some failed sustain due growers’ hold-up problems; (2) The prevent breaching either undertaking contract-specific investments train growers or provide inputs. Moreover, selected their social reputation avoid breaching; (3) We found breach modern channel begin arrange farmers’ groups themselves and return traditional as a new type intermediaries. indicates an evolution marketing supermarket revolution.