The internationalisation of agricultural co-operatives - A source of conflict?

Conflict can occur as agricultural cooperatives internationalise, both in terms of their relationship with their supplier members and their requirement for capital. These and other critical factors are identified in the literature. Case study research was carried out on two new Zealand cooperatives – Fonterra, a pure cooperative in the dairy industry and Zespri, a cooperative hybrid in the kiwifruit industry and a cross-case analysis was performed. As a result of this research a new model was developed to describe six main Foreign Market Service Modes: exports, FDI, external sourcing, knowledge agreements, strategic alliances and formation of transnational co-operatives. The cross-case analysis identified various areas of similarity and difference between the two cooperatives. The internationalisation process of each was compared as were the risks and potential conflict that their respective strategies created. Finally the critical factors that internationalisation creates were highlighted and discussed with specific reference to how successful cooperatives internationalise without generating conflicts with their members or distancing themselves from them.