Labelling and sustainability in food supply networks : a comparison between the German and Italian markets

The purpose of this paper is to focus on two aspects. First, to analyse the spread of labelled environmental certification in food products, considering both private labels and producer brands with reference to the Italian and German markets. Second, to outline how environmental certification can affect the vertical organisation of food supply chains. Design/methodology/approach - The method used is based on an empirical analysis carried out in two sample cities: Milan for Italy and Bonn for Germany, examining ten and seven retailers, respectively, using the case studies approach, through an ad hoc questionnaire. The authors analysed two cases related to fruit and vegetables and ichthyic products, in order to assess the effect of the standards provided by the sustainability certification on the vertical organisation of the supply chains. Findings - The certifications focus on three main areas: ichthyic products; tropical products; and fruits and vegetables. They are much more widespread on private label items, rather than on the industrial brands. The German market is more "sensitive" to sustainability issues than the Italian market. Environmental certification leads to a reorganisation of the supply chain relationships, determining a higher bilateral dependency among the supply chain agents, a reduction in product uncertainty, and an increased degree of vertical coordination. Originality/value - The paper analyses, through a new perspective, the environmental issues of food products, quantifying the spread of labelled environmental certification and comparing Italy and Germany. The vertical reorganisation of the supply chains involved the adoption of production rules, connected to environmentally-friendly practices, and the introduction of a new form of transaction governance