Tuesday, March 28, 2006

Let’s Go Glocal!

by Berly

I agree that the term “globalization” is probably the most overused, misused and abused term in the last ten years (“millennium” surpassed it briefly in 1999 though).

A derivative term is made by combining the centralizing force globalization with centripetal force of localization, resulting in a somewhat awkward “glocalization”. Wikipedia defines the term as “The creation of products or services intended for the global market, but customized to suit the local culture.” It also explained that the terms come from Japanese business practices and brought to English speaking world by a British sociologist named Roland Robertson in the 1990s.

A quick online search by Google revealed that the term has over 117000 hits. There is even a Conference on Glocalization that will conduct the fourth annual meeting this year. So, I guess we must accept that the term is here to stay.

The reason I go an extra mile to explain the origin of the term is simply that I want to describe glocalization at work in medieval city that I am living now.

If you pass Siena’s main street to Il Campo, you would not miss a neat and spacious modern supermarket like store own by Consorzio Agrario Siena (Agricultural Consortium of Siena), the windows has writing in English "Specialist Grocery Store - Typical Foods and Wines".

The majority of the products come directly from the local farm and most of the packed goods were packed up locally. You can find local fresh meat and wines together with more gastronomically palatable delicacies. Marmellata di mandarino (orange jam) taste great on any bread while funghi porcini (mushroom sauce) is suitable to almost any dish. Or you have a royal taste bud, then salsa tartulafa (black truffle) and ragu di capriolo (tomato sauce with and deer mince meet) is yours to taste.

Consorzio Agrario Siena is a farmer co-op that founded in 1901. Since then it has grown to provide various services from wheat grinding to specialty store, from agricultural technology consulting to gas station. It even has its own protein certification labs.

I have yet to study its history, membership and profit sharing method with it is very close to an ideal in term of production. It buys directly from farmer and sells directly to costumer. By cutting cost of unproductive middle man it can (and should) give more profit share to the farmers. Furthermore, the by obtaining the form of modern organization it can extend the reach beyond its borders. I am sure they also serve numerous specialty shops around Europe.

What does it take to bring it to other (especially developing) countries?

1. Heterogeneous products

The scheme would not work as well if they only sell olive oil and bread. The types of products need to be sufficiently numerous (beside few local specialty) to be able to command attention of customers.

2. Costumer taste

Designated customers need to develop a taste for “genuine” and “biologically friendly” products. After all, in term of production scale it is hard to compete with giants such as Nestle and Parmalat. Most likely that the price in CAS store’s can not be set to be lower than those giants. Customers need to have enough reasons for such a premium.

3. Modern organization

Having a vertical food processing company required modern management technique with high regard for efficiency. Family relationship should not be the main factor of employments. The need to obtain capital through banks or capital market also demands a professional and open organization.

4. Export oriented

The big money is out there in other countries. So are the customers with consciousness and willingness to pay. If local producer can tap those markets, it will greatly increased the sustainability of the co-op. After all, it is a natural next move for a glocalization phenomenon. The entire barrier to export and possible assistance to find global market from government is appreciated.

World need more glocalization! And while we are at a far flung part of the world looking for market access for a local producer, let also search for a better term for it.

1 comment:

pelantjong maja said...

consumer sovereignity and market driven policies are sometimes produce unintended consequences:
1) for developing countries, instead of buying biological friendly product, some (may be mostly) consumer even cant afford nestle or parmalat products. in addition, those food multinational companies are so efficient therefore they are able to provide cheap products. in the long run country' ability to provide food is diminishing partly because inability to compete with the price (some problem might happened such as market failure, government failure, institutional failure.
2) the big market out there is an illusion. the fact that unfair trade took place in developed countries as they protect their local producers by giving subsidies etc is obvious. the result is products from developing countries are less competitive in such market
3) large capital. those who has large capital (imagine how big is nestle, permalat etc) can achieve efficiency such as transport cost, manufacturing cost etc. it means that the succeess would be (one of them) determined by access to capital, which is difficult in developing countries.
4)i want to close the comment by saying we cant solely adopt what we have seen here (developed countries) as they have evolved over centuries. even we cant enhance our development overnight. still we need trade but not free trade, we need fair trade. we want development but not development for the rich.