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Publication Details
AFRICAN RESEARCH NEXUS
SHINING A SPOTLIGHT ON AFRICAN RESEARCH
business, management and accounting
The boundaries of the firm: Why do sugar producers outsource sugarcane production?
Management Accounting Research, Volume 16, No. 1, Year 2005
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Description
Industrial firms world wide have shed non-core business and outsourced these activities. An increasing number of sugar producers in Southern Africa have also outsourced their sugarcane production activities for both strategic and equity reasons. The purpose of the study is to use a transaction cost analysis (TCA) approach to assist the firm, as an outsourcer, make and structure an outsourcing decision. A Case Study methodology, which includes data from two major Southern African sugar producers, is employed to test the research questions. The results indicate that sugarcane production should not be outsourced on a partial specification contract basis but rather co-ordinated by a more relational tructure like a strategic alliance. The results also suggest that the suitability of a strategy-based structure can sometimes be contradicted by a transaction cost analysis approach. Finally, the results indicate a conflicting South African agribusiness scenario, namely, the need to expand small-farm supply versus the economic goal of profit maximisation. © 2004 Elsevier Ltd. All rights reserved.
Authors & Co-Authors
Sartorius, Kurt
South Africa, Johannesburg
University of the Witwatersrand
Kirsten, Johann F.
South Africa, Pretoria
University of Pretoria
Statistics
Citations: 75
Authors: 2
Affiliations: 2
Identifiers
Doi:
10.1016/j.mar.2004.10.001
ISSN:
10445005
Study Design
Case Study
Study Approach
Qualitative