Vertical Links In The Dairy Industry As A Response To Dependence On The Raw Material

Abstract

The scarcity and insufficiency of national raw milk production is the hardest challenge that dairy industry faced. This industry become dependent from this resource for a long time. To face this, the government try to promote the national production by imposing the vertical integration as a solution. After having explained the contribution of the resource dependency theory in the explanation of vertical links in response to the risks engendered by a dependence on a raw material, our work aims to study these vertical links in the entire dairy industry in the Bejaia region, based on the results of a field survey of the local dairy industries. Studying vertical links can give us an overview of the degree of vertical integration in the dairy industry. The results of the Pearson correlation’s analysis revealed a strong interdependence between the variables, which demonstrates the strength of the vertical links that explain a significant degree of vertical integration for the entire dairy industry.