Game of Chains: Unravelling Uncertainty and Trading Behaviour in Horticultural Supply Chains

Abstract

The Dutch horticultural supply chain is characterised by substantial uncertainty resulting from ongoing organisational changes, such as the transformation from an auction-cooperative system to a sales organisation-based structure. This uncertainty causes strategic behaviour among all supply-chain members (including producers), which often disadvantages primary producers. This study investigates how uncertainty shapes trading behaviour and decision-making using Transaction Cost Theory as a theoretical framework. Specifically, it examines the relationship between environmental and behavioural uncertainty, trading behaviour and strategic responses. Employing a multimethod approach involving interviews, simulation sessions and debriefings to collect data, this study integrates a qualitative and quantitative analysis. The findings reveal: (1) how uncertainty influences trader behaviour and strategic decision-making, and demonstrates the need for more effective coordination mechanisms and strategies to reduce opportunism and inefficiencies in horticultural trade, (2) the diversity of strategic responses to uncertainty and (3) the factors that influence uncertainty and their relationship. These factors, include the current supply-chain structure that upholds uncertainty and strategic behaviour such as the deliberate exploitation of the absence or lack of information (asymmetric information). By combining methodological triangulation with theoretical insight, this study provides a foundational understanding of strategic behaviour under uncertainty in agri-food supply chains.