The obstacles to cold chain implementation in developing countries: insights from Vietnam

• DOI: https://doi.org/10.1108/IJLM-02-2017-0026
• Pages: 942-958
• Published date: 14 June 2018
• Date: 14 June 2018
• Author: David Gligor,Albert Tan,Thi Nha Trang Nguyen
• Subject Matter: Logistics,Management science & operations

The obstacles to cold chain

implementation in developing

countries: insights from Vietnam

David Gligor

Department of Marketing, University of Mississippi, Oxford, Mississippi, USA

Albert Tan

Education Division, Malaysia Institute for Supply Chain Innovation,

Shah Alam, Malaysia, and

Thi Nha Trang Nguyen

Curtin University, Miri, Malaysia

Abstract

Purpose –The purpose of this paper is to identify the obstacles that impede cold chain implementation in

developing countries.

Design/methodology/approach –A groundedtheory methodology was employedto execute this research.

Eight semi-structured, in-depth interviews were conducted with senior managers in Vietnam. In addition,

consistent withgrounded theory guidelines,the authors utilized archivaldata to facilitate theory development.

Findings –The results of the analysis revealed a total of ten key obstacles: deficient professional skills, lack

of quality and safety-control measures, high concentration of intermediaries, poor infrastructure, lack of

information systems, high cost of installation and operation, inadequate education and training at farmer

level, deficiency of standardization, lack of government support for local businesses and social norms.

Originality/value –Although many authors have recognized the enormity of food wastage and limited

employment of cold chain in developing countries compared to developed countries, few efforts have been

made to explore the reasons for the limited use of cold chains in developing countries. There are several

noteworthy theoretical and managerial contributions that emerged from addressing this gap.

Keywords Developing countries, Asia, Grounded theory, Cold chains, Cold supply chain management,

Cold supply chains

Paper type Research paper

1. Introduction

A cold chain is a temperature-controlled supply chain that encompasses an uninter rupted series

of storage and distribution activities that maintain a given temperature (Shibata, 2016). Cold

chains help keeps perishable food safe and fresh for consumption throughout the course of

postharvest until the food reaches the final consumers. Cold chain management includes all the

means (equipment and people) used to ensure a constant temperature throughoutthe food chain.

Cold technologies have been used and developed robustly in agricultural supply chains

for meat, dairy, fish and horticultural products in the USA and EU countries since the early

1950s (Kitinoja, 2013). Nevertheless, cold chains remain underdeveloped in most developing

countries. Instead of using technological advances, most developing countries continue to

increase production to offset the food loss as well as to meet increasing customer demands.

Although many authors have recognized the enormity of food wastage and limited

employment of cold chain in developing countries compared to developed countries

(Shabani et al., 2012; Kitinoja, 2013), few efforts have been made to explore the reasons for

The International Journal of

Logistics Management

Vol. 29 No. 3, 2018

pp. 942-958

© Emerald PublishingLimited

0957-4093

DOI 10.1108/IJLM-02-2017-0026

Received 24 February 2017

Revised 5 May 2017

28 June 2017

Accepted 13 August 2017

The current issue and full text archive of this journal is available on Emerald Insight at:

www.emeraldinsight.com/0957-4093.htm

This paper forms part of a special section “Next-generation cold supply chain management: research,

applications and challenges”.

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IJLM

29,3

the limited use of cold chains in developing countries. To address this research gap, we put

forth the following research question:

RQ1. What are the obstacles that impede cold chain implementation in developing

countries?

We employ a grounded theory methodology to answer the question of interest. In-depth

interviews with Vietnamese managers, and secondary data were used to shed light on the

research question of interest.

We make some noteworthy theoretical and managerial contributions. We expand the cold

chain literature by offering a comprehensive understanding of the challenges firms experience

when setting up or operating cold chains in underdeveloped countries. This is a key

contribution considering that mostglobal corporationsare setting up operations in developing

countriesto tap into new consumermarkets and reap the benefits of globalization.Further, we

offer specific recommendations on how firms can address each of the identified challenges.

The rest of the paper is organized as follows. First, we review the literature on cold

chains and explore some of the benefits of cold chains. Next, we describe the methodology

and the grounded theory process. Finally, we present a discussion of the results and make

suggestions for future research.

2. Literature review

2.1 Cold chain and cold chain management

Extant literature offers several conceptualizations of cold chains, from simple to complex ones.

Castiaux (2010) delineates cold chain succinctly as the supply and distribution chain for goods

that must be contained within a prescribed temperature range. The author recommends a

structured approach to cold chain management which encompasses packaging procedure,

shipping validation, transport and storage. To make “cold chain”clearer, Terreri (2009) separates

it into two parts, “cold”and “chain.”The term “cold”regards the need to guarantee a specific

temperature in deterring the proliferation of micro-organisms in food while retaining its originality

through many stages such as processing, transport and delivery, and exposure at retail stores.

“Chain”involves managing a sequence of linked segments of processing, storage, shipping and

delivery with consistent documentation, records and visibility throughout the process.

The cold chain of Mallik et al. (2011) is defined as “a continuous and cohesive process”of

preserving commodities and products to guarantee their availability, potency

( for drugs) and freshness ( for food). The authors indicate that “cold chain maintenance”

refers to all materials, equipment, procedures and labor utilized to sustain temperatures

between +2and+8°C while in transit throughout the distribution and storage process, from

the manufacture point up to the beneficiary. Emphasizing on the importance of continuity in

the cold chain, Kitinoja (2013) considers cold chain as the uninterrupted handling of the

perishable food products within a low temperature environment during the postharvest steps

of the value chain. An integrated cold chain embraces the management of the movement of the

product, from the field, ranch or body of water, through diverse nodes in the chain: harvest,

collection, packing, processing, storage, transport and marketing , until it reaches the end-users.

A cold chain break signifies a disruption in cold chain management, causing food safety issues.

Shabani et al. (2012) describe cold chain management as a branch of supply chain

management because the purpose of a cold chain is to protect perishable products like medicine,

blood, dairy, meat, vegetables, flowers and fruit products. Among components of the cold chain

management toolkit, assessment and audit are indispensable (Sterling, 2012). The assessment is

to gauge whether the cold chain design is effective at controlling product quality or not, while

the audit is essential to evaluate if the cold chain management processes operate as intended.

Following Sterling’s study, authors have suggested different tools and applications to improve

cold chain management. Some examples include the Cold Chain Predictor software run with a

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Obstacles to

cold chain

implementation