Entry into Organic Farming by Non-Agricultural Enterprises Leveraging Existing Resources

Abstract

This study examines the experiences of non-agricultural companies that have entered the organic farming industry. It assesses whether these companies were able to leverage the management resources of their core businesses to address the challenges associated with market entry, such as acquiring cultivation techniques and securing customers. The research subjects were selected based on their success in achieving sustainable business development, as evidenced by exceeding JPY 100 million in sales and profitability. The findings revealed that, in addition to utilizing the management resources of their core businesses (human, financial, and informational resources), these companies effectively leveraged collaborative relationships with local communities to overcome challenges encountered during their entry into organic farming, such as acquiring cultivation techniques and securing differentiated sales outlets. Furthermore, for entrant firms that successfully developed their businesses by utilizing diverse management resources from their parent organizations, establishing a regional cultivation and marketing system appeared to be a prerequisite for successfully integrating organic farming into their business operations.