Factors related to innovative output in the Dutch agrifood industry

Abstract

The present study assessed the factors related to innovative output in the Dutch agrifood industry, a scale-intensive, supplierdominated industry. We concentrated on explanatory variables related to cooperation, information sources, innovation objectives, obstacles to innovation, and innovation resources. Firm-level data were used from the Dutch section of the 2001 Community Innovation Survey (CIS, N=328). We conducted linear and binary logistic regression to analyse the data. The results show that in order to be successful in product innovation, firms must have a strong market orientation. Furthermore, we found that in order to become (more) innovative, firms must have organisational conditions in place, as organisational obstacles are associated with lower levels of innovative output. Innovation subsidies turn out to have a positive effect on both product and process innovations. With respect to the value of a focal firm's network, the surprising conclusion can be drawn that the network is not perceived as crucial for innovation: cooperation is not a factor that explains innovative output; and network actors are - only to a limited extent - perceived as important sources of information for innovation. Competitors as an important source of information explain the share of the total turnover from new or improved products, whereas suppliers are an important information source for process innovators. In summary, innovative agrifood firms do not rely strongly on external sources, contrary to expectations for supplier-dominated firms. Instead, Dutch innovative agrifood firms more strongly reflect the characteristics of scale-intensive firms.