Are one or two levels in the supply chain that contain businesses on which another company’s operations or success are remarkably dependent (Kane, 2013). It may also become pertinent that a business whose own functions are beyond reproach could sometimes outsource to outfits that carry huge reputational risk (Soyka, 2012). In such instances, businesses have numerous options to take. These stretch from reorganizing the chain (e., terminating some suppliers) proactively and practically addressing the source of risk or working to ensure that any implications of failure are barricaded at another stage in the chain.Establishing provenance is a tasking endeavor that requires significant investment to achieve success. For supply chain partners, the technologies involved in the establishment of provenance are costly enough to warrant ignorance of the issue. For example, technological advancement has now made it possible to radio frequency identification (RFID) tags and other types of tags to provide customers with information on the origins of products (Blecker, 2014).. Although the investment is worth it, a majority of businesses cannot afford to buy these technologies. For supply chain partners that do not use technologies, the outlay involved in establishing provenance is still significant.Although some scholars have argued that establishing provenance can reduce, in the long term, the cost of goods, evidence suggests that in some cases consumers may have to pay more to understand the origins of their products. After investing in establishing provenance, supply chain partners and companies will simply pass the extra costs down to consumers by increasing the prices of their good accordingly (Kane, 2013). For instance, when a business spends a significant amount of money in fitting all their products with RFID tags, consumers will pay more for their favorite products to compensate for the extra costs incurred by supply chain partners and businesses (Goldin & Mariathasan, 2014). Away from individual consumers, consumer groups also incur huge costs when lobbying for businesses and supply chain partners to establish provenance. Lobbying is both engaging and costly since it has to be funded, and affected parties must actively contribute to its success.Governments spend millions of dollars every year in convincing consumers and supply chain partners to demand and establish provenance respectively. Governments also incur huge costs in formulating and
Blecker, T. (2014). Innovative methods in logistics and supply chain management: Current Issues and emerging practices. Munich: Epubli.
Goldin, I., & Mariathasan, M. (2014). The butterfly defect: How globalization creates systemic risks, and what to do about it. Princeton: Princeton University Press.
Kane, G. (2013). Building a sustainable supply chain. Oxford: Dō Sustainability.
Lindgreen, A., Vanhamme, J., Maon, F., & Sen, S. (Eds.). (2013). Sustainable Value Chain Management a Research Anthology. (Illustrated ed.). Farnham: Gower Publishing.
Soyka, P. (2012). Creating a sustainable organization: Approaches for enhancing corporate value through sustainability. Upper Saddle River, N.J.: FT Press.
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