Competitive Advantage Factors in Vertically Diversified Brand Chicken Business: A Partial Value Chain Analysis of a Japanese Poultry Wholesaler

Abstract

We aimed to clarify the competitive advantage of a vertically diversified brand chicken business as a method of creating a sustainable poultry business, using a part of Porter’s value chain framework to extract strengths and linkages of a company’s marketing in a case study of one enterprise adopting this business model. Company T1 achieved vertical diversification of its production, processing, distribution, sales, and restaurant businesses through its original brand chicken, produced on a direct-management farm and cooperative farms under uniform quality control. T1 internalized its poultry farming and never abandoned this model, despite its low profitability, because its original brand H chicken was a high-quality product at the core of T1’s marketing strategy. We concluded that this high-quality original product resulted in a successful vertically diversified business within the poultry industry. To achieve this success, efforts are needed to maintain high levels of quality using sophisticated human resource approaches.