Vertical Integration in the Taiwan Aquaculture Industry

The study aims to improve the distribution channels in the Taiwanaquaculture industry through a better vertical integration. This studyis derived from a need to improve the distribution performance ofagricultural-based industries in response to increasing food demandsin Asia and elsewhere. Based on a four-by-eight matrix derived fromboth a value chain and a service profit chain, thirty different strategiesare developed. This development is based on key success factors andstrategies for vertical integration interviewed and cited in the literatures.The findings are identified by applying the Gray Relational Analysis(GRA). For this study, the key success factors for aquaculture wholesalemarkets include the communication, integration and cohesion ofopinion within the wholesale market; government support; andmutualtrust between members of the vertical integration scheme. The suitablevertical integration strategies are an improved safety and hygiene inspectionof aquaculture products, accuracy of aquaculture product categorization,and precision in product weighing.