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Being different matters! A closer look into product differentiation in specialty coffee family farms in Central America

Allan Discua Cruz (Centre for Family Business, Management School, Lancaster University, Lancaster, UK)
Leonardo Centeno Caffarena (Fundación Centro de Promoción y Desarrollo de la Empresa Familiar, Managua, Nicaragua)
Marcos Vega Solano (Universidad Técnica Particular de Loja, Loja, Ecuador)

Cross Cultural & Strategic Management

ISSN: 2059-5794

Article publication date: 28 February 2020

Issue publication date: 30 June 2020

Abstract

Purpose

There is a growing interest in understanding the strategic behaviour of family firms producing international commodities such as coffee, particularly in contexts where decisions about what products to sell, where to commercialise them and how to promote them appear to be highly based on both business and family aspects. The purpose of this paper is to explore product differentiation strategies in family firms in the specialty coffee industry across Latin American countries. Whilst the socioeconomic relevance of coffee production in Central America is unequivocal, the approach and rationale of families that engage in specialty coffee production remain underexplored.

Design/methodology/approach

This study examines product differentiation in specialty coffee family farms across countries in Central America: Guatemala, Honduras and Nicaragua. The study relies on in-depth interviews, case studies and an interpretative approach to unpick the dynamics of product differentiation by families in business dedicated to producing specialty coffee.

Findings

The findings show that product differentiation in specialty coffee family farms is influenced by both business and family aspects and driven by entrepreneurial stewards. Coffee-farming families can engage in product differentiation through a shared vision, a combination of traditional and specialised knowledge, and through the continuous development of an exchange network. The findings reveal a connection between families in business balancing family and business interests, and the strategic intention to build up their assets entrepreneurially over time.

Originality/value

This study contributes to the literature on stewardship and strategic behaviour in family firms when families in business engage in differentiating their products in a highly competitive industry. More specifically, this study focuses on companies across countries where coffee is of crucial socioeconomic importance, and where the said companies are owned and managed by families. The study expands understanding of product differentiation in family-enterprise-first businesses and suggests that the family elements in differentiation can be explained through an entrepreneurial stewardship perspective.

Keywords

Acknowledgements

Earlier versions of this paper have been presented at the Family Enterprise Research Conference (2019), the International Small Business and Enterprise Conference (2019), the European Academy of Management (2019), the McGill international entrepreneurship conference (2019) and the EIASM workshop on family firm management research (2019). Friendly and constructive feedback was received from participants. This article forms part of a special section “Family Business and Local Development in Iberoamerica”, guest edited by Luis Gomez-Mejia, Claudio G. Muller, Ana Cristina Gonzalez, Rodrigo Basco.

Citation

Discua Cruz, A., Centeno Caffarena, L. and Vega Solano, M. (2020), "Being different matters! A closer look into product differentiation in specialty coffee family farms in Central America", Cross Cultural & Strategic Management, Vol. 27 No. 2, pp. 165-188. https://doi.org/10.1108/CCSM-01-2019-0004

Publisher

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Emerald Publishing Limited

Copyright © 2020, Emerald Publishing Limited