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This study analyzes the long-term effect of merger and acquisition (M&A) activity on the profitability, efficiency and liquidity of the largest 500 farmer cooperatives in the United States.

Secondary data from the U.S. Department of Agriculture are complemented with primary data collected from print media publications about M&A activity by US farmer cooperatives. The analysis is based on group comparisons of means and distributions to study the effect of M&A activity on financial performance.

Farmer cooperatives with M&A activity generally have lower profitability, efficiency and liquidity than farmer cooperatives without M&A activity, both at the time of the merger or acquisition as well as afterward. Marketing cooperatives in particular perform worse following M&As. Also, the post-merger performance of farmer cooperatives with M&A activity is not affected by the profitability, efficiency or liquidity of the target.

Research on the post-merger performance of farmer cooperatives is both scarce and dated. This study analyzes the effect of M&A activity for a relatively large sample and a relatively long time period (2005–2020).

Food service establishments and online food delivery companies use a revenue share model based on a commission rate. Because of the asymmetry of bargaining power, many food service establishments are vulnerable to a high commission rate. What is missing in the ongoing discussion about the revenue share model is the perspective of food consumers, who are the third party in the multi-sided market.

Within a willingness-to-pay (WTP) framework, we study if food consumers have preferences for the commission rate charged by food delivery companies to food service establishments. With 456 random consumers in the United States, we conduct a controlled experiment in which information is used as treatment in two groups. In the first group, the provided information only relates to the revenue share model (i.e. economic). In the second group, participants also received information about price control initiatives (i.e. economic and political).

Based on WTP-space mixed logit model results, there is a significant effect of information on preferences for the commission rate. While participants in the control group exhibited no aversion to the commission rate, participants who received treatment had a significant and negative WTP. The magnitude of the effect is estimated at -$1.08 for participants in the first treatment and -$2.28 for participants in the second treatment.

To date there is no applied research on the preferences of consumers in the online food order and delivery industry with respect to upstream conditions (i.e. commission rates).

A financial perspective of farmer cooperative performance is assumed by conceptualizing the cooperative as an independent firm. The purpose of this paper is to explore variability in the financial performance of the largest 1,000 US farmer cooperatives with emphasis on efficiency, productivity, and leverage.

Cooperative performance is analyzed by means of the extended DuPont identity, an accounting tool which decomposes return on equity into five ratios of efficiency, productivity, and leverage. The extended DuPont identity is applied empirically with quantile regression, which allows estimation of the statistical interrelationship of the DuPont components across the full response distribution.

Per the results, variability in the financial performance of US farmer cooperatives is for the most part associated with the operating profit margin, which confirms prior findings of cost inefficiency in the empirical literature. Therefore, US farmer cooperatives may improve financial performance by emphasizing sales and operating costs. Specifically, recommendations include placing emphasis on bargaining power, product differentiation, and scale economies. Supply cooperatives may also consider issuing non-qualified equity and securing long-term debt access as additional possibilities to improve financial performance.

The empirical application of the extended DuPont identity with quantile regression facilitates a novel investigation of cooperative performance by placing emphasis on the efficiency, productivity, and leverage of cooperatives with various degrees of performance.

Many farm producer organizations pursue growth and complexity in response to price volatility, industry consolidation and other external developments. Consequently, as ownership is dispersed and control is delegated, members may face increasing agency cost. In spite of the potential to impact performance and even survival, empirical attention to agency problems in farm producer organizations is limited. The purpose of this paper is to address the gap in the literature with an empirical study.

With survey responses from 365 farm producer organizations in the USA, the author uses a two-limit tobit model to estimate the relationships of six ownership and governance characteristics (i.e. board size, management size, director independence, manager independence, CEO independence and non-member ownership) to agency cost, which is proxied by the operating expense ratio.

While controlling for heterogeneity in scale and technology, the author finds positive relationships of board size, management size and CEO independence to agency cost. The novel result illustrates there is a significant cost to the adoption of non-traditional ownership and governance characteristics by farm producer organizations.

The presence of agency cost serves as motivation to farm producer organizations to implement new or adapt old agency mechanisms. One recommendation is to reconsider the payment structure of non-member CEOs. There may not be enough incentive to inspire an upstream bias, which is perhaps possible by linking CEO performance to price, patronage and member-oriented performance measurements.

Agency cost is rarely studied in relation to farm producer organizations. Recent contributions in the empirical literature lacked an explicit connection of ownership and governance characteristics to agency cost.

The objective of the study is to explore explanations for the capital structure compositions of farmer cooperatives, which have a unique equity structure with allocated equity as well as unallocated equity.

Data came from a panel of US grain marketing and input supply cooperatives for the 2010–2020 period. The study is concerned with the proportions of debt, allocated equity and unallocated equity, which requires the application of a fractional multinomial panel model to ensure predictions fall within the observed data range (i.e. 0–1).

Larger cooperatives have relatively high debt proportions. Diversification of the product portfolio has a positive effect on the debt proportion. Profitability is associated with higher debt proportions in input supply cooperatives and higher allocated equity proportions in grain marketing cooperatives. Over time, the proportion of unallocated equity increased. Overall, some results differ across grain marketing and input supply cooperatives.

Increasing proportions of unallocated equity warrant a debate about the future value of ownership and governance by members of farmer cooperatives.

Previous empirical investigations of the capital structure compositions of cooperatives lacked a distinction between allocated and unallocated equity. Our results show that the proportions of the two equity accounts respond differently to given predictors. Furthermore, much of the prior empirical literature fails to separate cooperatives on the basis of economic activities (i.e. marketing, supply and mixed).

The objective is to determine if consumer preferences for grocery purchasing are impacted by the severity of the COVID-19 pandemic and whether these preferences differ by demographic and psychographic characteristics.

The authors conduct an online discrete choice experiment (DCE) with 900 U.S. consumers to assess grocery shopping preferences under various scenarios of the COVID-19 pandemic (i.e. decreasing, constant and increasing cases). The attribute of interest is the purchasing method (i.e. in-store purchase, in-store pickup, curbside pickup and home delivery) with minimum order requirements, time windows and fees as secondary attributes. Heterogeneity in individual-level willingness-to-pay (WTP) estimates for the main attribute is analyzed by means of mixed logit and quantile regression techniques.

The mixed logit model reveals heterogeneity in WTP estimates for grocery purchasing methods across participants. According to estimates from quantile regressions, the heterogeneity is partly explained by the severity of the COVID-19 pandemic. For example, the home delivery purchasing method is less preferred when the number of cases is decreasing. The results also show that consumer preferences for grocery shopping methods are affected more by psychographic characteristics than demographic characteristics. Consumers who comply with COVID-19 directives (e.g. wear face coverings) have stronger preferences for curbside pickup and home delivery, particularly at the tails of the WTP distributions.

Although there is much data on food consumer behavior during the COVID-19 pandemic at the aggregate level, there are few analyses of grocery shopping preferences at the individual level. The study represents a first attempt to relate individuals' demographic and psychographic characteristics to their grocery shopping preferences during the COVID-19 pandemic, thus yielding numerous recommendations in terms of consumer segmentation.