Literature review

Many indicators were detected as incentives for enterprises to follow food safety and quality practices, comply with standards or even implement third-party audit-based certification schemes. Buzby and Frenzen (1999) summarized the factors that determine a firm’s level of food safety by the combination of product liability, governmental regulations, and market forces.

Hobbs et al. (2002) argued that the essential factors driving change in the approach to food safety in Canada have been external ones. Legal requirements were indicated early on to be external incentives to achieve food safety and quality standards in order to enhance national and international consumer confidence in the country’s food systems (Huff and Owen 1999; Woteki 2000). In addition to legal requirements, incentives to meet the requirements of consumers and customers can also drive adoption externally. Customers such as large retailers or food service operators can exert pressure to force food processors to implement enhanced safety and quality assurance systems (Golan et al. 2004; Lindgreen and Hingley 2003).

Some internal incentives, such as profit maximization and economies of size, can also in-fluence firms’ willingness to implement certification systems. Thomsen and McKenzie (2001) suggested that, if there is a demand on the part of consumers, profit maximization can partly en-courage firms to spend resources to provide a certain level of safety. An increase of firm profits can also be achieved through avoidance of costs related to food contamination occurrence and liability claims (Jayasinghe-Mudalige and Henson 2007); other benefits can stem from the en-hancement of internal efficiency, such as the improved design of business processes that can result from standard adoption (Holleran et al. 1999; Henson and Holt 2000; Fouayzi et al. 2006;

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Jayasinghe-Mudalige and Henson, 2007). Economies of size in food safety technologies will clearly act as an internal incentive for larger firms to adopt such systems, while they act as a dis-incentive for smaller firms (Herath et al. 2007). Handschuch et al. (2013) indicated that the anal-ysis of the certification decisions of Chilean raspberry producers showed that small-scale farmers are less likely to implement food safety standards. In contrast, Mensah and Julien (2011) con-cluded that there is no significant effect of enterprise size on compliance with food safety prac-tices in the British food and drinks manufacturing sector.

In addition to external and internal factors, other factors may also affect a firm’s willing-ness to adopt food quality and safety systems, for instance, reputation and reduction of transac-tion costs. The enhancement of reputatransac-tion, or brand name capital, was early detected as an im-portant incentive (Hayek 1948; Marshall 1949 as cited in Klein and Leffler 1981). Firms with branded products are more likely to explore ways of expanding their markets and protecting their brands. Thus, such firms will be more likely adopt enhanced food safety and quality assurance practices (Herath et al. 2007). Heyder et al. (2012) showed similar results for investments in tracking and tracing systems in the food industry. Transaction cost minimization among partners in the supply chain is also likely to influence adoption behavior. Lower costs are associated with the reduction of quality uncertainty among buyers, maintenance of separate quality control la-boratories and exchange processes, and number of audits (Caswell et al. 1998; Holleran et al.

1999; Luning et al. 2002; Schulze et al. 2006). Zhou and Jin (2009) summarized the factors that affect the implementation of food safety and quality standards by agricultural cooperatives in China by cooperative size, perception of standards, reputation, expected costs and benefits, and destination market.

The relative importance of the aforementioned incentives is definitely affected by firm characteristics and activities. For instance, industry subsector might explain differences in the importance of legal requirements and customer pressure as incentives to adopt enhanced food safety and quality assurance practices. Such incentives are likely to be greatest in the case of industry sub-sectors, where the probability and consequences of food safety failures are greatest, such as the meat and dairy processing sectors, while these risks are relatively smaller for the ce-real and bakery sectors (Hassan et al. 2006). Meeting legal requirements was the most important incentive among HACCP adopters in the U.K. dairy processing sector (Henson and Holt 2000).

Furthermore, product type affects the size of transaction costs. The costs of investigating, bar-gaining, and verifying food quality and safety attributes are likely to be greater for meat, fish and dairy products, which have been identified as high-risk commodities (Herath et al. 2007).

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Caswell et al. (1998), Holleran et al. (1999) and Henson and Holt (2000) indicated that not only a firm’s prices, costs and profits stimulate a firm’s standard adoption, but firm charac-teristics also have a specific impact on such an adoption decision. Similarly, Madlener and Wickart (2004) denoted that firm characteristics obviously determine the cross-sectional differ-ences among firms in their behavior regarding a new technology. On the other hand, Henson and Holt (2000) revealed that, due to the different firm characteristics and objectives, which vary with the type of product manufactured and the environment in which a given firm operates, it is not possible to generalize the impact of a particular set of incentives on the level and type of food safety controls that are adopted by a particular firm at a particular point in time. While Herath et al. (2007) appreciated the variation in the incentive sets of individual firms, it is proba-ble that a systematic relationship exists between firm characteristics and their propensity toward certification. MacDonald and Crutchfield (1996) indicated that the adoption of a food safety management system is significantly predicted by the levels and forms of innovatively processed products and the major markets served. Hobbs et al. (2002) confirmed that the principal factor that motivated Canadian meat enterprises to use food safety and quality standards was maintain-ing access to the United States and other foreign markets. A firm’s geographical location can also influence its concern. Chiciudean at al. (2014) indicated a strong discrepancy between com-panies from Northern and Southern regions in Romania regarding the number of traditional products certified. The Northern region will become a source of certified products. The first comprehensive study that empirically analyzed the association between firm characteristics and the adoption decision was Herath et al. (2007). They found, based on data from the Canadian food processing sector, that firm size, industry subsector, country of ownership and control, and level of innovativeness influence the adoption of enhanced food safety and quality assurance practices.

With regard to Turkey and most Central and Eastern European countries, where certifica-tion has become a strong trend (Gawron and Theuvsen 2009), the number of studies are quite limited and restricted to a specific sector and/or a specific food safety practice. For example, Mutlu et al. (2003), Baş et al. (2006 and 2007) and Sözen and Hecer (2013) determined certain indicators, difficulties and barriers related to HACCP implementation in the Turkish food busi-nesses. Çobanoğlu and Işın (2007) evaluated the adoption of food safety systems in 38 dried fig businesses. Factors affecting adoption of the organic dried fig in Turkey were investigated by Işın et al. (2007). Demirbas et al. (2008) analyzed the role and importance of milk collection centers in Izmir for assuring food safety in the Turkish dairy sector. Koç et al. (2010) presented

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and evaluated the institutional environment for food quality and safety in Turkey including the relation to EU legislation. In order to determine the impact of export orientation as a motivating force for the adoption of food safety systems, Çobanoğlu (2012) explored its impact on Turkish dried fig firms. Çobanoğlu et al. (2013) investigated the factors affecting the probability of im-plementation of food safety and quality assurance systems in the dairy and the meat sectors in Aydin, western Turkey.

This paper is, to our best knowledge, the first report related to a comprehensive determi-nation of the complete set of determinants of the implementation of food safety and quality sys-tem practices that take into account various Turkish agribusiness sectors rather than just one sec-tor. Furthermore, it considers a broad spectrum of public and private standards. Thus, the main objective of this study is to explore which determinants actually influence the level of implemen-tation of food safety and quality system practices in the Turkish agri-food sector.