Producer cooperatives influence on competitive dynamics - the Azorean case

The aim of this paper is twofold: first, it aims at investigating how cooperatives organizational dimensions affect its strategic positioning; and second, how producer cooperatives influence the competitive dynamics of the markets where they compete. In order to answer these questions, I will focus on the Sao Miguel’s dairy market (Portuguese island) where producer cooperatives and private firms compete side-by-side. This paper follows a single case study qualitative analysis. The main data sources are the local newspapers articles (322 articles that covers 2010- 2012), and interviews with the market players (31 interviews). The results reveal that producer cooperatives tend to adopt cost leadership strategies, which naturally aligns with their historical roots and organisational purposes. Additionally, the paper stands that producer cooperatives are able to drive factor market competition activity in markets where there are severe asymmetries of power.