Differentiation and Diversification in the Rice Industry in Rio Grande do Sul

Abstract

This study presents a view of the production chain, under a diversification and differentiation standpoint in rice processing companies from the State of Rio Grande do Sul, Brazil. The objectives of this work are to identify diversified and differentiated products offered in the market by companies; discuss the companies’ perceptions related to this market; study the information used by these companies to make decisions, and; discuss the reasons that limit companies from engaging into diversified and differentiated production. The theoretical approach is based on differentiation and diversification for the industry. Ten among the twenty largest rice processing companies in Rio Grande do Sul were interviewed. The interviews were semi-structured and they were conducted in the period from August to December 2006. The proposed model analyzes the institutional and organizational environment, current line of products, market information, consumer’s needs, technological needs, engineering information, raw material suppliers, differentiation and diversification. The results present strategies applied by companies and alternatives found to conquer new markets and to maintain the existing ones. The study identified diverse and differentiated products which are offered by the companies to the market, and also diverse initiatives such as soy products, fruit juices, other grains and pasta and differentiated products such as colored rice, rice with high iron level, semi-ready rice, risottos and different packaging, for example.