4.1.4. Niche

Niche FSCs differentiate their products via processes and methods that are highly specialized. Growing and production methods may (or may not) be externally certified or recognized by an institution or body of experts. The practice of organic growing methods, for example, may pre-date development of governmental organic standards. Niche

producers engage in some level of exploitation as well as exploration. While the balance of exploitation and exploration varies between cases, this organizational ambidexterity is necessary for Niche producers to exploit and incrementally improve existing production methods while exploring demand characteristics [57,58]. For example, depending on the exact type of forage available, pastured eggs may have a more favorable nutritional profile than eggs from Mainstream FSCs [59]. This nutritional advantage is less widely recognized than other attributes of pasturing, but represents a potential additional competitive advantage for firms than can maintain this convention.

Conventions of place or tradition may be codified by external bodies, or may be less formal (e.g., Washington State apples versus Denominazione di Origine Controllata e Garantita [DOCG] for Italian wine). Domestic conventions can be rooted in traditional methods and location (e.g., Spanish jamón Ibérico), however firms may seek to transfer the methods to different locations (e.g., ham produced in Texas using the same cerdo Ibérico species, and the same feeding, slaughter, and curing methods as in Spain). Attachment to place can be very specific to *terroir* in that the underlying characteristics of that location are considered non-substitutable (e.g., DOCG Italian wine). Alternatively, attachment to place can be associated with a claim of *local* production and distribution.

Specific elements of Niche methods may limit the ability to scale production, keeping prices relatively high. Pasturing of hens to produce pastured eggs, for example, is not formally defined by any regulatory agency, but Certified Humane (among others) sets a standard and conducts facility certification [60]. Because this standard requires at least 108 square feet of pasture availability versus the two square foot certification standard applied to free range eggs, pasture raised eggs under this standard require greater resource inputs and sell at higher prices.
