Value ChainValue Chain
Dr. Nittana SouthisengSME Development Specialist
Mekong Institute
29 Octobter 12
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A mechanism that allows producers, processors, and traders—separated by time and space—to gradually add value to products and services as they pass from one link in the chain to the next until reaching the final consumer (domestic or global).
What is Value Chain (VC)?
Exists when the actors in the chain operate in a way that maximizes the generation of value along the chain.
Sour
ce:
UN
IDO
(20
10).
Val
ue C
hain
Dia
gnos
tics
for
Indu
stri
al
Dev
elop
men
t
SupportActivities
Primary Activities
Technological Development
Human Resource Management
Firm Infrastructure
Procurement
Inbo
und
Log
istic
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Ope
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Out
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Mar
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Elements of Value ChainElements of Value Chain
Value chain actors are the firms and individuals who assume different functions in the value chain, engaging directly in production, processing, trading and marketing.
Value Chain Actors
Value Chain Mapping
Products
Value chain
actors and their
functions
Flow of products and end markets
Business interactions
Service provision
Value Chain & Business Support Services
What are the potential business in your country?
Who are the actors that participate in businesses across value chains?
Map the flow and their business interactions
Value Chain Actors
Mapping Cashew Value Chain in Tanzania
A method for understanding how firms under given framework conditions operate and coordinate their businesses to ensure that primary materials are transformed, stored, transported and reach end-consumers in certain form and quality.
Value Chain Diagnostics
VCD aims at identifying how the productivity of chain activities can be improved, either through improved technologies, organizations, institutions to better coordinate the various stages of production and distribution, and meet consumer demand.
Value Chain Dimensions in Diagnostics
Sourcing and supplies
Production capacity and technology
End-markets and trade
Governance of value chains
Sustainable production and energy use
Value chain finance
Business environment and socio-political framework
Farmer/ Producers/ Cultivation
Trader/collector
Processing
- Manage
- Value adding
- Distribution
Retailer Wholesaler Exporter Consumer
- Manage
- Value adding
- Distribution
Wholesaler in export market
Distributor in export market
Retailer in export market
Value Added Value Added
A process takes inputs and
performs value-added activities
on those inputs to create an output.
The success of actors in value-
adding their production lies in the ability of these actors to be part of the networks
Value Added Process
Value Added ProcessA process map is a graphical representation of all of the steps involved in an entire process or particular segment of a process.
Determine the boundaries of the
process and
Involve representatives from each major activity
associated with the process in the
improvement effort.
Map the process by identifying non–value-
added activities & value-added activities.
Eliminate the non–value-added
activities.
Redesign the process using the knowledge
gained in the first nine steps.
Mapping Value Added Process
Market Trend
Creative
ConvenientHealthy
Less environmental
impact
Value Adding
Dried Som Tum “Thai Smile”
Banana
Fish
17Examples of Thai Agricultural Creative Products
Dried Som Tum “Thai Smile”– vacuumed and dried food – keeps the freshness of vegetables for Som Tum. Cooked in microwave oven for a few minutes, you can enjoy the authentic Thai Som Tum in terms of taste, sweetness, as well as preserved nutrition
‘Kessara Bakery Shop’ has an idea to bring Pla Shaon, local fish in Singburi, as an important ingredient for cake and ice cream
‘Proud’ is the Thai sweet brand name. Its selling point is to package Thai traditional sweets and dried fruits in nice-looking forms. It is suited for gifts in every occasion.
Difference between Supply Chain and Value Chain
Thank You
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