"Upstream" and "downstream" are business terms applicable to the production processes that exist within several industries. Industries that commonly use this terminology include the metals industry, oil, gas, biopharmaceutical and biotechnology industries. Upstream, downstream and midstream make up the stages of the production process for these and other industries.

1. SOKOINE UNIVERSITY OF AGRICULTURE
SCHOOL OF AGRICULTURAL ECONOMICS AND BUSINESS STUDIES
DEPARTMENT OF AGRICULTURAL ECONOMICS AND AGRIBUSINESS
AEA 202:INTRODUCTION TO AGRICULTURAL MARKETING MANAGEMENT
BSC.IWRE GROUP 02
INSTRUCTOR:MR SELUYINGA

2. PRESENTATION QUESTION
How could the linkage between upstream and downstream value
chain activities be enhanced?

3. 1.INTRODUCTION
What is a chain?
Is the full range of activities that businesses go
through to bring a product or service to their
customers.

4. EXAMPLE OF BUSINESS CHAIN

5. What is a value chain?
A value chain is a set of activities that a firm
operating in a specific industry performs in
order to deliver a valuable product or service for
the market.

6. Upstream and downstream
"Upstream" and "downstream" are business terms applicable to
the production processes that exist within several industries.
Industries that commonly use this terminology include the metals
industry, oil, gas, biopharmaceutical and biotechnology
industries. Upstream, downstream and midstream make up the
stages of the production process for these and other industries.

7. Upstream definition
The upstream stage of the production process involves
searching for and extracting raw materials. The
upstream part of the production process does not do
anything with the material itself, such as processing the
material. This part of the process simply finds and
extracts the raw material. Thus, any industry that relies
on the extraction of raw materials commonly has an
upstream stage in its production process.
 In a more general sense, "upstream" can also refer to
any part of the production process relating to the
extraction stages.

8. Examples of Upstream Processes
In the petroleum industry, locating underground or
underwater oil reserves characterizes the upstream
process. Additionally, the upstream process in this
industry involves bringing oil and gas to the surface.
Extraction wells represent an example of a structure
operating in this stage in the process. The upstream
stage in the production process may also manifest
itself as a supplier providing raw materials to
manufacturers or other businesses that ultimately
process the materials

9. Downstream definition
The downstream stage in the production process
involves processing the materials collected during
the upstream stage into a finished product. The
downstream stage further includes the actual sale of
that product to other businesses, governments or
private individuals. The type of end user will vary
depending on the finished product. Regardless of
the industry involved, the downstream process has
direct contact with customers through the finished
product.

10. Examples of Downstream Processes
In the oil and gas industry, the downstream process
consists of converting crude oil into other products
and then selling those products to customers. Thus,
oil refineries represent structures that operate within
the downstream process. However, any kind of plant
that processes raw materials may qualify as
operating within the downstream stage of
production. A company that combines both
upstream and downstream processes is an integrated
company.

11. Chain value activities

12. 2.Linkage between upstream and
downstream in value chain activities
The linkage exists when chain activities interact
from materials stage to final goods stage of
production.

13. Chain value activities that enhance linkage
between Upstream and downstream
Supportive activities
1. Firm infrastructure -involves organization unit
and different means of transport such as road,
railway lines which supports the production of
identical or differentiated goods and services
General management
Finance
Information Technology
Accounting

14. 2.Human resource management
Recruiting
Hiring
Training
Developing and compensating all personnel

15. 3.Technological development
Process design
Product design
4.Procurement
Purchasing raw materials
Supplies
Fixed assets

16. Main chain value activities
5.Inbound logistic
Call-off to suppliers
Materials handling
Warehousing
Inventory control
6.Operations
Conversion
Assembly
Packaging
maintenance

17. 7.Outbond logistic
Warehousing
Order processing
Picking
Shipment
Delivery

18. 8.Marketing and sales
Channel to markets
Product, picking, advertising and promotion,
distribution
Customer values, Cost to consumer,
Communication, Convenience
Sales force effectiveness
9.Service
Installation
Repair
Training

19. Conclusion
The value chain model is a useful analysis tool
for defining a firm's core competencies and the
activities in which it can pursue a competitive
advantage in terms of Cost advantage(by better
understanding costs and squeezing them out of
the value-adding activities) and Differentiation(
by focusing on those activities associated with
core competencies and capabilities in order to
perform them better than do competitors.

20. references
NetMBA. Value chain analysis retrieved on 02/01/2018
http://www.netmba.com/strategy/value-chain/
Ministry of Agriculture, Livestock and Fisheries. 3rd annual agricultural policy
conference serena hotel, dar es salaam 1-3 march 201.7.AAP press conference
http://foodsecuritypolicy.msu.edu/uploads/files/News/3rd_Conf_TZ/AAP_conference_
Abstracts_PRESS.pdf
Chron. The Definitions of "Upstream" and "Downstream" in the Production Proces.,
Retrieved on 03/01/2018. http://smallbusiness.chron.com/definitions-upstream-
downstream-production-process-30971.html
AEA 202, MR Seluyinga .lecture notes 2017-2018.

23. THE END