Presented by Getachew Legese at the Africa-RISING Quick Feed Project Inception Workshop, Addis Ababa, 7-8 May 2012

1. Introduction to value chain analysis
Getachew Legese
Africa-RISING Quick Feed Project Inception Workshop, Addis Ababa, 7-8 May 2012

2. What is a Value Chain
• Value chains encompass the full range of
activities and services required to bring a
product or service from its conception to sale
in its final markets.
• VC includes input
suppliers, producers, processors and buyers.
• They are supported by a range of
technical, business and financial service
providers

3. The Value Chain and Business support services
Consumption
Retailing
Trading
Processing Research
Transportation
Trading
Govt. policy regulation
Transport
Communications
Post-harvest
handling Production input supply
Production
Tech. & business training & assistance
Financial services
Input
Suply Market information and intelligence

4. How to conduct a VCA
Value chain analysis consists of a four step
process:
1. Data collection,
2. Chain mapping,
3. Analysis of opportunities and
constraints, and
4. Validating the findings of the VCA through
stakeholders forum

5. Data collection
• Both qualitative and quantitative data are required
for the VCA.
• The qualitative data are collected using PRA tools
such as: Key Informant interview, focused group
discussions, personal observations, etc
• Quantitative data are collected using structured
questionnaire survey

6. Value Chain mapping
• Value chain mapping is the process of developing a
visual depiction of the basic structure of the value
chain
• The first step in VC analysis
• It serves both analytical and communication
• It reduces complexity of economic reality
• It encompasses
– Function
– Stakeholders
– Interdependencies
– Relationship

7. Analysis of Opportunities and Constraints Using
the Value Chain Framework
• The collected data is analyzed using the value chain
framework to reveal constraints within the chain that
limit the exploitation of end market opportunities
• The value chain framework comprises
– the structure and
– dynamics of the value chain.

8. Structure of the Value Chain
• The structure of a value chain includes all the firms in
the chain and can be characterized in terms of the
following five elements
i. end markets
ii. business enabling environment
iii. vertical linkages
iv. horizontal linkages
v. supporting markets

9. VC actors
Enablers
Supporters
Small Traders
farmers
Union
companies Operators

10. Dynamics of VC
• The dynamics of the VC refers to the determinants of
individual and firm behavior and their effect on the
functioning of the chain
• The dynamic of VC can be characterized in terms of the
following three elements
i. value chain governance
ii. inter-firm relationships
iii. Upgrading
• Validating the findings of the value chain through stakeholders
forum

11. Thank You!