{"id":28744,"date":"2023-10-26T13:24:24","date_gmt":"2023-10-26T13:24:24","guid":{"rendered":"https:\/\/swoopfunding.com\/ca\/?post_type=business-glossary&p=28744"},"modified":"2025-04-24T13:49:43","modified_gmt":"2025-04-24T13:49:43","slug":"value-chain","status":"publish","type":"business-glossary","link":"https:\/\/swoopfunding.com\/ca\/business-glossary\/value-chain\/","title":{"rendered":"Value chain"},"content":{"rendered":"

Definition<\/h3>\n

A value chain is a concept in business that describes the series of activities and processes a company undertakes to create, deliver, and provide value to its customers. <\/span><\/p>\n

What is a value chain?<\/h3>\n

A value chain encompasses the entire journey a product or service goes through, from its inception as raw materials to its delivery to the end consumer.<\/span><\/p>\n

Here’s a detailed breakdown of the components of a value chain:<\/span><\/p>\n

Primary activities<\/strong>: <\/span>These are the core activities directly involved in the creation and delivery of a product or service. There are five primary activities:<\/span><\/p>\n

    \n
  1. Inbound logistics<\/b>: This involves receiving, storing, and managing raw materials and components that are necessary for production.<\/span><\/li>\n
  2. Operations<\/b>: It involves converting raw materials into finished goods, assembling products, and providing services.<\/span><\/li>\n
  3. Outbound logistics<\/b>: This involves the processes required to get the finished product to the end consumer.<\/span><\/li>\n
  4. Marketing and sales<\/b>: This involves activities aimed at promoting and selling the product or service to customers.<\/span><\/li>\n
  5. Service<\/b>: This involves providing after-sales service and support to customers. It includes activities like customer support, maintenance, repairs, and warranties.<\/span><\/li>\n<\/ol>\n

    Support activities<\/strong>: <\/span>These activities are necessary to support the primary activities and contribute to the overall value creation process:<\/span><\/p>\n

      \n
    1. Procurement<\/b>: This involves the process of sourcing and acquiring the necessary inputs, including raw materials, supplies, and services, to support the primary activities.<\/span><\/li>\n
    2. Technology development<\/b>: This encompasses activities related to research, development, and implementation of technology and systems that enhance the production process and create competitive advantages<\/a>.<\/span><\/li>\n
    3. Human resource management<\/b>: This involves activities related to recruiting, training, developing, and managing the workforce to support the primary activities effectively.<\/span><\/li>\n
    4. Infrastructure<\/b>: This includes the necessary organisational structures<\/a>, systems, and processes that enable and support all other activities within the value chain.<\/span><\/li>\n
    5. Firm infrastructure<\/b>: This refers to the overarching organisational structure, including the company’s management, finance, planning, and quality assurance systems.<\/span><\/li>\n<\/ol>\n

      Example of a value chain<\/h3>\n

      Let’s consider a company that produces and sells smartphones. The value chain for this company can be broken down into several primary activities:<\/p>\n

        \n
      1. Research and development (R&D):<\/strong> Engineers and designers work to develop new features and improve existing technology for the smartphones.<\/li>\n
      2. Manufacturing:<\/strong> The components required for assembling smartphones are sourced from suppliers. The company then manufactures the smartphones in its production facilities.<\/li>\n
      3. Marketing and sales:<\/strong> The company promotes its smartphones through various marketing channels. Sales teams work to distribute the smartphones to retailers or directly to consumers through online platforms.<\/li>\n
      4. Product development:<\/strong> Based on market feedback and emerging trends, the company continuously iterates on its smartphone offerings, releasing new models with updated features and improvements.<\/li>\n<\/ol>\n

        Each of these activities adds value to the final product and contributes to the company’s competitive advantage and profitability.<\/p>\n","protected":false},"author":1,"template":"","class_list":["post-28744","business-glossary","type-business-glossary","status-publish","hentry"],"acf":[],"featured_image_urls_v2":{"full":"","thumbnail":"","medium":"","medium_large":"","large":"","1536x1536":"","2048x2048":"","image_blog":"","image_blog_full":"","image_podcast":"","image_banking":"","image_blog_internal":"","image_blog_medium":"","image_single_banking":""},"post_excerpt_stackable_v2":"

        Definition A value chain is a concept in business that describes the series of activities and processes a company undertakes to create, deliver, and provide value to its customers. What is a value chain? A value chain encompasses the entire journey a product or service goes through, from its inception as raw materials to its delivery to the end consumer. Here’s a detailed breakdown of the components of a value chain: Primary activities: These are the core activities directly involved in the creation and delivery of a product or service. There are five primary activities: Inbound logistics: This involves receiving,…<\/p>\n","category_list_v2":"","author_info_v2":{"name":"root","url":"https:\/\/swoopfunding.com\/ca\/author\/root\/"},"comments_num_v2":"0 comments","_links":{"self":[{"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/business-glossary\/28744","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/business-glossary"}],"about":[{"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/types\/business-glossary"}],"author":[{"embeddable":true,"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/users\/1"}],"version-history":[{"count":1,"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/business-glossary\/28744\/revisions"}],"predecessor-version":[{"id":38965,"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/business-glossary\/28744\/revisions\/38965"}],"wp:attachment":[{"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/media?parent=28744"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}