Page 41 - STRATEGY FOR SUSTAINABLE AGRICULTUR AND RURAL DEVELOPMENT IN THE PERIOD 2021-2030 AND VISION TO 2050
P. 41
13. What are “supply chain” and “value chain”?
A supply chain is a network between has added some value. In agriculture, the
businesses and suppliers to produce and value chain of activities is necessary to turn
deliver a particular product to the end a product (service) from being a concept,
consumer. This network consists of different through the various stages of production, to
activities, people, entities, information delivering the product to the final consumer
and resources. Supply chain activities and discarding it after use (M4P, 2008).
involve converting natural resources and The value chain concept includes issues of
raw materials into products and delivering organization, operation, governance and
them to the end consumer . Thus, it can be relationships between actors in the chain.
7
understood that the agricultural product Agreements, arrangements and institutions in
supply chain is a series of interrelated the chain play an important role in value chain
business activities, from supplying management. Michael Porter (1985) pointed
agricultural product inputs to preliminary out that the value chain is a management
processing, processing and marketing to method in business administration to improve
selling the product to the consumer. the supply chain’s competitiveness. The value
The concept of the value chain was chain management model should first refer
mentioned by Michael Porter in 1985 to the management coordination institutions
when discussing the competitiveness of within the chain and the policy institutions
enterprises. According to Michael Porter, that create the operating environment for
a value chain is a sequence of activities in the chain and the adaptive technologies
which the product passes through all the necessary to operate the chain.
chain’s activities. At each activity, the product
7 Nagurney, Anna (2006). Supply chain network economics:
The dynamics of prices, flows, and profits. Cheltenham, UK:
Edward Elgar. ISBN 1-84542-916-8
41
Guidelines for the Strategy for sustainable agriculture and rural development
Guidelines for the Strategy for sustainable agriculture and rural development 41
in the period 2021-2030, and vision to 2050
in the period 2021-2030, and vision to 2050
