value-added chain

Value-added statementclick for a larger image
Fig. 85 Value-added statement. Value-added statement of Y Co for year ending 31 December 20xx.
Value-added chainclick for a larger image
Fig. 84 Value-added chain.

value-added chain

a chain of vertically linked activities which each add value (see VALUE ADDED) in producing and distributing a product. Depending on the nature of the product the value-added chain may involve a large number of vertically linked activities or only a few. Fig 84 overleaf, for example, shows one particular value-added chain in the petrochemical industry. Here the value-added chain involves converting a raw material (oil) into intermediate materials (ethylene and PVC), then into a finished product (plastic kitchenware), then packaging and physically distributing this kitchenware to consumers.

Strategically, where a firm ‘positions’ itself in the value-added chain for an industry can have an important bearing on its profitability since different activities within the chain may (because of technical and competitive considerations) generate different levels of profitability. For example, supplying unprocessed basic raw materials may yield low levels of profit compared to more skill-intensive later stage processing activities or the supply of high-technology ‘speciality’ inputs.

In many cases, firms will choose to embrace a number of ‘stages’ in the value-added chain as part of a vertically integrated operation in order to reduce costs or secure ‘tied’ input supplies or market outlets. See VALUE CREATED MODEL, VALUE CHAIN ANALYSIS, VERTICAL INTEGRATION.

Value-added chainclick for a larger image
Fig. 192 Value-added chain.

value-added chain

a chain of vertically linked activities that each adds value (see VALUE ADDED) in producing and distributing a product. Depending on the nature of the product, the value-added chain may involve a large number of vertically linked activities or only a few. Fig. 192, for example, shows one particular value-added chain in the petrochemical industry Here, the value-added chain involves converting a raw material (oil) into intermediate materials (ethylene and PVC), then into a finished product (plastic kitchenware), then packaging and physically distributing this kitchenware to consumers.

Strategically, where a firm ‘positions’ itself in the value-added chain for an industry can have an important bearing on its profitability since different activities within the chain may (because of technical and competitive considerations) generate different levels of profitability For example, supplying unprocessed basic raw materials may yield low levels of profit compared to more skill-intensive later-stage processing activities or the supply of high-technology ‘speciality’ inputs.

In many cases, firms will choose to embrace a number of‘stages’ in the value-added chain as part of a vertically integrated operation in order to reduce costs or secure ‘tied’ input supplies or market outlets. See VERTICAL INTEGRATION, VALUE-ADDED TAX.

References in periodicals archive ?
For value-added chain industry, the sales tax rate should be 0.
And last but not least, I'd like to thank all our partners in the value-added chain they've helped us by explaining the benefits of our development," said Jan Doldersum, Manager Marketing and Business Development at Rijk Zwaan Distribution B.
Duran Group is a global manufacturer of borosilicate glass and container solutions for the laboratory and industrial glass markets and possesses the entire value-added chain from the melting process to precision forming and working processes.
Wirecard will be located at stand 2216, where customers and interested parties can learn all about the latest payment solutions for the internationalisation of e-business across the entire value-added chain.
The new corporate design perfectly underlined the guiding idea of the exhibition to provide for more sustainability in the production processes of the textile value-added chain.
Well, he does not create that value-added chain and he is not behind it.
In value-added chain industry, GST should be collected at 0.
They represent the entire value-added chain for medical technology, from individual components and procedures for quality control to the finished product and related services for the complete product life cycle.
The GSP Plus status will revolutionise the textile sector with most of the benefit to be bagged by value-added chain, as 32 percent revenues are originating from the weaving and garments segments", an official document "Performance of the government: an overview during June-December 2013," said.
The overall textile sector is likely to benefit, but most of the benefit will be bagged by value-added chain (32 percent revenues originating from the weaving and garments segments).
The meeting also touched on the project to improve the quality and the value-added chain of the fish product as well as giving visibility in the coordination meeting for continuing to support the aquaculture and scientific researches.
Apart from boosting physical capital, he added, the government must also turn its energies to upgrade skills, move up the value-added chain and invest in human capital.