Understanding Chains

The simplified value chains were used to graphically show just what it takes to get a product ready for sale, and that there are value chains associated with all goods and services. Every link in the chain corresponds to action(s); that needed to be completed in a process. This is to visually give a big picture view of the range of actions involved in bringing a product from production to the market – the end user.

The hope is that their outlook would be expanded as a result; that they would look upon the process as a whole, to be aware that a lot more is involved in getting a product to the market than just the production of it. Their concentration, to date, had been on the production side. They seemed to be under the impression that sales would take care of itself once a product is made available.

I wanted to emphasise that much more concentration should be paid to the marketing and distribution end of the value chain. They have to understand that every link adds value to the final product. And that marketing and distribution is on the ‘higher value added’ end of the chain; that even though nothing is produced, the process of product packaging, marketing, and delivery is not cheap.

Furthermore, there is no distribution infrastructure within Maliana and the country, which means that they have to take on the onerous task of establishing distribution channels from scratch. Also, if they want to ensure sustainability of their enterprise, then they have to establish a market by ‘growing’ the market, only then would production be converted to sales and revenue. It was obvious, there was no other place for the NGO to be except at that end of the chain – the sucos they worked with had neither the ability nor capacity to handle the promotion and distribution of the product.

In the value chain analysis questionnaire for the marketing and distribution of compost in the fertiliser initiative, a series of focus questions have to be answered for every link in the chain. The questions are designed to solicit from them the actions needed to complete every link of the process. Once that has been done, the next step would be to use the answers to formulate a business and action plan.

The value chain analysis sheet is also designed project so that it can be adapted into an action plan. That is another problem faced in the NGO: the lack of proper action plans for projects; the simple who is supposed to do what and when.