McCormick+Schmitz Handbook for value chain research on - PACA

− sourcing inputs
Inputs
− suppliers of yarn and cloth
− suppliers of accessories (buttons, zips, etc.)
− suppliers of packaging materials, hangers, plastic bags, boxes)
− equipment suppliers
Each of these activity groups can be subdivided further. More importantly, these
activities can be bundled (or unbundled) in different ways. For example, some large
retailers buy directly from producers rendering the wholesale function obsolete. Other
new activities have emerged, such as the development of brands which is often of
strategic importance. The key convention in good <strong>value</strong> <strong>chain</strong> mapping is to start with the
broad categories listed above and then to provide separate sub-maps of that part of the
<strong>chain</strong> which is of special importance to your investigation. (For examples, see chapter
10). Follow the same principle that is applied in an atlas. It would not be useful to
include the map of your city in the map of the world.
The advice to start with the broad picture be<strong>for</strong>e you narrow down may contradict good
pedagogic practice of starting with what you know well be<strong>for</strong>e you branch out. Out
advice stems from observing <strong>research</strong> on small enterprises and local networks. In this
field most <strong>research</strong>ers spent far too long investigating the locality and internal
relationships thus neglecting the external relationships, even though they often had major
influence on local development. Our argument is not to privilege the global over the
local, clearly it is the interaction of the two that we need to understand. Our suggestion is
that you grasp the broad picture as early as possible be<strong>for</strong>e you invest too much energy in
any particular part.
Conventions are also needed <strong>for</strong> distinguishing between different kinds of relationships.
In Chapter 2 we distinguished between four different types of relationships in the <strong>chain</strong>.
Here we introduce symbols <strong>for</strong> each type:
• market-based relationships: firms deal with each other in "arms-length" exchange
transactions =
• balanced network: firms <strong>for</strong>m networks in which no one firm exercises undue control
over others =
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