Building territorial

value chain

International Link and Services for Local Economic Development Agencies

for a fair, human, sustainable and inclusive development

2010

ILS LEDA Tool Kit n° 09

BUILDING    TERRITORIAL  VALUE  CHAINS  

ART  GOLD  LEBANON  PROGRAM  

The territorial endogenous potential is the ensemble of

different resources, potentially exploitable in order to build a

sustainable, durable and competitive development

ENDOGENOUS  POTENTIAL  

A  territorial  value  chain  is  a  chain  of  activities  aimed  at  producing  and  sell  certain  products  (i.e.  derived  by  milk  or  fruit  or  linked  to  textile  industry)  or  services  (i.e.  linked  to  tourism  or  education  or  health).    Activities  or  products  pass  through  all  components  of  the  chain  in  order,  and  at  each  activity  the  product  gains  some  value.  The  chain  of  activities  gives  the  products  more  added  value  than  the  sum  of  added  values  of  all  activities.      The  value  chain  categorizes  the  generic  adding  value  activities  ,  that  are:    •  The  "core  activities"  include:  inbound  logistic,  operations  (production),  

outbound  logistic,  marketing  and  sales  (demand),  and  services  (maintenance).    

•  The  "support  activities"  include:  administrative  management,  human  resource  management,  technology  (R&D),procurement,  etc.  

The territorial chains of value

v

Fruit andvegetables Marketing

Advertizing

Maintenance

Graphicdesigning

LabelRaw materialprocessing

Advice

Transportation

Packaging

ComputerSoftware

Mechanization

Maintenance

Information

Storage

Tools and spareparts

Production

Agro-industry

Tools and spareparts

Production

Maintenance

Glass or tinindustry

Ice-Industry

CHAIN OF VALUE FOR FRIUT AND VEGATABLEPRODUCTS

Cultural Events based on F&V

Specialised Services

Procurement

Waste Recycle

Energy

Quality Control

Research

Training

FINANCE

Restaurants, coffee bars. etc.

Accomodation

Training Equipments and

Tools

Cleaning

Information

Computer software

Maintainance

Arts & Crafts Inputs

Business Services

Equipment

Packing

Marketing

Advertising Laundries

Arte gráfica Imprentas

Transportation

Agriculture inputs

FIG 2b: LA CADENA DEL VALOR TURISTICA

Maintainance

Capacity Builiding

Design Quality Control

Quallity Contr

Cultural-Artistic-Sport Events

OrganisationServices

Computer software

Graphic Arts Printing

Arts & Crafts

Guiding

Security

Communicationes

Travel Agencies

Financial Services

Renting

Infrastr. Management.

 TOURISM  VALUE  CHAIN  

BUILDING, HOUSING

INDUSTRY, AND PUBLIC WORKS

HOUSE PRODUCTS

FURNITURES

WOOD INDUSTRY

CURTAINS

FRAMES

EQUIPMENT

GLASSES STOVES

SANITARIES

BAKED CLAY

FLOORS

ELECTRIC SYSEMS HYDRAULIC SYSTEMS

EQUIPMENT

MAINTENANCE

BRICKS KILNS

BITUMEN LIMES

EQUIPMENT

ROAD MAINTENANCE

EQUIPMENT

MAINTENANCE

FINANCE BUSINESS ASSISTANCE TRAINING INNOVATION

FIRST  STEP   Identifying  the  “holes”  

SECOND  STEP  Elaborate  a  chain  strategy,  for  responding  to  the  needs  of  a  complete  value  chain,  

infrastructure,  and  service  

THIRD  STEP   Set  up  the  value  chain  governance  mechanism  

BUILDING  VALUE  CHAINS  

FIRST  STEP   Identifying  the  “holes”  

Value  Chain  Businesses   Assessment   Constrains  to  the  full  chain  opera5ons   Ac5ons  

   

1.  Exist,  and  good          

2.  Exist,  but  weak          

3.  Not  exist          

   

1.  Exist,  and  good          

2.  Exist,  but  weak          

3.  Not  exist          

   

1.  Exist,  and  good          

2.  Exist,  but  weak          

3.  Not  exist          

   

1.  Exist,  and  good          

2.  Exist,  but  weak          

3.  Not  exist          

   

1.  Exist,  and  good          

2.  Exist,  but  weak          

3.  Not  exist          

HOW?   Starting  from  the  major  actors  of  the  value  chain,  and  adding  information,  through  the  other  ones  

FIRST  STEP   Typology  of  the  constrains  

Constrain typology Prioritization Scores DESCRIPTION

Ind. 1 Ind 2 Ind 3 Ind 4 Total

Infrstructure

Information

Production Services Finance

Individualism

Entrepreneurship

Comercialization

Technological Capital

Legal Framework

Total Average PRIORITISE THE SCORES ABOVE THE AVERAGE

SECOND  STEP  Elaborate  a  chain  strategy,  for  responding  to  the  needs  of  a  complete  value  chain,  

infrastructure,  and  service  

Strategic  Areas  

Finalisation  of  the  productive  value  chain  

•   Sensitization  and  Stimulation  •   Technical  Assistance  •   Credit  •   Training  

Quality  and  food  security  strategis  

•     Realisation  of  laboratories  •     Quality  Label  •     Training  

Actions  

Innovation  Strategies  •     Reinforcing  the  research  and  the  laboratories  •     Create  innovation  territorial  systems  •     Realise  concourses  for  the  best  innovations  

Marketing  Strategies  •     Brands  •     Creation  of  an  unique  value  chain  sale  structure  •     Improve  the  logistic  (transportation  and                outlets)  

THIRD  STEP   Set  up  the  value  chain  governance  mechanism  

Its  task  is  to  implement  the  collective  actions  of  the  value  chain:  •     common  marketing  •     common  procurement  •     lobbying  with  the  local  and  national  authorities  •  gathering  funds  for  the  common  interest  initiatives  (quality,  innovation,  trainig  centers,  etc.)  

The  mechanism  generally  is  a  CONSORTIUM  or  an  ASSOCIATION,  participated  by  the  entrepreneurs  and  the  other  institutions  related  to  the  value  chain  (universities,  training  centers,  service  entities,  Ledas).  

It  can  be  started  by  the  LEDA