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Value Chain Analysis: What it actually means?
Value chain analysis breaks down the activities required to deliver a product or service — from inbound logistics through operations, distribution, marketing and after-sales — to see where value is created, where costs are incurred, and where improvement or differentiation is possible. Consultants map the end-to-end chain, benchmark each step, and identify opportunities such as supplier consolidation, process automation, channel changes or service enhancements. This is particularly helpful when margins are under pressure and management needs to know which levers will have the biggest impact. A good value chain analysis underpins pricing, sourcing and make/buy decisions.
