Is there any real difference between a supply chain and a value chain?
To answer the question of the existence of a difference between supply chain and value chain, it is necessary to define theterms separately, even if they are often confused or interchanged.
The supply chain is the succession of processes and actions aimed to get the product from its original state (raw material), tocarry it between the factories and to the customer’s hand. Supply chain can also include the transportation from the customer to recycling companies after the use of it. Supply chain is related tocustomer’s need in the way that it will change depending on the customer’s need. For example, a change from poor quality to good quality of the products will change the purchasing process and maybetransportation process.
Value chain is a different notion. It is the succession of processes, actions and services aimed to add value to the item. It includes the steps of fabrication of the product, butalso the services provided to the customer such as customer service or warranties. Value chain defines the perceived value of the product depending on the satisfaction of a customer’s need, on thequality of the production, and depending on the peripheral services.
Value chain and supply chain are different but complementary things. What is important to understand is that the sum of valuechain is different from a customer to another, depending on how much he would pay for each characteristic of your product.
The supply chain depends on customer’s needs, given by the value chain. Mycustomer will evaluate the price of my product depending on its characteristics and define the value chain. That value chain will condition the supply chain depending on what the customer pays attentionto.
The supply chain changes as the value chain changes. In other terms, the value chain defines the supply chain.
Let’s take an example.
My company produces apple juice. To produce...
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