The AERU Value Chain Compass

Chain Leadership

Power

An important finding of the research is that the champion of a value chain is not necessarily the enterprise with the most market power. The most powerful partner is often the retailers, since they understand the values of their consumers, and they can control access to those consumers. An enterprise closer to producers and processors, however, may understand better the product’s attributes that drive its perception as being of premium quality in the eyes of consumers. This enterprise may also be able to communicate these attributes directly to final consumers (including through its trusted brand) as a away of increasing its power in the value chain.

Questions for developing a value chain

• Who holds the most market power in the value chain?

• Is this different from the enterprise who is the champion of the value chain’s vision and brand?

• How can other partners develop their market power in the value chain, including through their own engagement with the chain’s final consumers?