Value Chain Theory Of Coffee
The following chapter has made an attempt to elaborate several theories and concepts used in the study. A critical review of the previous research work is carried out in order to gain better understanding of the subject. The theoretical evidences are drawn from the value chain theory in conjunction with the theory of cooperative.
2.1 Theoretical Framework
2.1.1 The Concept of Value Chain
As described by Kaplinsky and Morris (2001), a value chain can be defined as “the full range of activities which are required to bring a product or service from conception, through the different phases of production, delivery to the final consumer and final disposal after use”. The study in the value chain sector will improve the attempt to understand the
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Albeit the concept is relatively similar, global value chain distinct because its activities that spread over international borders and not constrained within one country (Mitchell and Coles, 2011:11). However, producers in developing country often face important barriers in order to fulfil quality, standards and regulations in international market. Several authors, notably, De Janvry and Sadoulet (2005), Daviron and Gibbon (2002) and Reardon and Barret (2000) have described that lack of institutional and infrastructural support, availability of resources and efficient and effective coordination in value chain often hinders producers and smallholder farmers to increase their bargaining position in the value chain (Trienekens, …show more content…
The characteristics of the end-market will likewise bear upon the activities carry out by the actors along the value chain. Knowledge and willingness to comply with the demands in the value chain’s end-market, thus will be conditional to participation in high value adding value chains. For this cause, the key condition for the inclusion of producers in the value chain is access to market information and the power to translate it to market intelligence (Trienekens, 2011:53 ff). Meanwhile, Grunert et al. (2005) defined market orientation as “..chain members’ generation of intelligence referring to current and future end-user needs, dissemination of this intelligence across chain members and chain wide responsiveness to it” (Trienekens, 2011:53
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