S.Rengasamy – Sub sector / Value Chain Analysis for Livelihood Intervention
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Compiled by
S.Rengasamy
Madurai Institute of Social Sciences
S.Rengasamy- Sub sector / Value Chain Analysis for Livelihood Intervention
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Content
Sub sector Analysis / Value Chain Analysis forLivelihood Intervention
Box Footprints of commodities
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Why sub sector analysis
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Box 3 E Exercise
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Dia Sub sector model
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Dia Local Global value chain
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Dia Four stages of Sub sector analysis – Basix’s Model
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Box Sub sector analysis for pro poor growth
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Dia Value chain analysis
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Dia Poultry Chain
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What is a sub sector
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Box Value chain /Sub sector analysis can help
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Box Elements of sub sector analysis
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What is sub sector analysis
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Dia Steps in sub sector analysis
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Step A: Preparing a preliminary sub sector map
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Getting to know the sub sector
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Dia Framework for analyzing rural non farm sector analysis
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Dia Sub sector map : Green Beas for export
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Dia Stages in enterprise value chain
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Dia A Model –Ready made garment chain
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Dia Green Beas for export –Constraints and business service identification
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Box Value chain
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Box What does value chain analysis entail
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Step B:Interviewing key informants
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Box Sectors, Clusters & Networks
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Box Value chain governance
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Box Charcoal value chain
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Box Milk subsector value chain
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Step C:Drawing a preliminary sub sector map
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Box Community based retail enterprise sub sector
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Dia Community based retail enterprise sub sector
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Refining the understanding of the sub sector
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Box Social relationship in a charcoal value chain
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Specifying the institutional context
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Tab Regulation, Promotion, Credit, other institutional factors
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Step B: Specify the environmental context
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Tab Sub sector analysis
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Box What does upgrading means
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Step C: Refine the subsector map
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Dia Rice chain in Thailand
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Step D:Quantify overlays of particular interest
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Step 3: Analyzing sub sector dynamics and leverage points
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Analyzing the dynamics of the sub sector –i.e. Key demand, Technological change, Profitability,Risk, Barriers to entry, Large firm behavior, Input supply, institutional support, Identify sources of leverage points
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Choosing the right intervention point
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S.Rengasamy- Sub sector / Value Chain Analysis for Livelihood Intervention
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Sub-sector Analysis / Value Chain Analysis forLivelihood Intervention
Understanding economic system in which livelihoods operate
Why Sub-sector Analysis?
Micro and small-scale enterprises (MSEs) employ vast numbers of people throughout thethird world. They provide a key source of income for the poor and for women. Yet
MSEsstruggle to survive in a highly competitive, fast changing business environment. Someoperate in rapidly growing markets while others are squeezed by changes in demand,technology, labor costs, tariffs, input prices, government regulations and competition fromlarge firms and imports.In spite of their resourcefulness and savvy
,
small firms often lack political influence as wellas the vantage point from which to understand the overall competitive system in which theyoperate. Field agencies can help by serving as advocates, monitoring and influencing changefor
the benefit of micro and small-scale enterprises (MSEs). But to do so, field agencies
needways of identifying niches where MSEs have a competitive advantage so that these agenciescan
assist those MSEs with the greatest
potential while avoiding investment in areas wherethey cannot effectively compete. Subsector analysis offers a tool that can
facilitate small-firmmoves to promising technologies and market niches. Normally, a subsector is delineated by a particular final product and includes all firmsengaged in raw material supply, production and distribution of that product. In some cases,however, the defining characteristic is a key
raw material, with the subsector describingalternative transformations and distribution systems emanating from it. The hides and skins,cotton, and
citrus subsectors are examples of this second type. They are
common in theliterature on agricultural economics marketing,where they are known as commodity subsectors.Many of the analytical tools used in subsector analysis come from these early subsector studieson agricultural commodities.
Promoting individual enterprises to enhancethe livelihood among the poor people in anisolated and sporadic way may not be themost effective way to enhance theirlivelihoods
.An enterprise is not an isolated structure. It is organically connected horizontally andvertically with other enterprises and activities. Our effort may go waste if there are fault linesin the relationship. Enterprises can be established easily but to sustain it and upscale it, oneneeds to understand the large picture. There are several tools and techniques are used to
The 3-E Exercise (Exploring the ExternalEnvironment) helps us identify some of theruling bottlenecks that need to be overcome tosupport livelihoods of many people in the area.Step. 1: Identify Key InformantsStep. 2: Develop Questionnaire/check list forAssessmentStep .3:
Scoring by Key InformantsStep.4: Aggregate ScoresStep .5: Compare Scores of Different ActivitiesStep .6: Identifying BottlenecksStep .7: Identifying Interventions
"Once upon a time, we knew the origins of things: what piece of earth the rice on ourdinner plate came from, which well our water was dipped from, who cobbled our footwears, and whose cow provided the milk and leather. In many parts of the world, thatinformation is still readily available. But in the present day society, even as technologymakes certain kinds of information more accessible than ever, other connections areirrevocably lost."
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