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Value Chain in Economic Viability

The value chain can be divided into two main categories: primary activities and support activities. Primary activities are directly involved in the production, marketing, and distribution of the product or service, while support activities provide the necessary infrastructure and resources to facilitate the primary activities.

Primary activities typically include inbound logistics (procurement of raw materials), operations (manufacturing or service delivery), outbound logistics (distribution and transportation), marketing and sales, and after-sales service. These activities are essential for creating and delivering value to customers.

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Support activities, on the other hand, include infrastructure (such as facilities, technology, and systems), human resource management, procurement, and research and development. These activities provide the necessary support and resources to enable the primary activities to function effectively.

The value chain concept emphasizes the importance of optimizing each stage of the chain to enhance overall economic viability. By analyzing and improving the efficiency and effectiveness of each activity, organizations can reduce costs, increase productivity, and ultimately deliver better value to customers.

Furthermore, the value chain approach also highlights the interdependencies and linkages between different stages of the chain. It recognizes that value creation is not limited to a single organization but involves collaboration and coordination among various stakeholders, including suppliers, manufacturers, distributors, retailers, and customers.

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In the context of sustainable development, the value chain concept can be extended to incorporate environmental and social considerations. This entails assessing and managing the environmental and social impacts associated with each stage of the chain, from resource extraction to waste disposal. By integrating sustainability principles into the value chain, organizations can enhance their economic viability while minimizing negative environmental and social externalities.

In summary, the concept of value chain in economic viability encompasses the series of activities and processes involved in creating, delivering, and capturing value for customers. It emphasizes the optimization of each stage of the chain to enhance overall efficiency and effectiveness. Additionally, it recognizes the importance of considering environmental and social factors to achieve sustainable economic development.

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Keywords: activities, economic, viability, primary, concept, service, support, customers, environmental