Value Chain Dvelopment Manual FINAL DRAFT

ACRONYMS
MSE Micro and Small Enterprise
TVET Technical and Vocational, Education and Training
TeCAT Technology Accumulation and Transfer
IES Industrial Extension and Services
GTP Growth and Transformation Plan
GDP Gross Domestic Product
TT Technology Transfer
SME Small and medium manufacturing enterprise
VC Value chain
TAP Technical advisory panel
TEP Technical experts’ panel
MoA Ministry of Agriculture
DEFINITION OF KEY WORDS
Value Chain Development Manual [2]

VALUE CHAIN- is a sequence of target-oriented combinations of production factors (From
input to the market forspecific product/services) that create a marketable product or service to the
final consumption.
VALUE CHAIN ANALYSIS - describes the activities within and around an organization, and
relates them to an analysis of the competitive strength of the organization.
AS IS - is the actual or existing sequence of activities to deliver a product or services to the

market by an enterprise.
TO BE - represents the benchmark or the standard, or a set of standards, used as a point

of reference for evaluating performance or level of quality.
BENCHMARKING - The process of comparing own performance parameters with the

performance parameters of businesses or value chains considered the leaders in the field.
GAP- is something missing from an activity or a system thatprevents it from

being complete or perfect; the difference between As Is and To Be/benchmark.
MAIN CHAIN- is a major activity of workflow in a value chain.
SUB CHAIN- is a sub/support activity of workflow in a value chain.
SIMPLE VALUE CHAIN- value chain development techniques describes the full range of
activities, which are required to bring a product or service from the immediate input.
EXTENDED VALUE CHAIN - value chain development techniques that much more complex
than simple value chain that tend to be many more links in the chain.
INDUSTRY EXTENSION SERVICE - Newly developed instrument to capacitate micro

and small enterprises by applying the four packages called; technical skills gap training, kaizen,
technology transfer and entrepreneurship training.
SKILLS GAP TRAINING- is training given by the TVETs to the operators of the
MSEs after they identify their skill gap.

TECHNOLOGY TRANSFER - is TVETs’ creating, producing, transferring of new means of
production or service to the MSEs for better productivity and profitability.
KAIZEN - continuous improvement in production or service providing activities.
ENTREPRENEURSHIP- is training given by TVETs for a operators of the MSEs to

organize and manage a business undertaking, assuming the risk for the sake of profit.
TECHNICAL AND VOCATIONAL EDUCATION AND TRAINING - form of education
where learners acquire skills, knowledge and attitudes.
Contents

1. INTRODUCTION.............................................................................................................................5
2. GENERAL OBJECTIVE..................................................................................................................6
2.1. SPECIFIC OBJECTIVES.................................................................................................................6
3. SCOPE OF THE VALUE CHAIN..........................................................................................................7
4. VALUE CHAIN CONCEPTS AND DEVELOPMENTAL APPROACH..............................................7
4.1.Concepts............................................................................................................................................7
4.2.General Principles..............................................................................................................................8
4.3.Policies And Strategy........................................................................................................................9
4. 4. Value Chain Development Approach............................................................................................10
5. BENEFITS/ IMPORTANCE OF VALUE CHAIN DEVELOPMENT.................................................11
6. CATEGORIES OF VALUE CHAIN.................................................................................................12
6.1. Extended value chain....................................................................................................................12
6.2. Simple Value Chain Technique...................................................................................................14
7. STEPS OF VALUE CHAIN DEVELOPMENT...................................................................................16
7.1. SELECTION OF VALUE CHAIN.................................................................................................18
7.2 Data Collection................................................................................................................................21
7.2.1. Planning And Preparation........................................................................................................21
7.2.2. Gathering Tool Development...................................................................................................21
7.3. Mapping Value Chain Activities.....................................................................................................22
7.4. Value Analysis................................................................................................................................26
7. 5. Identification Of Gaps/Constraints................................................................................................29
7.6. Prioritizing the technology Gaps/Constraints............................................................................30
7.7. Technology Identification and Categorization...........................................................................30
7.8 Validation........................................................................................................................................33
7.9. Assessment and Evaluation............................................................................................................34
8. ROLE OF ACTORS AND STAKEHOLDERS.....................................................................................34
8.1. Roles of actors................................................................................................................................35
8.2. Roles of stakeholders......................................................................................................................37
9. ANNEXES............................................................................................................................................37
References.................................................................................................................................................51

1. INTRODUCTION
The growing integration of the global economy has provided the opportunity for substantial
economic and income growth. The fact that globalization in this new era has also come to
include the production of agricultural products and manufactured componentslinked and
coordinated on a global scale has opened significant opportunities for developing countries.In the
same context, promoting value chain development is increasingly being recognized as a
promising approach to address economic development, Technology identification, job creation
and a wider range of social and environmental development issues.In recognition of the
increasing importance of value chain approaches in development,Value chain analysis is the
simple and better way to formulate competitive strategies, understand the source(s) of
competitive advantage, and identify and/or develop the linkages andinterrelationships,
constraints and interventionbetween activities that create values.
Value Chain development has been already practiced in TVET;in fact, hundreds of value chain
are developed and many technologies transferred to enterprises. TVET through Technology
Accumulation and Transfer (TeCAT), recently experienced a tremendous resurgence of interest
in promoting value chains as a way to identify technology, add value, diversify economies, and
contribute to Micro, Small and Medium Enterprise in all sectors. Value chains are recognized as
a means to reduce the poverty prevalent in the country, not just as a means of strengthening the
linksbut also as opportunity of the need to identify and tap into new sources of potential growth,
value addition and technology intervention in all sectors, this is a welcome development.
Hopefully; renewed engagement will lead to a substantial increase in the flow of technological
resources and assistance that is dedicated to supporting sustainableindustrial and agricultural
value chains throughout the country.
Even though value chain development practiced so far, it is not standardized and developed
without the involvement of the sectors and generally assumed to be responsibility of TVET more
specifically the trainers.Furthermore,lack of clarity about the concepts and methods relating to
value chains, there was a challenge that sooner or later the benefits of the value chain approach
were overshadowed by unmet expectations. Since there was no a particular way to alleviate such

challenges; therefore this manual is developed and expected to offer a useful guidance to who
lead efforts to implement value chain analysis. The Guide is particularly designed to give
emphasis on principles and methodologies of how value chain is developed and further expected
to provide into value chain selection, mapping, value analysis for activities, identification of gaps
by comparing the existing situation (As Is) approaches with benchmark (To Be) and provide
technological solutions for the gaps in line with GTP priority sectors. Finally, this manual
encompasses monitoring and evaluation checklist to measure performance of any developed
value chain in gap and solution identification in relation to the standard.
2. GENERAL OBJECTIVE
The overall objective of this manual is toguide how to develop a competitive and well-organized
value chain analysis in order to identify viable technologies to bring a sustainable development
in all enterprisesover the country.
2.1. SPECIFIC OBJECTIVES

The specific objective of this manual address how to:
 To identify a number of technologies by comparing the AS IS to benchmark.

 Provide information on the conceptual fundamentals of chain analyses, highlighting the
constraints prioritization and technology identification.
 To identify technologies gaps for 100% technology copying and project based training
purposes.
 Transfer the identified technologies to the enterprise to ensure the competitiveness.
3. SCOPE OF THE VALUE CHAIN
This manual addresses all GTP priority Sectors and Sub Sectors, TVET, Research institutes,
Universities, Industries and those who are working for the development and competitiveness of
micro, small and medium(manufacturing) enterprises at the sectors, subsectors and commodity
levels, who lead efforts to implement value chain analysis in their organizations.

4. VALUE CHAIN CONCEPTS AND DEVELOPMENTAL APPROACH
4.1. Concepts
The following are the list of literature concepts of value chain.
Michael Porter (1985)

Value chain is a concept proposed by Michael Porter in his book "Competitive Advantage"
in 1985. In this book, Porter explains that "Competitive Advantage" is the ability for a firm
to put "generic strategy" into practice.
Gary Gereffi (1990)

The primary focus of global commodity chain (GCC) analysis is the international trading
system and the increasing economic integration of international production and marketing
chains. It was developed primarily to analyze the impact of globalization on industrial
commodity chains. GCC highlights power relations that are embedded in value chain
analyses.
ApprocheFilière’, translated as Commodity Chain Analysis, CCA, is applied to the analysis

of existing marketing chains for primarily agricultural commodities, assessing how public
policies, investments and institutions affect local production systems.
Hopkins and Wallerstein 1986
A commodity chain is defined as ‘a network of labour and production processes whose end
result is a finished commodity.
A number of concepts and theories are available in related with value chain; different literatures
made by different authors define it in their own different ways. However, if we are going to
analyze the literature about value chain, we will come up with the understanding that value chain
is sequence of activities that an enterpriseoperating in a specific sector and sub sector performs
in order to deliver a valuable product or service to the market.
The value chain perspective provides an important means to understand linkages and
mechanisms for increasing efficiency.Finally, it provides reference points for improvements and

resides at the core of high impact and sustainable initiatives focused on improving productivity,
competitiveness, entrepreneurship, and MSE’s growth.
Value Chain Development in TVET
Being defined, as a key framework for understanding how a product moves from the
inputs/producer to the customer. And with the aim of the government to introduce Value
Chain Analysis as the simple and better way to identify the gap of technologies and come up
with intervention. The TVET conducted a number of value chain analysis so far.
The existing value chain development is done through analyzing the existing activities (As
Is) of enterprises and Benchmarking international standards as a basis of identifying
gaps/constraints to come up with technological intervention. The Interventions covers the
project-based training and 100% technology Copying conducted by the TVET, later on
expected to be transfer,and disseminated to the Enterprises.
4.2. General Principles

Value chain contains at least the following general principles. Value chain should be:
 Coincided with GTP priority sectors

 Developed cooperatively with different sectors, sub-sectors and with different expertise at
the product and services levels.
 Supported and coordinated with TVET and governmental and non-
governmentalconcerned organizations.
 Development focuses on technology identification in order to ensure MSE’s
competitiveness.
 Mapped with actual AS IS value chain and Benchmarked with international best
practices.
 Upgraded based on the latest trends of technologies.
 Validated, Documented and reported to concern organization

4.3. Policies and Strategy
The government of Ethiopia has formulated strategies and plans for rapid and sustainable
economic development, poverty reduction, industrial development strategy and others in a bid to
create favorable conditions for economic and social development. The economic development of
the country becomes true when the transformation from agriculture to industry is done as per the
plan indicated. Capacity building and creation of manpower capital in addition to technology
transfer and copying are the key pillars of those strategies. The Industrial Development Strategy
underlined the educational and training system of the nation must be geared to create technical
capable work force to attain the industrial development of the country sustainable and
competitive. The national TVET Strategy takes a key part of the economic development and
poverty reduction through capacity building and technology accumulation and transfer. From this
point of view the renaissance of the country will be accomplished in three main technology
trajectory phases; the first phase is imitation of technology/copy/(to 2025), the second phase is
improvement/adaptation/ of technology (2026-2038) and the third one is innovation phase
starting from 2039. Therefore, the focus of TVET is on technology imitation through 100% copy
and transferring to MSEs and SMEs (for manufacturing) until 2025.
Unlike other countries, the Ethiopian TVET strategy is highly responsible to support micro,
small and medium enterprises development through industrial extension and technology transfer.
As stated in the growth and transformation plan the economic development in Ethiopia should be
fast, sustainable, technological aided and create a massive job opportunities. To fulfill these
remedies a system put forward is capable of producing a series of technologies to be copied and
make competitive over the global market. The most suitable system developed in line with the
strategy is value chain development approach.
TVET institutions are expected to support the local small industries, usually MSEs, in filling
their skill gaps, giving training in entrepreneurial skills, technology transfer and improvement in
quality and productivity. Technology transfer as one of the core issues of industry extension
service, that identified from the value chain and copied by actors could be further transferred to
the nearby micro and small enterprises through multipliers, which creates a number of, job
opportunities and mitigating the problems as well as productivity constraints. From Value chain
development a number of technologies would be identified that will help for economic

development and transformation. Developing the value chain and implementing it properly is a
promising choice that satisfy the country`s industrialization agenda.
4.4. Value Chain Development Approach

Nowadays product/service providing enterprises achieve long-term competitiveness by providing
high-quality products and services at reasonable and competitive prices. To attain a competitive
advantage, the product/service providers has to match and then surpass their competitors, and
even discover what the customers want and satisfy their expectations. There are number of
alternative approaches in order to being competitive, from these value chain development is one
of the useful approach, since it analyzes the full range of activities that firms and workers do to
bring a product/good or service from its conception to its end use and beyond.For many countries
a value chain development refers to the full lifecycle of a product or process, including material
sourcing, production, consumption and disposal/recycling processes mainly applied in
entrepreneurs. In Ethiopia also there is a value chain development approach; in TVET sector it is
developed for identifying technology gaps from benchmarks/best practices and the identified
technologies are transferred to micro, small and medium enterprises to make them competitive in
the local and global market by providing quality product and services.
Generally, we use value chain development as technology identification approach in the view of
the following advantages;
 Helps to find out a number of technologies from one developed value chain at a time;
 Since value chain should developed with the involvement of stakeholders it helps to
acquire feasible and viable technologies
 Value chain development is a better way to gain practicable technologies.
 The identified technologies surely increase the productivity of enterprises, the reason
that technologies are tested and productive in the benchmarked.
 Benchmark shows the gaps how far the existing situation, so that this approach
facilitates technology copying.
 The technologies identified through this approach helps to create employment
opportunity and income for those who are engaged in technology copy and multiply.

Based on the approach of value chain development, Governance ensures that an interaction
between actors along a value chain development requires the contribution of stakeholders. Value
chain developmentis governed with parameters requiring product, process, and logistic
qualification are set which have consequences up or down the value chain encompassing bundles
of activities, actors, roles, and functions.Different actors in the linkages; that undertaken at
commodity/product, subsector, and sector levels and managed from federal to grassroots those
who are working for the enterprise competitiveness, coordinates value chains development.
Those key actors in the chain who take responsibility for the development of the value chain in
order to identify viable technologies and intervene on it.
5. BENEFITS/ IMPORTANCE OF VALUE CHAIN DEVELOPMENT
There are sets of reasons why value chain analysis is important in this era of rapid globalization.
They are the following:
1. Simple and better way to identify gaps and technologies.

2. Increases efficiency and systemic competitiveness of local enterprise
3. Primary targets involvement between local sector and sub sector
4. Reduces production costs and improves profitability
5. Improves customer satisfaction by providing quality product and services
6. Allows all actors and stakeholder to get broader picture of the performance of the sub-
sector
7. It denotes where or at which stage value is added and how muchinsight into why the firm
does or does not have added value; A way to identify opportunities to improve added
value;
6. CATEGORIES OF VALUE CHAIN
In value chain categorization, first we have to consider the GTP priority sectors those are the
broadest distinction between activities in an economy: e.g. Agriculture, industry. A value chain
can be developed in extended (value chains developed at sub sector level or across sectors) or in a
simple manner (value chain developed at product/services level). For the purpose of this manual
we select both the value chain development techniques that prepared at sub sector (All economic

activities involved in a specific product group or service: e.g. Metal Product, Textiles value chain)
and product/services levels (Specific e.g. Tomato value chain, Bed Preparation value chain).
The illustration about the extended and simple value chain;

6.1. Extended value chain
Type of value chain techniques that much more complex than simple value chain that tend to be
many more links in the chain, to mean that comprises of many sectors and sub sectors within a
series of chains to gain a final product/ services.
The extended value chain development has the following characteristics
 It should be developed at sector or sub sector level with the involvement of technical
experts from the sectors,
 Address all gaps in a sub sector or beyond,
 Conducted and facilitated by TVET sector at federal and regional level,

An extended Value Chain can focus on a sub sectors and the sector level. An example of extended
value chain prepared at the sub sectors level as shown below. The examples shows the Value
Chain for the whole process including growing and harvesting of cotton, textile production
(ginning, spinning, weaving, etc.) and garment production (designing, cutting, assembling, etc.)
and also whole selling and retailing.
Figure 1. Textile and Garment Value Chain

Figure 2. Rice Production Value Chain
Figure 3. Metal Product Value Chain
6.2. Simple Value Chain Technique
This is a type of value chain development technique that primarily focuses on activity analysis of
a specific product/commodity within sub sector. This type of value chain development technique
has the following characteristics
 Describes the full range of activities, which are required to bring a product or service
from the immediate input.
 Prepared by technical experts within a sub sector any level

 Conducted and facilitated by TVET structure at each level within local economic
corridor
A Value Chain can be developed for different sub sectors as product and services
 a Value Chain for Crop production sub sector; cotton (e.g. from land preparation to
harvesting of the cotton)
 a Value Chain for Textile sub sector (e.g. from using the cotton to produce yarn till
fabric)
 a Value Chain for Garment sub sector (e.g. from using the fabric to production of shirt
and marketing of shirt)
 a value chain for metal and metal engineering sub sector (e.g. from raw metal to
production of steel door)
 a value chain for leather sub sector (e.g. from finished leather to production of leather
bag)
An example of simple value chain as shown below;
Figure 1. Simple Value Chain for Tomato Production

Figure 2. Simple Value Chain for Leather Wallet Production
Figure3. Simple Value Chain for Guest Room Preparation and Services
7. STEPS OF VALUE CHAIN DEVELOPMENT
PREPARATORY 1. VALUE CHAIN SELECTION

PHASE
2. DATA COLLECTION
3. VALUE CHAIN MAPPING

VALUE CHAIN 4. VALUE ANALYSIS
DEVELOPMENT
5. GAP IDENTIFICATION
AND SOLUTION
6. PRIORITIZING CONSTRAINTS
7.TECHNOLOGY IDENTIFICATION &

CATEGORIZATION
CONCLUDING 8.VALIDATION
9. ASSESSMENT AND EVALUATION

Value Chain Workflow
Input Steps Results Responsibilities
GTP Different Actors agreed on
Identified Sector/Sub-Sector/Industry (1) Value Chain Selection joint plan Data about activities,
actors, constraints, etc.
Detailed data about sector, Techno based data Sector & Sub-
Manual: Data (2) Data Gathering Phase sub-sector or industry to be Human based data sector
Gathering Template able to develop value chain Orga based data representatives
Info based data with support
Value Chain description and analysis
Input from TVET

Manual:
* how to develop VC (1) Value Chain AS IS Value Chains incl.
(3) Value Chain Mapping
* Selection criteria for activities, actors, enablers,
benchmark (2) Benchmark Value Chain stakeholders, data
TO BE
(4) Value Chain Analysis Analyses done according to
• Yield, Quality, Cost, Time
As Is against the benchmark • Cost and Return Analysis
Set of criteria (5) Gap identification & = Gap Techno based Gap
Prioritization of the gaps Human based Gap
Orga based Gap
Designed Technology to close Info based Gap
(6) Technology gap
to Value Cain Identification and 100% Copy Team (=
Selection categorization department within TVET)
Designed Technology to close
gap
Project Based Training
(7a) Transfer to 100%
Intervention
Trained human resources, e.g. Team (= department

Copy team Lead trainers and/or TVET within TVET)
(7b) Project based trainers are trained to produce
Training technology Lead Trainers and/or
TVET Trainers and/or
Multiplyer MSE are trained Extension Agents
and know how to use or
(8) Assessment & produce technology
Evaluation
Conclusion
MSE is able to use technology

Target reached? and reach intended targets

7.1. SELECTION OF VALUE CHAIN
Value chain selection is the process of prioritizing

sectors, industries or value chains based on criteria
including their potential for growth and competitiveness,
impact, and contribution to other development objectives
such as MSEs development, Youth, women’s
empowerment, food security or natural resource
management. Therefore, the value chain selection
includes the following criteria but not limited.
A. GTP Priority Sectors
The Growth and Transformation Plan (GTP) is a national five-year plan created by the

Ethiopian Government to improve the country's economy.
The following table shows the ranking of the identified priority sectors, which says that
Agriculture is the main priority followed by other sectors within the country.
GROWTH AND TRANSFORMATION PLAN (GTP)
PRIORITY SECTORS
1 Agriculture 4.2 Road Transport
2 Industry development 4.3 Shipping Transport
2.1 Textile and Garment 4.4 Air Transport
2.2 Leather Industry Energy
2.3 Sugar 4.6 Water and Irrigation
2.4 Cement 4.7 Telecommunication
2.5 Metal Engineering 4.8 Urban Development
2.6 Chemical 5. Trade
2.7 Agro Processing 6. Health
3 Mining 7. Culture,Tourism,Sport
4 Economy and infrastructure 8. Social
4.1 Rail Transport

B. Size of Subsector
This is focus given to a subsector in enhancing the employment opportunity, GDP share in the
economy and the market share.
Employment
For countries like Ethiopia, unemployment is a critical problem. The selected value chain will
create a considerable amount of job opportunities and absorb unemployed labor force. Thus,
beyond supplying of quality products a value chain expected to reduce unemployment.
GDP share
An Economic development of a country is the total sum of GDP shares for every
product/subsector. A product that has a greater GDP share in an economy is more likely to create
jobs and alleviate poverty. A selected value chain should be those products/subsectors with a
relatively higher share of national GDP.
Market share
If a product is not competitive in quality and price on the market to satisfy customer
requirements it no longer exists in the market. Therefore, the value chain we are in a position to
develop should have a sustainable and significant market share.
Share of Export
The share of export represent the shares of the product/subsector from the country`s total export
of goods and services. The indicator measures the degree of importance of a product within the
total exports of country. The export share of a product/subsector is a determinant factor for a
value chain selection.
C. Growth Potential
Define as the mathematical probability that a business will become larger. The growth potential
refers to amount of sales or revenues the organization generates currently and keeps the future
demand and satisfaction. A growth potential is often the most important selection criteria
because without growth competitiveness a product/subsector cannot be sustained. A selected
value chain should have the potential to grow parallel to the customer`s growing demand.
Market potential
The estimated total sales revenue of all suppliers of a product in a market during a certain period
for both domestic and export scenario.

Factor condition (human, material, knowledge, capital, infrastructure)
Other condition factors related with human resources, the accessibility of the materials,
knowledge imposed, amount of capital and infrastructure in producing the product and services
should be considered in selection of value chain development.
Product diversification
Enterprise is expanding opportunities through additional market potential of an existing product.
Achieved by entering into additional markets and/or pricing strategies. Often the product may be
improved, altered or changed, or new marketing activities are developed. Value chain is
developing for products that have a potential to diversify.
D. Potential impact on MSE’s, youth etc
A value chain is developing to support MSEs with identified gaps. On the other hand, the
developed value chain promotes the establishment of MSEs by creating jobs, and strengthening
the linkages with large industries. Growth in industries with high rates of MSE participation and
employment will have an impact in reducing poverty more than growth in industries with low
employment and minimal MSE participation. A value chain that has positive contribution to
massive MSEs participation and job opportunity for youth should be selected.
E. Conservation importance
A production of environment friendly product and services, business operation with the utmost
consideration of the environment and natural resources that aims to identify the most significant
positive and negative impacts of the value chain on the environment and vice versa. To remain in
business and be profitable in the longer term, the value chains in which we develop need to be all
encompassing and green. Focusing on economic development alone brings environmental
damage, and therefore the selected value chain will have no/less harm on the environment that
enhances the quality of growth.
F. Women Empowerment
Women's empowerment, referring to the empowerment of women in our present society, has
become a significant topic of discussion in regards to development. An equal right for men and
women as basic human rights shouldgiven great considerations. The value chain that we are
going to select should consider gender equal opportunity.

7.2. Data Collection
7.2.1. Planning And Preparation
After the selection of the value chain to develop, the following are taking into consideration in
planning and preparation stage;
 Background; Review of the past and existing status (facts and figures) of the product
 Survey Area. Specific location to be visited in order to acquire the existing situation (AS
IS) for value chain development.
 Survey Period. Specific Date and a number of days covered during the field visit
 Target Respondents. Specific number, name of producer/ service provider within the
target survey area.
 Study Team. A group composed of different technical expertise related with the sector or
subsector of the value chain analysis to be conducted.
7.2.2. Gathering Tool Development
In able to collect all the information needed for value chain development, a set of gathering tools
must be developed. A composition of qualitative and quantitative questions to identify primary
and support activities needed to do the mapping of the AS IS, which define as the existing
activities and practices of product/service providers.
Varieties of tools (questionnaires, interviews, literature reviews, observations etc.) are used to
assist in the data gathering process. Each type of tool provides alternative means to illustrate,
explain and specify exactly what must be delivered to meet the intended goals. The gathering
tool should be covered the name of the product and services selected, the background and
information of the selected enterprise, the inputs or initial resources to start an enterprise, the
main chain or the sequence of the main process and also the sub chain or the activities supporting
the main chain. The tool also includes the statement of the real problems and solutions existing
within the enterprise and finally the interventions given by the governmental and non-
governmental organizations.

7.3. Mapping Value Chain Activities
Mapping a chain means creating a visual representation or a flow diagram of the connections
between activities in value chains as well as other market players. It helps to illustrate and
understand the process by which a product goes through several stages until it reaches the final
customer.
Activity Analysis, The identification of the activities undertaken by the enterprise that
contributed to the delivery of the product or service. After the identification the survey team will
do, the brainstorming with the activities identified which are the Main Chain and the Sub Chain.
The purpose of mapping the value chain is to translate the findings of the gathering of data into a
Value Chain. The Value Chain map is a simple tool, which visualizes complex things we find in
reality.
Mapping of a Value Chain follows a certain terminology, meaning that
 The Main Chain is a major activities of work flow in a chain that are written down using
a BLUE arrow box
 The Sub Chain is a sub/support activities of work flow in a chain that are written down
using a WHITE arrow box
 The AS IS: is the actual or existing sequence of activities to deliver a product or services
to the market by an enterprise.
 The TO BE:represents the benchmark or the standard, or a set of standards, used as a
point of reference for evaluating performance or level of quality.
Benchmark (TO BE)
Benchmarkis astandard, or a set of standards, used as a point of reference for

evaluating performance or level of quality. Benchmarks may be drawn from a country's
own experience, from the experience of all sectors from the other country.
Benchmarking
The process of comparing own performance parameters with the performance parameters of
businesses or value chains considered the leaders in the field. Parameters can refer to various
aspects. Important benchmark parameters are productivity, cost of production or product

quality. Benchmarking is uses to identify gaps in the performance of the value chain
promoted.
Factors consider during selection of benchmarking but not limited;
 Productivity(quality, production/yield, cost)
 other condition factor(level of technology, skill, employment/ labour intensive,
environment,)
The following examples are (fig. 1, fig. 2, fig. 3,) illustrated the above mentioned:
fig.1a Rice AS IS value chain

Fig1b. Rice To Be value chain
Fig2a. Guest Room preparationAs Isvalue chain

Fig2b. Guest Room preparationTo Be value chain
Fig3b. Metal and Metal Engineering To Be value chain

7.4. Value Analysis
Value Analysis is analyzing value of each activities and how it is undertaken in existing
situation(AS IS) with respect benchmark. A value analysis, providing both qualitative and
quantitative background information for activities to be analyzed; Sources of information for
this analysis may include secondary data, published or unpublished literature, surveys, focus
groups, and rapid appraisal. A major goal of analyzing is to identify any “bottlenecks” in the
value chain.
The identification of the factors that the customer’s value in the way of the conduct of each
activity and then work out on the changes that are needed.
Method of Comparative Analysis
All data and information gathered in Value chain can be analyzed using a combination of the
following methods.
A. Four Parameters (Yield, Quality, Cost, Time)

B. Line Graph
C. Cost and Return Analysis
A. Four Parameters (Yield, Quality, Cost, Time)
The process of analyzing the Value chain activities is according to the four parameters (Yield,
Quality, Cost and Time) to identify the Gaps between AS IS compared to the Benchmark. The
four parameters defined as flows:
Yield – refers to level or number of output acquired
Quality – refers to the level of standard applied
Cost – refers to the amount of money allotted in a specific activities
Time – refers to the specific duration, time limitation in performing the activities
The following is an example on how to analyze the value chain in rice production. The main
Chain and Sub Chain should be listed and using the four parameters, which are the yield, quality,

cost and time, we can compare already the benchmark versus the AS IS. Using this approach we
can clearly see the difference between the two elements.
B. Line Graph
The following chart shows an analysis of the rice yield using the line graph. This is just to show
the trend of the yield of the rice.

C. Cost and Return Analysis
The following table shows the Cost of production analysis and the return of investment in rice
production, comparing the AS IS versus the TO BE. Which shows that weeding activities
cover26%(AS IS) of the cost of production. Therefore weeding appears to be the constraints in
rive value chain.
7.5. Identification Of Gaps/Constraints
Literally, a gap is something missing from an activity or a system that prevents it from

being complete or perfect. Nevertheless, in this manual identification of a gap means the
difference between the existing situation (AS IS) and the benchmark (TO BE) with the concern
of technology. Technology is simply a conversion of input into marketable output.
Constraints/Gaps Analysis of a Value Chain follows a certain terminology, meaning that

 The Main Chain Gap of a Value Chain are written down in the following manner, using
an RED arrow box
 The Sub Chaingaps under a certain chain are written down using a YELLOW box

The Critically Mismanaged Approach represents the SUB CHAIN available in the AS IS and
BENCHMARK but still needs a critical attention. It is written using a GREEN box.
Rice Production Value Chain (Constraints/Gap)

CULTIVATION & PRODUCTION & POST- HARVEST
INPUT PROCESSING MARKETING
PLANTING MANAGEMENT (40% LOSSES)
CAPITAL INJERA, TELA

PESTICIDE SOIL TESTING GROWTH MONITORING THRESHING MAKING
soil test kit on time(mechanical, 2 WHOLESALE
FARM SITE FERTILIZER ha/day)5hp local market/export
RICE
(Adequate IRRIGATION & DRAINAGE
CROPPING FARINACEOUS
Irrigation) soil CALENDAR Dishes
moisture required DRYING RETAIL
for upland, LAND SOAKING IRRIGATION & DRAINAGE ,mechanical if rainy BEVERAGE 35-40 birr/kg,
lowland-5cm season ,sun Production Display
drying(concrete) Management with
WEEDING
TOOLS & BAKING & PASTRY price and variety tag
(once) (Proper Plowing has great affects on
EQUIPMENT weeding, spray 1day/ha,2hp, manual-1 Production
LAND STORAGE
PREPARATION day/ha 15hp, water prevent weeds to grow 12-14%
MANPOWER Mechanized MC)wooden/plastic Key
pallettes
INSECT & PEST CONTROL
Main Chain
SEEDS
SEEDLING MILLING
(inbred, HARVESTING
hybrid)lowland/u
PREPARATION
(67 qu/ha lowland)2 crop/yr upland,2-3 crop
In house,mobile miller,no Main Chain Gap
(Seed Soaking- broken grain,rice bran
pland /yr lowland,Harvester -
24h,incubation period-
Harvester/thresher(grains output) 3ha/day
taken by farmer Sub Chain
varieties,regular 36 h) 40kg/ha
PACKAGING
changing,
(moisture
Sacks,plastic,brandname, Sub Chain Gap
TRANSPLANTING labels
content 12-14 % Wet direct-Broadcast- Critically mismanaged
MC)pure,90- 100kg/ha Dry Direct- TRANSPORTING approach
100% GP, 120- 100kg/ha,20mm depth (tractor-
10-15 hp, 1day/ha
140 days trailer,jeepney,cart)
7.6. Prioritizing the technology Gaps/Constraints
The analysis of technologies constraints and gaps collected, and rank it according to the priority
using the following parameters.
1 Marketability
Attractiveness to potential buyers of the product and services
2 Profitability
Able to yield a profit or financial gain
3 Capability and Usefulness
Able to be used for a practical purpose or in several ways
4 Functionality
The quality of being suited to serve a purpose well
5 Import Substitution

Able to replace the product imported from outside of the country
6 Feasibility
State or degree of being easily or conveniently done within MSE’s level
7 Adaptability
Able to adjust into a local condition
8 Potential Impact to the MSE
Able to strengthen the linkages with Micro Small and Medium Enterprises
9 Woman Empowerment
Able to offer equal rights to men and women
10 Employment
Ability to utilize available manpower including persons with disability and can reduce
the unemployment rate in the country
7.7. Technology Identification and Categorization
Technology identification is the process of identifying technologies from the benchmark. If the
technology in the benchmark is somehow complicated and sophisticated with respect to the
country`s potential and focus, it is possible to look for other additional alternative technologies
(equivalent technology from other best practices) without compromising the quality and
efficiency.
Categorization of technology: The process of segregating identified technologies according to

four categories of technologies namely Techno ware, Human ware, Info ware and Orga ware.
The definitions of the four are follows:
TECHNOLOGIES DESCRIPTION
TECHNOWARE (TOOLS) Includes materials, gadgets etc. This component is the object-embodied
physical technologies, like tools & equipment, implements, vehicles and
machinery

HUMANWARE (SKILLS) Includes human knowledge, abilityand experience. This component is
the person-embodied art-of-doing technologies, like ingenuity, craftsmanship,
skills in performing the task.
INFOWARE (FACTS) Includes organized information, work processes, design etc. This
component is the record-embodies know-what–why-how-type technologies, like
systematized concepts and technical specifications (parameters, diagrams,
formulae, theories and manuals).
ORGAWARE (SETUPS) Includes organizational structures, setups, methods of doing things etc.
This component is the organization-embodied work-operations-schemes-type
technologies. Like Soil testing Laboratory, Food Processing Plant
The following is the example of actual four categories of technologies identified in Rice
production value chain analysis.
VALUE TECHNOWARE HUMANWARE INFOWARE ORGAWARE
CHAIN
CULTIVATION  Soil Test Kit  Prepare land for  Seed Quality  Seed Center
 Improved Iron Plough agriculture crop Manual  Soil Analysis
 Low Draft Chisel production – FCP  Soil Sampling Center
Plough L3 Manual  Mechanization
 Para Plough  Soil samples and  Land Bureau
 Tractor Drawn Bed analyze results – Preparation  Crop Insurance
Furrow Maker FCP L3 Manual Agency
 Spading Machine  Establish Nursery-  Seedling
 Power tiller FCP L3 Preparation
 Rotavator Manual
 Spring Tyne  Tractor
Cultivator Operation &

Maintenance
 Tractor Drawn Disc
Manual
Plough
 Tractor Drawn Disc
Harrow
 Mini Power Tiller

PLANTING  Seedling tray Transplant seedling – Transplanting
 Transplanter FCP L2 Manual
PRODUCTION &  Solar water pump  Undertake  Water Pump  Irrigation Bureau
MANAGEMENT
 Axial Flow Pump agronomic crop Operation  Integrated Pest &
PRODUCTION &
MANAGEMENT  Pruning Shear maintenance Manual Management
 Fertilizer Applicator activities – FCP L3  Tractor Bureau
 Foot Sprayer  Control weeds, pest Operation &
 Broadcaster and diseases in crop Maintenance

- FCP L4 Manual
 Low Volume Sprayer
 Implement plant  Water
 Boom Sprayer
nutrition program – Management
 Power Weeder
FCP L3 manual
 Rotary Weeder
 Undertake  Weed Control
 Rice Harvester
agronomic crop Manual
harvesting activities  Pest Control
– FCP L3 Manual
 Implement post  Organic
harvest program – fertilizer
FCP L3 Manual
 Supervise crop  IPM Manual
maintenance – FCP  Machine
L4 Operating
 Schedule irrigations Manual
– FCP –L4
 Monitor crop
harvesting program
– FCP –L4
POST HARVEST  Thresher with cleaner  Save, prepare and  Machine  Post Harvest
 Rice Mill permanent store agricultural Operating Center
 Rice Mill Mobile seed – FCP L3 Manual
 Tractor with cart

 Jeepney
 Storage room
 Paraboiler

The illustration below represents the rice production within agriculture sector and the linkages to
the other sector like the industry development sector, economic & infrastructure, trade, culture,
tourism and social sector. For example, the techno wares identified will be fabricated by metal
engineering sector; the food preparation of rice will be prepared by the hotel sector and so on.
7.8. Validation
Whenever a value chain analysis conducted, it needs to be validated. After full value chain
analysis is completed, technical advisory panel (TAP) at Sector-Industry Leading Body should
validate it. During validation,the validating body will check and review content accuracy,
completeness and relevance with the criteria listed in the annex 4. Then, the value chain analysis
approved for subsequent works of technology copy & transfer as well as project-based training.
7.9. Assessment and Evaluation
Assessment and evaluation measures the impact and outcomes of transferred technologies, which
identified from a value chain analysis to solve the constraints for industry competitiveness. After

the technological gaps of a sector/institution are complemented by the best technology from the
benchmark, the impact or outcome resulted from the application of the technology should
measured and known. Since this kind of measurement indicates the effectiveness of the
technology transfer system, it should be measured with special attention.
The assessment and evaluation is going to done based on the guideline specifically prepared for
measuring the outcome of technology transfer on hundred percent technology copy manual.
8. ROLE OF ACTORS AND STAKEHOLDERS
Actors are those who have direct engagement on value chain development. These are;
 Sectors, subsectors and development institutes

 Research institutions, Universities,
 TVET
 Industries, chambers
Stakeholders are those who support the value chain development. These are;
 Input suppliers
 professional Association
 NGOs
 Donors
8.1. Roles of actors
A. Sectors subsectorsand development institutes
 Develop their own sectorial and sub sectorial value chains,

 Develop value chains for each product/commodity,
 Being cooperativewhile value chain development,
 Intervene in the solution,
 Create awareness and build capacity on value chain,
 generate obligatory rules for the implementation of value chain,

 Validate the developed value chain,
 Designing and formulating Value chain Upgrading strategy,
 Conduct monitoring and evaluation,
B. Research institutions and universities
 Being cooperative while value chain development,
 Create awareness and build capacity on value chain,
 generate obligatory rules for the implementation of value chain,
 conduct Monitoring and evaluation
C. TVET Sector
i. Federal level
 createawareness and build capacity on value chain,
 Facilitate and work collaboratively with actors in the value chain development,
 Generate concepts for the implementation of value chain development.
 Generate obligatory rules for the implementation of value chain,
 facilitate the process of validating developed value chain,
 support and follow up the value chain development and implementation,
 Designing and formulating value chain upgrading strategies,
 Conduct Monitoring and evaluation,
ii. Regional level
 createawareness and build capacity on value chain,
 Facilitate and work collaboratively with actors in the value chain development,
 Generate concepts for the implementation of value chain development,
 Generate obligatory rules for the implementation of value chain,
 facilitate the process of validating developed value chain,
 carry out value chain development at a cluster level according to growth corridor,
 Implement the validated value chain accordingly,

 Designing and formulating value chain upgrading strategies,
iii. Zonal/district/city offices
 createawareness and build capacity on value chain development,
 Identifying local growth corridor for value chain development,
 Involve and work collaboratively with actors in the value chain
developmentaccording to their growth corridor,
 Implement the validated value chain accordingly,
iv. TVET institutes/
Dean, Industry Extension Vice-Dean:
 createawareness and build capacity on value chain development,
 Identifying local growth corridor for value chain development with local actors,
 Involve and work collaboratively with actors in the value chain development,
 Facilitate technology copy & transferimplementationfrom validated value chain,
Trainers
 Trainers can participate on value chain development as technical expert, if and only if
their expertise skill is desirable.
 need to have a clear understanding on value chain development, and implication on
technology copy & transfer as well as project based training,
D. Industries(from large to micro level)
 Being cooperativewhile value chain development,
 support all actors and stakeholder to get broader picture of the performance of the
industry,
 Indicates where or at which stage value is added and how much,
8.2. Roles of stakeholders
 Provide consulting.

 technical support on value chain development,
 support in financing the value chain development,
 share international experiences on value chain development,9.ANNEXES
ANNEX 1. Value Chain Selection Criteria Checklist
NO CRITERIA RATING REMAR

K
5 4 3 2 1
1 Size of Sub sector
This is focus given to a subsector in enhancing the employment opportunity,

GDP share in the economy and the market share.

2 Employment
For countries like Ethiopia, unemployment is a critical problem. The selected

value chain will create a considerable amount of job opportunities and absorb
unemployed labor force. Thus, beyond supplying of quality products a value
chain expected to reduce unemployment.
3 GDP Share
An Economic development of a country is the total sum of GDP shares for every
product/subsector. A product that has a greater GDP share in an economy is
more likely to create jobs and alleviate poverty. A selected value chain should be
those products/subsectors with a relatively higher share of national GDP
4 Market Share
If a product is not competitive in quality and price on the market to satisfy

customer requirements it no longer exists in the market. So the value chain we
are in a position to develop should have a sustainable and significant market
share.
5 Share of Export
Shares of the product/subsector from the country`s total export of goods and
services.
6 Growth Potential
The mathematical probability that a business will become larger.
7 Market Potential
The estimated total sales revenue of all suppliers ofa product in a market during
a certain period, for both domestic and export scenario.
8 Factor Condition (human, material, knowledge, capital,

infrastructure)
Other condition factors related with human resources, the accessibility of the
materials, knowledge imposed, amount of capital and infrastructure in producing
the product and services should be considered in selection of value chain
development.
9 Product Diversification

Enterprise is expanding opportunities through additional market
potential of an existing product. Achieved by entering into
additional markets and/or pricing strategies.
10 Potential impact to MSE
Promotes the establishment of MSEs by creating jobs, and strengthening the

linkages with large industries
11 Conservation importance
A production of environment friendly product and services, business operation

with the utmost consideration of the environment and natural resources
12 Women Empowerment
Women's empowerment, referring to the empowerment of women in our present

society, has become a significant topic of discussion in regards to development.
Equal rights for men and women as a basic human right is given great
considerations. The value chain that we are going to select should consider
gender equal opportunity
TOTAL RATING:
Comments:
ANNEX 2. Benchmarking Criteria Checklist
NO CRITERIA RATING REMAR

K
5 4 3 2 1
1 quality
2 production/yield

3 cost
4 level of technology
5 skill
6 employment/ labour intensive
7 Environmental issues
TOTAL RATING:
COMMENTS:
ANNEX 3. Prioritizing Constraints/Technology Checklist
NO CRITERIA RATING REMARK
5 4 3 2 1
1 Marketability
Attractiveness to potential buyers
2 Profitability
Able to yield a profit or financial gain
3 Capability and Usefulness
Able to be used for a practical purpose or in several ways
4 Functionality

The quality of being suited to serve a purpose well
5 Import Substitution
Able to replace the product imported from outside of the country
6 Feasibility
State or degree of being easily or conveniently done within MSE’s level
7 Adaptability
Able to adjust into a local condition
8 Potential Impact to the MSE
Able to strengthen the linkages with large industries
9 Woman Empowerment
Able to offer equal rights to men and women
10 Employment
Ability to utilize available manpower including persons with disability and can
reduce the unemployment rate in the country
TOTAL RATING
COMMENTS:
ANNEX 4. Validation
NO CRITERIA RATING REMARK
5 4 3 2 1
1 Accuracy
The degree to which the result of a measurement, calculation or specification
conforms to correct value or standard
2 Completeness

Having all the necessary or appropriate parts of the value chain analysis
3 Relevance
Closely connected or appropriate to the Ethiopia Growth Transformation Plan
4 Benchmarked
Followed a standard point of reference
Note: 5 = excellent, 4 = very good, 3= good, 2= poor, 1 = very poor, so the average result is ≥ 3.5 should
validated.
Validated By:
Name
Signature
Date
ANNEX 5.Data Gathering Tool Sample
Data Gathering Guide for

VEGETABLE VALUE CHAIN ANALYSIS
Type of Vegetable _____________________________
Name of Farmer : ______________________________

Address / Location : ________________________________________
Age : _____________ Civil Status : ______________ No. of Members in the Family : __________
Educational Attainment : __________________
Farmer Owner ( _______ ) Farmer worker (_____)
Main Source of Income : ____________________________ Other Source of Income : _______________
A. Field Description:
1. Farm Size : _________hectares
2. Location : _________ ha.
B. Source of water: -------- Please Check

1. Irrigation type 1.1 drip irrigation ________

1.2 furrow irrigation ________
1.3 gravity fed irrigation _____
1.4 rainfed _______________
2. Irrigation facilities
2.1 dam ______________
2.2 concrete reservoir _______
2.3 canal system __________
2.4 garden hose __________
2.5 shallow/ deep wells / ponds _____
2.6 motorized water pumps___
2.7 others, specify __________
3. River/Creek or Drainage ______
3.1 clean, free from dirt and contamination ______
3.2 dirty and polluted ______________
3.3 not so much dirt& ______________
3.4 clean water _______________
4. Adequate supply of irrigation equipment. Yes/No _________
5. Who manage the irrigation system? Please check.
_______ farmers organization
_______ privately owned individuals
_______ government operate and manage
6. Do you get water on the right time? Yes/No _________
7. How do you rate the management of irrigation system? Please check
_______ excellent ______very satisfactory _______ Satisfactory _______fair _____ poor
8. Available repair shop in times of water pump machine failure or trouble.
______ there are repair shops in the area
______ there is limited repair shop in the area
______ there is no repair shop in the area
C. Do you have soil analysis? Yes / No. ______________
D. Cropping Calendar :
1. What month you start of land preparation? __________
2. What month you prepare the seedling? _________
3. Planting month ? ________________
4. Harvesting month? _______________

5. How many times to plant in one year? ___________
E. SEEDS
1. VARIETY USED (specify name of seed variety)
a. Ordinary seeds _________________
b. Hybrid ________________________
c. Inbred __________ ______________
d. Others, Specify __________________
2. SEED SOURCE
_________ From previous crop

_________ Purchase seeds from the market (local produce)
_________ Purchase imported seeds
3. SEEDS SUPPLY of improved seeds
_______ more supply
_______ enough supply
_______ lack of supply
4. SEEDS QUALITY
a. Is your seeds used is dried and clean? (Yes_____) (No _______)
b. Does your seeds free from virus & fungus? (Yes_____) (No _______)
c. Does your seeds used pure and free from other varieties ? (yes _____) (No ______)
d. Does your seeds used free from weed seeds and other contaminants like soil, stone?
(Yes_____________) (No________________ )
e. % of Germination/ Viability : Estimated germination rate _________
f. Seeds used. How many grams used per planting? _____________
_______ 50 _ 100 grams
_______ 101 - 200 grams
_______ 201 _ 300 grams
_______ 301 _ 400 grams
_______401 _ 500 grams or more
g. Cost of Seeds : 100 grams &. _______________ Birr
G. LAND PREPARATION
1. Manual with farm tools________________ Cost of labor:_____________ Birr
2. Use of Animal (____) How many times plowing? ______
Cost of labor : _______________Birr
Cost of Animal rental: ___________Birr
3. Mechanical : Yes/ No __________
Type of Farm machine /implements
a. Hand tractor ____________
b. Plow ______________
c. Harrow ___________
d. Four wheel tractor __________
e. Others, specify ________________
Cost of mechanical land preparation ____________Birr
H. BED PREPARATION
1. Raised bed (Yes/No_______ ). If yes, how much Cost of labor: ____________

2. Bed measurement is
______ 1 meter width to any convenient length ________less than 1 meter
______ more than 1 meter width ________no exact measurement
3. Bed height : a)4-10 cm_______ b) 11-17cm _________ c. 18 -30cm _________

4. Do you use plastic mulch for the bed? ( Yes/No) ____ ____
5. Organic fertilizer is applied during plot making. (yes or No ) ________

6. Water for plants is available anytime? ________Not a problem
_______ Not a serious problem
_______ A serious problem
_______ A very serious problem
If a problem, please specify the causes of the problems
_____________________________________________________________________
_____________________________________________________________________
7. Cost of bed preparation _____________ Birr
I. SEEDLING PREPARATION
1. Seeds sowing a. Seeds sown In bed. __________
b. Sown in plastic seedling tray. _________
c. Seeds are sown improvised seedling tray. ___________
2. Do you use soil media for seedling preparation? (yes or No) _______
3. How do you prepare the soil media for sowing seeds?
a. You sterilize the soil media? __________
b. Just get soil from the garden area. __________
c. Mixture of garden soil, compost, organic soil, sand, etc. ________
4. Do you apply fungicide in the soil media? (Yes or No) __________
5. Do you regularly water your seedling? Yes or No) __________
6. Do you put mulching materials in seedling tray or bed ? (Yes or No) ______
7. Pricking of seedlings is practiced. (Yes or No) __________
No. of days from sowing to pricking ___________
8. Hardening of seedlings is practiced. (Yes or No) __________
No. of Days to harden seedlings to transplanting ________
9. Cost of Labor for seedling preparation&&. _______________Birr
10. Practice of soil treatment for the soil media ..& Please check
__________ soilsolarization by sun drying
__________ chemical treatment with use of fungicide/insecticide
__________ bio control treatment by pouring boiling water
CROP ESTABLISHMENT
A. TRANSPLANTING:
1. How many days to transplant from sowing of seeds? ________
2. Method of planting : Manual ________ Mechanical ________
3. Direct transplanting is practiced. ( Yes or No) _________
4. What is the planting distance && a. between rows ___________cm
b. between plant __________cm
5. How many plants per plot? ________________
6. Plastic mulch is used in the bed to prevent weeds to develop . (Yes or No) ________
7. Fertilizer is applied in each hole during transplanting. (yes or No) _________
8. Transplanting is done ----- a. 10-20 days after sowing ______
b. 21-30 days after sowing _______
c. more than 31 days after sowing ______
9. Cost of labor in transplanting _________ Birr

B. WEED MANAGEMENT (Select or check )
1. Do you put Mulching materials (yes or No) ________.
If yes, what mulching materials?
a. plastic mulch _____ b. grass _____
2. Weed control is done manual. (Yes or No) ________
If yes, how many times weeding? _____________.
How much is the labor of cost for weeding? ____________Birr
3. When do you start weeding ? Please check .
______ 2 weeks after transplanting
______ 5 weeks or more after transplanting
4. What are the tools you used in weeding? Please check
_____ garden trowel
_____ wooden pegs
_____pick mattock ( Pick axe)
_____machete
_____ small knife
5. Weed control is thru the use of herbicide (Yes or No) ________
If yes, how much is the cost? _____________ Birr/ LITER
6. Weed disposal practices. Please check :
________ by burning the weeds
________ composting/ compost pit
________ just scatter in the garden area
7. Cost of labor for weeding ________________ Birr
C. PRUNING.
1. Do you practice pruning ? (Yes or No) ______
If yes, how do you practice? Please check
________ Remove all the auxiliary buds, flowers and fruits below the fork to allow
branches, flowers and fruits develop above the fork
________ remove the fruits, buds and flowers above the fork to develop fruits and
buds below the fork
________ remove the top of the main branch to develop more branch
2. When do you start to prune? Please check.

_______ when the shoots or buds are less than 4 inches
_______ when the buds are 5 -9 inches or more
_______ when the shoots or buds are 10 inches and above
3. Cost of labor for pruning ____________ birr
D. NUTRIENT MANAGEMENT
Common practice What Stage Applied How many Kg/Bags/Li Cost in Labor Cost
Birr/Kg/Bag/Li

1. Organic Fertilizer(Manure and
etc)
2. Inorganic fertilizer
a. UREA
B. DAP
C. Others____________
3. Use of Foliar
spray__________
E. Pest and Diseases Management
Common practice What Stage Applied How many Kg/Bags/Li Cost in Labor Cost
Birr/Kg/Bag/Li
1. Chemicals
2. Integrated Pest Managment
3. Biological
4. Manual
3. Other,Specify__________
E.1 Do you have problem in buying fertilizers & chemicals? Supply of fertilizers and agro chemicals
______ much supply _______fair supply
______ moderate supply _______ poor supply
______ enough supply
F. GROWTH MONITORING
a. Farmer always monitor the vegetable field? Please put check

________ Everyday ____ __ Only after 4-5 days
________ Every other day _______Once in a week
________ Every after 2-3 days
G. IRRIGATION
5.1 Water Availability . Is water a problem in production? Please check
________ Serious problem _______ not a problem
____ ____ A problem ________ not serious problem
5.2 WATERING
A. Common Practices. Please check the common watering practice for vegetable crops:
__________Furrow irrigation __________ Drip irrigation
__________Overhead irrigation __________ Manual watering
__________Garden hose __________ Others, specify please&..
B. Watering Schedule. Please check your water schedule to vegetables.

________Daily watering _________once every 4-5 days

________Every other day _________once in a week
________Once every 2-3 days
H. STICKING or TRELLIS/CAGING
(Applicable for vegetables like, tomato, eggplant, pepper, ETC.)
1. Do you put trellis or staking for plant support? ( Yes or No) ___________
2. If yes, what type&.
A. long stick vertical support or bamboo (yes/No) _______ If yes how long the stick?
How long is the stick? Please select : ______ 1 foot , _____ 2 feet, _____ 3 ft. _____4 ft& above
4. Horizontal support only? (Yes/No) ______

5. How much is the cost for staking ? _________________ Birr
I. HARVESTING
1. Time to harvest . Please check your answer on the common practice in harvesting tomato / pepper :
_______ when fruits are still green or breaker stage
_______ when fruits turn red or yellow
_______ when fruits are red or yellow
2. Harvest Interval . Please put check in your answer.
_______ every other day _______ 3 days interval _______ once in a week
3. Harvesting is done by
________ manual , how much is the cost of labor? : __________
________ mechanical , Cost of machine rental _________________
4. Equipment and materials used in harvesting. Please check the tools you used.
_______ wooden or plastic crate
_______ harvesting container or balde
_______ picking bags, baskets and buckets
_______ small cart for transporting
_______ none of the above materials used, only bare hands and plastic
or bags
5. Tools used in harvesting. Please check

_______ clippers and knives
_______ hand shears
_______ Others, specify ____________________________
6. Harvesting handling. Please check the common practice

_______ we put harvested fruits in balde or container and weigh
_______ we throw our harvested fruit to the crate
_______ we bring by hand the harvested fruit with care to the crate
7. What is your average yield per plant? Please check

_______ 0.50 kilo or less
_______ 0.6 - 1.0 kilo
_______1.1 - 1.5 kilos

_______ 1.6 - 2.0 kilos
_______ 2.1 _ 2.5 kilos
_______ 2.6 _ 3.0 kilos
_______ above 3.1 kilos
8. Total Yield income in Birr _____________________ /ha
9. Do you practice multi cropping system? Planting other vegetable crops aside from the tomato or
pepper in one cropping. Yes/ No ___________
If yes, Identify other crops you planted
___________________________________________________________
10. Do you practice diversified farming? Planting different vegetable in every planting season.
Yes/No____________,
If yes, identify the vegetable crops _______________________________________
POSTHARVEST
a. Post-harvest practices
______ Grading/Sorting (good / reject)
______Washing, Source of water in washing ___________
______Waxing
______Sizing (Small, Medium, Large)
______ packing
______ branding/labeling
Tools and equipment for packaging_____________________________
Packaging material cost:______________

Packaging labor cost:_________________
Number of Manpower:________________
_______Plastic material
_______Paper Material
_______Other, please specify______________
Packaging
problem:_____________________________________________________________________
____________________________________________
b. Storing
_______Concrete storage
_______Local materials, please specify_________
Storage
Problem:_____________________________________________________________________
____________________________________________
c. Transporting
_______Head loading
_______ manual transporting
_______using donkey
_______using cart/Gari

_______ jeep or truck
Transporting Problem._____________________________________________________________
_____________________________________________________________
_____________________________________________________________
MARKETING
Retail Price_______________________
Wholesale Price___________________
Target market
________local market or town market
________Supermarket (region__________ or Addis Ababa _______
________City Market in Addis Ababa
________Small scale retailer
________ wholesaler
________ food services ( e.g. to hotels and restaurants)
Marketing Problem: __________________________________________________________

__________________________________________________________
Plan for any crops to be planted in the future as diversified farming or crops? Please specify
________________________________________________________________
________________________________________________________________
ANNEX 6.Value Chain Template
References
1. Porter, Michael E. (1985). Competitive Advantage: Creating and Sustaining Superior

Performance. New York. Simon and Schuster. Retrieved 9 September 2013.
2. "Decision Support Tools: Porter's Value Chain". Cambridge University: Institute for
Manufacturing (IfM). Retrieved 9 September 2013.

3. Porter, Michael E. (1979). "How competitive forces shape strategy" (PDF). Harvard
Business Review. Retrieved, 9 September 2013.
4. Angel Gurría (5 November 2012). The Emergence of Global Value Chains: What Do
They Mean for Business. G20 Trade and Investment Promotion Summit. Mexico City:
OECD. Retrieved 7 September 2013.
5. Ghemawat, Pankaj (Spring 2002). "Competition and Business Strategy in Historical
Perspective". Business History Review. Harvard Business Review.
6. Pierre LeBlanc; Stephen Matthews; KirstiMellbye (4 September 2013). The Tax Policy
Landscape Five Years after the Crisis (Report). OECD Taxation Working Papers.
France: OECD. Retrieved 7 September 2013.
7. Gereffi, G., (1994). The Organisation of Buyer-Driven Global Commodity Chains: How
US Retailers Shape Overseas Production Networks. In G. Gereffi, and M. Korzeniewicz
(Eds), Commodity Chains and Global Capitalism. Westport, CT: Praeger.
8. http://unctad.org/en/PublicationsLibrary/diae2013d1_en.pdf
9. Jonathan Mitchell; Christopher Coles & Jodie Keane (December 2009). "Upgrading
Along Value Chains: Strategies for Poverty Reduction in Latin
America" (PDF).Comercio y Pobreza en Latino América (COPLA). Briefing Paper.
London: Overseas Development Institute.
10.Microlinks (2009) [Value Chain Development Wikihttp://microlinks.kdid.org/vcwiki]
Washington, D.C.: USAID.
11.GTP I, (2010) , Ethiopian growth and transformation plan, Addis Ababa.
12.GTP II, (2015) , Ethiopian growth and transformation plan, Addis Ababa.
13.TVET, (2007), Ethiopian TVET strategy, Addis Ababa.
14.Jodie Keane, (2008), A new approach to global value chain analysis, overseas
development institutes London.
15.GTZ Eschborn, (2007) value links manual; The Methodology of Value Chain Promotion
First Edition,
16.Jon Hellin and Madelon Meijer, (2006), Guidelines for value chain analysis,
17. TVET, (2014), Federal TVET Agency Value chain analysis Manual first draft, Addis
Ababa, Ethiopia.

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ACRONYMS

MSE Micro and Small Enterprise

TVET Technical and Vocational, Education and Training

TeCAT Technology Accumulation and Transfer

IES Industrial Extension and Services

GTP Growth and Transformation Plan

GDP Gross Domestic Product

SME Small and medium manufacturing enterprise

TAP Technical advisory panel

TEP Technical experts’ panel

MoA Ministry of Agriculture

DEFINITION OF KEY WORDS

Value Chain Development Manual [2]

AS IS - is the actual or existing sequence of activities to deliver a product or services to the

TO BE - represents the benchmark or the standard, or a set of standards, used as a point

BENCHMARKING - The process of comparing own performance parameters with the

GAP- is something missing from an activity or a system thatprevents it from

MAIN CHAIN- is a major activity of workflow in a value chain.

SUB CHAIN- is a sub/support activity of workflow in a value chain.

INDUSTRY EXTENSION SERVICE - Newly developed instrument to capacitate micro

Value Chain Development Manual [3]

KAIZEN - continuous improvement in production or service providing activities.

ENTREPRENEURSHIP- is training given by TVETs for a operators of the MSEs to

Value Chain Development Manual [4]

Value Chain Development Manual [5]

Value Chain Development Manual [6]

2.1. SPECIFIC OBJECTIVES

 To identify a number of technologies by comparing the AS IS to benchmark.

3. SCOPE OF THE VALUE CHAIN

Value Chain Development Manual [7]

Michael Porter (1985)

Gary Gereffi (1990)

ApprocheFilière’, translated as Commodity Chain Analysis, CCA, is applied to the analysis

Value Chain Development Manual [8]

Value Chain Development in TVET

4.2. General Principles

 Coincided with GTP priority sectors

Value Chain Development Manual [9]

Value Chain Development Manual [10]

4.4. Value Chain Development Approach

Value Chain Development Manual [11]

5. BENEFITS/ IMPORTANCE OF VALUE CHAIN DEVELOPMENT

1. Simple and better way to identify gaps and technologies.

6. CATEGORIES OF VALUE CHAIN

Value Chain Development Manual [12]

The illustration about the extended and simple value chain;

Value Chain Development Manual [13]

The extended value chain development has the following characteristics

Value Chain Development Manual [14]

Figure 1. Textile and Garment Value Chain

Value Chain Development Manual [15]

Figure 3. Metal Product Value Chain

6.2. Simple Value Chain Technique

Value Chain Development Manual [16]

An example of simple value chain as shown below;

Figure 1. Simple Value Chain for Tomato Production

Value Chain Development Manual [17]

7. STEPS OF VALUE CHAIN DEVELOPMENT

PREPARATORY 1. VALUE CHAIN SELECTION

3. VALUE CHAIN MAPPING

Value Chain Development Manual [18]

7.TECHNOLOGY IDENTIFICATION &

9. ASSESSMENT AND EVALUATION