In ostrich farming, as with any other business, it is important to study the value chain to determine the best course of action for the business to be successful. With a value chain firmly understood, it is possible to support the development of a business plan, and also to build a business model most suitable for the profitable running of the production line. The idea of the value chain being to enlarge and maximize value of your production while minimizing costs of the production.
When plotting the value chain of the business, it becomes easy to identify the areas where value-adding activities can be pursued easily and cost-effectively in the business. While setting up the business plan for your ostrich farming operation, it is most important to identify such areas where the business could operate in to add value to the operation. Once this value chain has been identified and analyzed, a framework exists as a powerful management tool for strategically planning for the growth of your ostrich farming enterprise.
When setting up a value chain for ostrich farming, we need to look at the production line from the egg producing stage, right through to the slaughtering stage, and analyze every step in-between, and on to the marketing and finally selling of each product. The goal being to supply a product to the consumer at a price they find acceptable and affordable, and at the same time allows us to produce efficiently to our satisfaction as well.
Looking at a simplistic value chain for ostrich farming, we see the following steps in the production line:
• Supply of ingredients
• Ration designer
• Manufacturing of feed
• Incubation of ostrich eggs
• Rearing of ostrich chicks
• Processing of ostrich meat, ostrich skins and ostrich feathers
• Marketing of all products
Now you may ask what the difference is between the value chain and the supply chain, as they contain the same components. Let us look at the definition of each of these chains:
• The Supply Chain: The supply chain defines the section of the process that each producer is responsible for. In the supply chain, each section of the chain needs to generate income for the company responsible for that process. The producer will negotiate the lowest market price for goods they need to purchase, and will try to sell at the highest possible price. They will work for their own best interest, and not collaborate on price or quality. Buying is on an open market system, and no contracts are in place.
• A value chain is when the parties involved in all the processes in the supply chain collaborate to ensure that no value is lost throughout the process, due to poor performance or management. The different companies involved form alliances and contracts with each other in order to gain a better market, with greater rewards for all.
When ostrich farming is contemplated, it is important to develop a value chain approach, to ensure that the product remains traceable throughout the process. This can be achieved by a single company keeping control of the whole process in their ostrich farming enterprise, or by approaching independent producers and consumers of the product they are producing. With good collaboration in the latter instance, each producer remains independent in their operation, but work interdependently with their chosen business alliances, working towards a shared goal.
Whichever business model you choose to follow in your ostrich farming business plan, it is advisable to take the time to optimize your value chain for the growth and optimization of your company.