Value Chain Cost Research Articles

Value chain and production cost optimization by integrating additive manufacturing in injection molding process chain

Additive manufacturing (AM) can create considerable value when integrated into conventional manufacturing process chains. Tooling for new molded product development as pilot case of integration of AM in the injection molding process chain is investigated. The study shows that injection molding based on AM for fabrication of polymer tool inserts is economically advantageous allowing 80–90% production costs reduction as compared with a conventional tooling process chain based on machining. Fabrication of soft tools with AM results in a production lead time reduction in the range of 60–70% compared to the time required to machine mold inserts in brass or aluminum.

Cross-border E-commerce Mode Based on Internet +

To better use the efficient and low-cost trade mode of cross-border e-commerce, it was a major issue for scholars in various countries to study it in the context of “Internet +”. Based on the theoretical knowledge of value chain and transaction cost, the influence of B2C cross-border e-commerce on transaction cost in international trade was discussed. Secondly, the current problems of the current development of B2C cross-border e-commerce were analyzed. The concrete performance was the bad credit environment, the incomplete cross-border logistics system and the poor cross-border payment system. Finally, the problems pointed out in the previous article were confirmed, and the experience and lessons were summarized. At the same time, some suggestions were proposed to promote the development of cross-border e-commerce model based on Internet +. It is concluded that cross-border e-commerce is of great strategic significance to promote the reform and upgrade of the traditional foreign trade industry and maintain the stable economic growth.

The effect of logistic services on the watermelon value chain in Tanzania

ABSTRACTThis article reports on a study that aimed to understand the effects for poverty reduction of the link between logistic services and cost of the watermelon value chain in Rufiji and Mkuranga districts in Tanzania. Structured questionnaires and FGDs were used to collect data from 251 respondents. Findings revealed that transport cost, storage cost, purchase cost, and logistics service have strong significant effect on the watermelon value chain cost. Based on the findings, the study recommended the use of affordable methods of storage, opening agro-input shops in villages, and the development of a favourable environment for watermelon businesses, to help reduce chain cost.

A Design for Supply Chain Model by Integrated Evaluation of Design Value and Supply Chain Cost

A Design for Supply Chain Model by Integrated Evaluation of Design Value and Supply Chain Cost

A Metric for Quantifying Product‐Level Circularity

SummaryCircularity metrics are useful for empirically assessing the effects of a circular economy in terms of profitability, job creation, and environmental impacts. At present, however, there is no standardized method for measuring the circularity of products. We start by reviewing existing product‐level metrics in terms of validity and reliability, taking note of theoretically justified principles for aggregating different types of material flows and cycles into a single value. We then argue that the economic value of product parts may constitute a useful basis for such aggregation; describe a set of principles for using economic value as a basis for measuring product circularity; and outline a metric that utilizes this approach. Our recommendation is to use the ratio of recirculated economic value to total product value as a circularity metric, using value chain costs as an estimator. In order to protect value chain actors’ sensitive financial data and facilitate neutrality regarding outsourcing or insourcing, we suggest a means to calculate product‐level circularity based on sequential approximations of adding one product part and activity at a time. We conclude by suggesting potential avenues for further research, including ways in which the proposed metric can be used in wider assessments of the circular economy, and ways in which it may be further refined.

The Cost, Quality and Spillover Effects of Specialization Strategies in Hospitals An Analysis of the Patient's Value Chain

High-powered reimbursement systems such as capped budgets or prospective payment systems offer powerful incentives to hospitals to reduce their expenses, particularly in high cost areas such as operating rooms (ORs). Specialization is one prominent response strategy to such pressures. This study aims to explore how isolated specialization-based cost-reduction strategies in high cost areas affect the entire value chain. Our proxy for the follow-up costs of a patient’s case – and therefore of the value chain as a whole – is the probability of a patient experiencing a complication in the post anesthesia care unit (PACU). We focus on a specialization strategy that may result in individual (isolated) and/or organizational learning effects in the OR and/or lower costs from economies of scale. We found that this economic response strategy and short-term quality offered our hospital strategic complements, as specialization increased quality by reducing the probability of complications in the PACU, thus lowering follow-up costs. Notably, this finding held for both specialized and other types of surgery, which suggests the presence of spillover or organizational learning effects, thus confirming a decrease in overall costs by reducing overall follow-up costs. Thus, we find no evidence that specialization-based cost-reduction strategies threaten the overall development of value chain costs.

Forest biomass feedstock cost sensitivity to grinding parameters for bio-jet fuel production

Forest harvest residuals in the USA Pacific Northwest are a significant and largely underutilized source of renewable feedstock for “green” power. These forest harvest residuals are, however, not a uniform commodity and many choices can be made for source location, which tree parts to include in the harvest, how to comminute, transport, and process at a biofuels mill-site. Each of these many decisions can and should be informed by the overall impact on value chain costs, including all production costs and any impacts on the conversion process. The number of operational choices is large and the optimal solution not obvious. This paper explores the quantification of a number of the most likely significant operational choices in feedstock harvesting and preparation, and quantifies and ranks the main factors which can impact total value to the overall process of converting forest harvest residues to bio-jet fuel. Under the assumptions used here, total grinding costs are the largest cost impact factor, with a $26.12 per oven-dry tonne impact range. Higher bulk density (as long as moisture content is low enough) reduces hauling cost and is the second most powerful cost effect, having an impact range of $11.31 per oven-dry tonne.

Potential Consequences of the Energiewende for the Manufacturing Sector in Germany

Abstract2 The abandonment of nuclear power and new focus on renewable energy sources represents a fundamental change in the structure of Germany’s electricity supply. In the wake of this change in energy policy (which is widely referred to as an energy turnaround), prices started to rise immediately and further increases are to be expected in the years ahead. For the manufacturing sector, this cost burden has been mitigated by exempting energy-intensive sectors from additional costs. However, this causes high levels of uncertainty for large electricity consumers as their current exceptional status may be called into question at some point in the future. Moreover, the price and cost effects of the German energy policy are not only restricted to energy-intensive enterprises. The metal production, parts of the chemical industry and other industries closely linked to electricity consumers in a complex value chain face higher price and cost risks, as do large segments of the manufacturing sector, which work closely with energy-intensive companies. These dense networks are critical in the joint development of innovations, one of the German industry’s main competitive advantages. This strength of the German economy may turn into a risk if the future of electricity-intensive industries is hampered by rising national energy prices. A potential relocation of energy-intensive companies to other countries would also weaken the competitiveness of other areas of German industry. Such risks need to be compared with new market opportunities provided by the energy turnaround. The industry seeks those opportunities especially in renewable energies and techniques for improving energy efficiency.

정책적 안전재고의 비용 최적화 : 제록스 소모품 유통공급망 사례연구

Inventory, cost, and the level of service are three interrelated key metrics that most supply chain organizations are striving to optimize. One way to achieve this goal is to create a simulation model to conduct sensitivity analysis and optimization on several different supply chain policies that can be implemented in actual operation. In this paper, a case of Xerox global supply chain modeling and analysis to assess several what if scenarios for the consumable policy safety stock is presented. The simulation model, combined with analytical cost model and optimization module, is used to optimize the policy safety stock level to achieve the lowest total value chain cost. It was shown quantitatively that the policy safety stock can be reduced, but it is offset by the inbound premium transportation cost to expedite supplies in shortage, and the outbound premium transportation cost to send supplies to customers via express shipment, requiring fine balance.

The Windmill Approach

A common theoretical approach for understanding smallholder farmers' choice of sales arrangements is transaction cost economics (TCE), which usually focuses on a single transaction. However, farmers produce different crops and participate in several value chains simultaneously. Based on two case studies in central Mozambique, the authors propose an analytical framework that pays attention to both the production and the transaction strategies of farmers. This Windmill Approach acknowledges that farmers decide on participating in various value chains on the basis of multiple objectives and aspirations. Farmers prioritize the allocation of available resources towards the sustainability of the whole farm. Policy to support smallholder farmers' market access should not focus on single transactions, but on the combination of farming system and value chain costs and benefits.

Driving Toward User‐Centered Engineering in Automotive Design

In an industry worth more than €500 billion annually, producing more than 80 million vehicles worldwide each year and consisting of over 50 major manufacturers worldwide, the automotive industry represents a lucrative but highly competitive manufacturing industry (Deloitte, 2009a; European Automobile Manufacturers Association, 2012). With sales falling in Europe in 2013 for the sixth consecutive year (Boston and Curtin, 2014), automotive manufacturers are increasingly turning to new strategies to retain their share of sales in a contracting market. Some strategies have focused on the industry approach to manufacturing, namely, a technically focused push for a build-toorder process rather than the current build-to-stock approach in order to reduce overall value-chain costs and to increase efficiency (Parry and Roehrich, 2013, p. 13). However, others stress a more customer-orientated approach, striving to develop products that meet customer requirements (Oliver Wyman Group, 2007).

Life cycle optimisation of a sustainable Sago Value Chain

In line with global concern on the sustainable development, economic, environmental and social aspects should be considered simultaneously in an entire value chain. In this work, a cradle-to-gate life cycle optimisation (LCO) of sago value chain that involves plantation, harvesting and processing of sago starch as well as transportation of sago starch to customer is developed. In addition, fuzzy optimisation is adapted to minimise both total operating cost and workplace footprint of sago value chain. Note that in this work, the workplace footprint is divided into three levels of risk which are death (D), non-permanent disability (NPD) and permanent disability (PD) risks. These risks and operating cost are considered simultaneously and traded off to identify the optimum pathway with minimum risks as well as operating cost for sago value chain. A realistic case study is solved to illustrate the developed approach.

Chain of Values in Cost Management: A Strategic Analysis in Agricultural Cooperative Paraná, Brazil

The aim of this study is to analyze the strategic context in the value chain cost management in agricultural cooperatives in the state of Paraná. The contribution to the state of the art theme is directed exploration of the literature produced by different authors related. The strategic and competitive analysis seeks to identify which items make up the value chain of organizations and their influences on the execution, planning and control your costs. The methodology was characterized as an empirical-analytic study conducted by survey research, collection, observation and data analysis. The choice of the sample for sending questionnaires directed to the representative of the agricultural sector in Paraná and Brazil's economy. Considering the limitations of the research, it was noted that the link between the different activities of agricultural cooperatives, begins in the acquisition of raw materials to after-sales of products developed by them. Thus, the different strategies on cost management of these companies, if considered in strategic cost analysis can result in competitive market advantage.

An experimental research on governance mechanisms for cost of value chain

PurposeThe purpose of this paper is to discuss the governance mechanism of overcoming or solving three problems: cooperation problem, coordination problem and appropriation problem. Also to raise the value chain cost efficiency and to elevate the value chain competitive advantage.Design/methodology/approachThe methodology is the experimental study. The authors design an experience simulating the transaction process across firms to explore the separate and joint governance effects of trust and incentive on the cost of value chain.FindingsAccording to the experimental results it is found that the high level of trust between firms and the incentive based on the joint interests of value chain can effectively mitigate or avoid the cooperation, coordination and appropriation problems, and thus have significant governance effects on the cost of value chain. Incentive is out of effect when a much lower level of trust across firms exists, which reflects that there is a significant complementary relationship between trust and incentive mechanisms.Research limitations/implicationsThe research limitation is that the practical experience and the cognition of experimenters of the researchers will influence the conclusion of the experiment, so the research on the influences of other factors must be deepened.Originality/valueThe paper's value is in setting out a value chain cost management theory frame, demonstrating trust and incentive as two kinds of governance mechanism in the value chain cost management mechanism, adopting experiment method to verify the above theory, and providing the relevant behavior evidence for future research.

Value Chain Cost Tracing And Cost System Obsolescence: An Exploratory Study Of Small To Medium-Sized Companies

<span>To succeed in todays competitive business environment, corporations need to undertake value chain analysis and select an optimal mix of value chain activities. Based on the data collected from 73 small- to medium-sized companies, this study provides evidence regarding current practices in value chain cost tracing and cost system obsolescence. The research findings indicate that companies do a better job of linking value chain costs to products/product lines than to customers/customer classes. Overall, however, the proportion of each value chain cost attributed to either cost object tends to be low. This indicates that firms management may be rather slow in adopting new management tools. Furthermore, most companies are still using value-based cost allocations, which suggests cost system obsolescence. Implications of this study and future research directions are also discussed.</span>

Linking Value Chain Costs To Products And Customers: Survey And Evaluation Of Large U.S. Manufacturing Firms’ Current Practices

Success in a competitive environment requires effectively selecting an optimal mix of value chain activities. Despite the fact that corporate executives need to understand the costs and benefits of supporting particular products and customers, little empirical evidence is available on how, and how well, companies are linking their value chain costs to these two cost objects. The results of this study, based on responses to a survey of 120 large U.S. manufacturing companies, indicate that firms tend to link their value chain costs to products/product lines more than to customers/customer classes. For both cost objects, most of the cost allocation bases used is volume-based. These findings suggest that while there is attention to the value chain costs, there is room for increasing the proportion of costs traced to products and customers and for expanding the use of non-volume allocation bases.

As transações entre supermercados europeus e produtores brasileiros de frutas frescas

Vários autores apontam a importância do segmento varejista como indutor de mudanças nas cadeias produtivas de diferentes produtos. Particularmente, no que diz respeito às cadeias produtivas de frutas frescas pode-se observar a importância do segmento varejista como indutor de padrões de qualidade e de uma série de mudanças que se revelam por meio de ações tomadas pelos outros segmentos de maneira a atender suas exigências. No entanto, não há estudos que mostrem qual a intensidade desta ação e quais os elementos que podem influenciá-la. Sendo assim, o objetivo deste trabalho é caracterizar as transações entre produtores brasileiros de manga e uva e compradores europeus e as estruturas das cadeias de valor de manga e uva para exportação. Na parte conceitual foi utilizada a abordagem de Cadeia de Valor Global e de Economia dos Custos de Transação. O método escolhido foi o estudo de casos múltiplos, conduzido com duas cadeias produtivas, a de uva e a de manga, voltadas para exportação para o mercado europeu. Foram conduzidas entrevistas presenciais com produtores e exportadores brasileiros de manga e uva, bem como com importadores alemães, ingleses e holandeses, no período de 2004 a 2005. Os resultados indicam que os supermercados atuam de maneira diferenciada nos dois mercados estudados, o inglês e alemão. Nas transações entre supermercados ingleses na cadeia de valor de frutas frescas com produtores brasileiros há o gerenciador de categoria que é o agente responsável pela ligação entre produtores brasileiros e supermercados ingleses e predominam estruturas de governança híbridas. Já no mercado alemão, não há o gerenciador de categoria e predomina a estrutura de governança de mercado. Estas diferenças nas estruturas das cadeias de valor nos dois mercados têm implicações diretas na maneira de inserção dos produtores de frutas frescas de países em desenvolvimento no comércio global.

The effects of country and industry on implementing value chain cost analysis

This study provides evidence based on data collected from 65 US and 34 Hong Kong companies regarding current implementation of value chain cost analysis. The findings indicate significant differences in cost systems of companies in these two regions under value chain framework. The US manufacturing firms have invested more of their resources in upstream activities than have their Hong Kong counterparts, but this observation did not hold in the service industry. Overall, however, the results support a positive link between the percentages of cost and degrees of cost tracing, particularly for upstream activities, for firms in both regions. Implications of this study in cost management for the US and Hong Kong companies are also discussed.

International direct marketing: Export value chain, transaction cost, and the triad

Within the context of recent technological, economic, political, and social developments, this article covers the following: market entry strategies and international direct marketing, export value chain and transaction cost analysis for judging the effectiveness of international direct marketing, the drivers encouraging the growth of international direct marketing, and the Triad and international direct marketing.