Explain value chain of farming business

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Reference no: EM135608

The major impact of third industrial revolution in agricultural equipment manufacturing value chain in the upcoming years will be heavy investment in R and D section of the production. It may shift focus from cost management to innovation and product differentiation. Technology already modified how humans operate machines, save on energy, recycle waste products, track electronic devises and perform tasks in unusual ways. John Deer, one of the largest agricultural equipment manufacturer, for example, have shifted focus to providing integrated solutions in the areas of machine optimization, logistics by connecting equipment, operators, owners and dealers through user friendly monitors, wireless and sensors networks.

The cost of innovation has a straight impact on marketing, service and sales section in the value chain. Without sales and growing market share, the cost for R & D will not be justified; thus it will be crucial for manufactures to understand their market, educate potential customers and offer good quality support and service. Logistics is another area which gives efficiency and is very important to the customer. Adjusting shipping process in order to make sure product is delivered in the appropriate manner without damages can be improved with implantation of the new technology. After all, farmers are the most essential customers for equipment manufacturers and the value chain of farming business is just as significant as a value chain of manufacturer.

Reference no: EM135608

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