Based on the Case Stude Below

Question $2$ on Primary and Support Activities in Value Chain Analysis

You are consulting for MDFB$,$ a small business in the Muslim fashion industry in Indonesia. The company has several issues in its value chain, particularly in operations and procurement. Your task is to assess and improve their value chain.

Task:

a$.$ Explain the difference in a very detailed manner between primary and support activities in value chain analysis, using MDFB as a case study.

b$.$ Identify the key problems in MDFB$\text{'}$s operations and procurement activities based on the document.

c$.$ Propose a set of solutions that could address these issues and improve the efficiency and profitability of the company$$ by giving examples of successful start up company in the fashion industry similar to the case study

Case Study of a small Company

We examine the application of value chain analysis to MDFB$,$ a small Muslim fashion firm in Bandung, Indonesia. The study identifies key issues in the company's value chain, particularly in operations and procurement. It delves into how value chain analysis can enhance the understanding of activities that add value to products, particularly in the small Muslim fashion industry. In an article, the authors explore various challenges faced by small businesses and provide a unique blend of strategic and operational perspectives. The analysis can help identify and eliminate non$-$value$-$adding activities, ultimately leading to improved business performance!

Key issues include:

Operations:

Inefficient production processes due to disorganized raw materialsLack of planning in material purchases

Procurement:

Dependence on a single vendorImmediate payment practices affecting cash flow

The analysis distinguishes between primary activities $($directly involved in product creation and delivery$)$ and support activities $($facilitating primary activities$).$ For MDFB$,$ primary activities include inbound logistics$,$ operations, outbound logistics$,$ marketing and sales, and service. Support activities encompass firm infrastructure, human resource management, technology development, and procurement.To address these issues and improve efficiency and profitability, the following solutions are proposed:

Implement a systematic inventory management system. Diversify the supplier base

Develop a strategic procurement plan

Enhance operational efficiency through better organization

Invest in employee training and development

Improve financial management practices

By implementing these solutions, MDFB can potentially improve its operational efficiency, reduce costs, and enhance profitability in the competitive fashion industry.