Contribution of Services in Value Chains and Product Cost: With a Focus on Ready-Made Garments, Engineering and Food Industries, and Agri Crops



Many services enter the value chain in a variety of ways. Services are invisible and in many instances customized or bundled with other products (goods or other services) and, therefore, often difficult to cost and easy to overlook in terms of their contribution to competitiveness. At the same time, services are often highly regulated. Policies can impact costs and supply chain configurations in ways that are sometimes not fully appreciated by policy makers and regulators, as well as businesses. They can add avoidable costs if policies are poorly designed or administered.

The purpose of this exercise, as laid out in this note, is to better understand the complex, multifaceted and often overlooked role of services in production, distinction and consumption in order to identify additional sources of efficiency and competitiveness, and consequently, arrive at proposed policy and regulatory reforms.

In context of the above, three roundtables were held that respectively addressed the ready-made garments industry, engineering industries, and food industries and agricultural crops. Each roundtable analyzed the results of a survey conducted by ECES to determine the services related to the product’s value chain and the cost thereof. The aim is to reduce the cost of the product through improved economic efficiency of these services and to identify policies and measures that need improvement to achieve this objective.