The value chain concept, which was developed and popularized in 1985 by Michael Porter, increased the value of production and service and led to a decrease in costs in the business and industry sector. At this present time, global business competition is rising leading to more interest in value chains in businesses and industries because this concept is the apparatus of management in order to analyze positive strategic planning. The most important concept can apply to the supply chain and the distribution network.
This report will explain the background of the Charoen Pokphand Foods Public Company Limited case in detail. I have been focusing on the value chain of the Charoen Pokphand Foods in Thailand. Finally, the report will conclude with an analysis of the value chain in the Charoen Pokphand Foods Public Company Limited
Background of the Charoen Pokphand Foods Public Company Limited: The CPF (Charoen Pokphand Foods) registered as a limited company on 17 January 1978 in the name of the Charoen Pokphand Animal Feed Co, Ltd, which had an authorized capital of 5 million baht. This firm was involved in animal feed businesses and animal husbandries in Thailand, and continued to expand into the shrimp business. Moreover, in 1998 the CP group changed its business structure, and the CPF acquired agribusinesses and agro-industries including animal husbandries and meat processing. The business restructuring of the CPF (Charoen Pokphand Foods) was completed in 1999. Therefore, this firm was Thailand’s leading companies in agribusinesses and agro-industries, as well as this the firm changed its name to Charoen Pokphand Foods Public Company Limited (CPF), which had its vision of the Kitchen of the World, and operated in agribusinesses and agro-industries to sell in Thailand and to export.
However, the company expanded the agribusinesses and agro-industries to overseas and invested in food businesses in the domestic including the expanding export of meat and food products. When the Avian influenza or bird flu occurred in Thailand, in 2004 this firm established its brand, which was called CP. This brand was used in meat processing products, and in addition initiated the instant food products and used food retail businesses under the CP brand in order to sell in the domestic market and overseas.
Moreover, CPF vision developed the Kitchen of the World. As a result, the firm had a target to expand instant food businesses into the domestic and oversea. In the same way, CPF was a leader company in the animal food and meat processing industry. This firm intended to bring the expertise of the complete agribusiness in order to support and develop the standard of animal husbandry in those countries, which led to profits from its efficient business operation. In addition, many CPF businesses were considered under its environmental policy. The firm has developed R&D (research and develop) and HRD (Human Resources Development), and as a consequence is a strong business which can flourish steadily and compete in foreign markets. In addition, CPF was allowed to register its common stock in Thailand’s stock market under its symbol CPF in December 1987. This firm was transformed into a public limited company in January 1994. The new CPF is divided into 2 business lines.
1. Livestock Business Line: chickens, eggs, pigs and ducks.
2. Aquatic Business Line: shrimp and fish.
These businesses produce the full range of products in the areas below: 1. Feed: livestock feed and livestock feed trade
2. Farm: including animal breeding, livestock trade and meat processing.
3. Food: including food processing and cooked products under the CP brand.
The company is divided into 2 main sections.
1. Thailand Operations, which is operated in Thailand to sell in the country and export.
2. Overseas Operations, which is invested in 9 countries, such as Turkey, Malaysia,...