Omega Protein

1.1 Value Added and Non-Value Added Activities
Before beginning a discussion of the Omega Protein Value Chain, first we must define a value added activity.   A value added activity must meet three requirements;
  1. The customer must be willing to pay for it.
  2. It must be done right the first time
  3. It must somehow change the product or service in some manner
All activities which do not meet each of these three requirement s are considered non-value added.   These activities typically account for 95% of lead time and thus are often eliminated, reduced or simplified. (www.isixsigma.com)
The Omega Protein Value Chain
Omega Protein Corp is North America’s leading producer of fish meal and fish oils servicing over 600 domestic and foreign customers.   Omega’s products are derived from menhaden, an inedible fish found along the East Atlantic and Gulf of Mexico.   Omega Protein’s operations are vertically integrated, with management overseeing each control point of the supply chain.   This includes everything from the physical harvesting of the menhaden to the sale and distribution of its products to end users.   (Omega Protein Corp. 10-k 2009, Company Overview)

Omega Protein’s Value Chain can be separated into four primary value chain activities; Fishing, Processing, Distribution, Marketing and Sales.
Fishing
The first segment of the value chain is the physical harvesting of menhaden.   Omega owns its own shipyard, spotter aircraft, purse boats, and refrigerated carrying vessels for this purpose.   Menhaden commonly inhabit warm shallow waters and school in large, tight clusters.   Spotter craft fly overhead and upon locating a school of fish, direct the purse boats.   The purse boats encircle the schools with purse seine nets as illustrated in the graphic to the right.
Spotter planes direct purse boats to harvest school of menhaden
The two purse boats then complete the circle and draw the net towards the carrying vessels, entrapping the school.   The fish... [continues]

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