Value Creation with Natural Products in the Food Value Chain

Abstract

The aim of this paper was to study the value creation of natural products in the food value chain and value dimensions of natural products. The empirical part of the study used qualitative research methods. The data for the empirical study has been collected through thematic interviews with actors in the natural food sector. The analysis of the data resulted in the identification of a value chain structure for natural products. The value chains in the sector were found to be relatively short and simple. The processes identified as constituting the value chain were raw material sourcing and processing, packaging, sales, and marketing. Value-adding attributes of natural products were also identified. Utilitarian, social, epistemic, and hedonic values were identified. Of these, the most significant dimension of value can be identified as utilitarian value and factors related to product quality. Social value was found to be generated through labeling that communicates quality, environmental friendliness, and domesticity, which allows communicating one’s values to others. New raw material combinations and research on natural products were identified as sources of epistemic value. Hedonic value was identified as being based on the backstories that are created for the products.