Value Chain Analysis of Damask Rose in Khorasan Razavi Province

In addition to serving medical and cultural functions, medicinal plants have economic importance as well. Global and national markets for medicinal plants are growing and significant economic gains are achieved through the sale of herbal medicinal products. Examining the value chain of medicinal plants will help to improve and connect the production and supply network of these products. In this study Damask Rose has been selected in Khorasan Razavi province with the aim of analyzing the value chain of this medicinal plant.  Its issues can be investigated in each part of the production network to the supply of this plant and obstacles can be removed or new loops could be created in value chain.

Planning from production to delivery of goods to the final consumer in the form value chain can help to meet the needs of consumers. Value chain is generally defined as a physical network and decision-making activities that are related to the flow of goods and information between organizations and individuals. There are several methods that can provide analysis of value chain performance. Some of the best known methods are: Score model, balanced scorecard, Data-coverage analysis, Life cycle analysis, Activity-based costing, SWOT analysis method. The SWOT model is used in this research. Statistics and information required for this research were obtained through face-to-face interviews and questionnaires. In each of the loops, a number of samples were selected. For example leading producers were selected in the loop of producers that have more than 80% of the province's production and are interviewed in 5 counties.

Damask Rose production is cost-effective in terms of water consumption in Iran and Khorasan Razavi province because it requires little water and usually requires irrigation between 12 and 18 days. Between 1 and 3 tons of Damask Rose can be harvested from each hectare. The major five counties in the production of Damask Rose which have allocated about 80% of the production of Khorasan Razavi province, including the Mashhad (55.3%), Torbat Heydariyeh (13.1%), Zaveh (4.7%), Kalat (3.6%) and Khaf (3.5%). Three channels are drawn for the Damask Rose value chain. Channel one consists of 6 loops: supplier, manufacturer, small-scale processor, intermediary, retailer, consumer. Channel two includes 6 loops: supplier, manufacturer, intermediary, small-scale processor, retailer, consumer, and channel three includes 5 loops: supplier, manufacturer, large-scale processor, exporter (or retailer), Consumer (internal and external). In the desired chain a suitable model for Damask Rose is presented. The difference of this model is transportation and packaging and other removable inputs which are supported by the processor with the help of "contract farming" and are provided to the producer or the farmer. In fact, the processor acts as a local backer for the Damask Rose value chain and this action will cause the necessary standards required by the processor to produce the desired product which will be raised with the inputs that he was responsible for providing them. There is an emphasis on the specialization of market of Damask Rose processors in the favorable value chain. In other words, there is a need to create new processors (or diversification of the type of processing) to differentiate the market of large-scale processors. These separate processors are for to achieve export target market. Strategies were selected based on SWOT analysis.

we would move towards better production if the parts of the value chain that generate the most added value are produced by greater and bigger companies. the important point of this discussion is the findings of this study and the proposed model based on value chain would help to identify the distribution of value added at different stages of the chain, as well increase the focus on profitable parts of the value chain, and also concentrate resources and efficient manpower in more value-added areas.  Missing links in the Damask Rose value chain include:  1) Creating cosmetics, 2) Production of essential oils with special brand, 3) Establishment of processing enterprises in four counties of Zaveh, Kalat, Khaf and Gonabad, 4) Establishing a flower-drying workshop, and 5) Using conventional agriculture. By placing these loops in the right place, the creative added value can be increased. Six strategies to cover the above missing loops include :1) Development of Damask Rose processing, 2) Commercialization of Damask Rose production, 3) Diversification of processed products, 4) Attraction of new export markets, 5) Development of research related to production , and 6) Execution "Contract farming".