Value is added as the product is developed (the left side uphill slope) and once the product reaches the top of the hill, the product’s value is at its maximum after a relatively short time the product’s value is destroyed quickly and value rapidly goes downhill (Achterberg et al., 2016).
Value Creation is the process of turning labour and resources into something that meets the needs of others.
By extracting resources from the earth, refining them for manufacturing, assembling them into products and distributing them to consumers, value is added at every step.
“Value-added" describes the economic enhancement a company gives its products or services before offering them to their customers.
Drawing materials from the environment for human use, such as fossil fuels (oil, gas, and coal), rocks and minerals, biomass (deforestation, fishing and hunting) and water.
The value of such extracted materials will be higher due to the now accessible and usable materials, for example:
Manufacturing refers to processes or steps within a process which transform raw materials into more valuable materials or components
Assembly refers to processes which transform components into products
Retailers create value by delivering products and engaging experiences that fulfil end-consumer needs.
The peak value will be at purchase by the consumer
After the consumer no longer uses the product, its value decreases.
Value decreases for the product, components, and materials.
Value destruction occurs when the products, components, and materials are disposed of as: