Supply Chain and Economic Viability of Vanilla planifolia Andrew Production: A Case Study


Humberto Banda Ortiz
Rodolfo Garza Morales
Katia Vázquez Trujillo



Objectives: To characterize the supply chain of vanilla (Vanilla planifolia Andrew) in
order to detect areas which could be improved and to determine the economic viability
of its production.
Design/Methodology/Approach: The information was compiled through semi-
structured interviews in a vanilla company. The Value Stream Mapping technique was
used to describe the supply chain. Additional databases were consulted in order to
obtain information on the production and commercialization of vanilla. The economic
viability of vanilla production was analyzed with IRR.
Results: This case study had five phases in its supply chain. The IRR of cash flow in
the traditional and technological production systems were positive, although the IRR of
the traditional system was greater even though it had lower production volumes.
Study Limitations/Implications: It was observed that vanilla requires between 3 and 4
years for its first harvest, independently of the production system, traditional or
technological, which means that there are negative cash flow numbers during the first
two years in both systems, despite a positive IRR.
Findings/Conclusions: The critical stage in the supply chain of the company studied
was the production. The cash flow for the technological system was superior when
compared to the traditional system. However, the IRR for the technological system was
lower, since the investment in shade cloth was not compensated by the discounted
cash flows that could otherwise be obtained.

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