Understanding downstream operations
Downstream operations are activities that occur after the firm in the overall industry value chain. The companies that a firm supplies for example are downstream. There may be multiple subsequent downstream operations before the products reach the final customers.
Examples of downstream operations
Some examples of downstream operations are:
- The sale of gas/petrol is downstream of the refining stage in the oil and gas industry
- The processing of metals is downstream of metal smelting
- The smiling of metals is downstream of metal mining
- The processing of food products is downstream of growing crops