This report provides a comprehensive analysis of the value chain concept, its advantages, and its application within an organization. The A2 Milk Company serves as a case study, with the report examining how value chain analysis can be used to achieve economies of scale. The report delves into the company's competitive strategy, value chain model, and value-adding processes. Additionally, it explores cost allocation using the Activity-Based Costing (ABC) approach, including detailed calculations of allocation rates, overhead costs, and overall job costs. The report also discusses the relevance of these concepts in achieving competitive advantage and making informed business decisions. The report addresses the A2 milk company’s competitive advantage by producing unique high-quality products. The report uses the value chain model to attain a competitive advantage through enhancing the speed at which it delivers its products to its final consumers.