In the business world, the value added concept explains a basic feature of a business.This concept explains that a primary product can be sold for a higher price after some advancements are made to it. For example, if you buy a book for Rs.500 and spend Rs.200 to get it wrapped in a customised wrapping, you would sell it for Rs.750,in order to gain profit. In this case Rs.200 is the added value.
This concept is usually used by sole traders, as they have less room to expand their business, yet it also helps them gain profit.
