The poultry sector has undergone major structural changes during the past two decades due to the introduction of modern intensive production methods, genetic improvements, improved preventive disease control and biosecurity measures, increasing income and human population, and urbanization. These changes offer tremendous opportunities for poultry producers, particularly smallholders, to improve their farm income. Evidence from case studies shows that it is difficult to see a bright future for smallholder poultry production in a rapidly changing industry structure; however, smallholders can still compete with larger producers because of savings that smaller units can achieve because of foregone or cheaper overheads, lower labour costs per unit and, possibly, more intensive supervision, leading to relatively high profit efficiencies. Smallholders also have problems in meeting high demands for food safety, traceability and compliance, because of high coordination costs and high transaction and marketing costs. Increasingly it appears that smallholders’ ability to maintain their competitiveness in these types of markets is dictated by their ability to establish market trust and reputation along the marketing and distribution channels. This will require smallholders to be linked to the supply chain and to obtain certain supply chain management necessities, combining both productivity-enhancing technologies at the farm level and improved coordination in the marketing system.